More and more companies are adopting flexible benefits. More and more employees are also looking for flexible benefits options from their employers, as shown in the statistics.
So, what are flexible benefits? This can vary depending on what companies are willing to offer their employees.
The most common version of flexible benefits involves a ‘benefit allowance’ or ‘flex pot’. An employee’s benefit allowance holds an amount of money allocated by their employer that can be used towards the cost of their elected employee benefits.
For example, an employee might want to apply for a discount card through their employee benefits platform. When doing so, they could choose to allocate some money towards a portion or all of the cost of the discount card when purchasing it.
Flexible benefits suit everyone in the business
Flexible benefits suit employers and employees. Employees get a more tailored benefits package with more choice over what benefits they want to use. For example, some employees might value more health-based benefits that suit them and their family, other employees may prefer discount cards.
This is great for employers as their benefits package will suit more employees, which should drive scheme take-up and increase employee engagement. For companies with a diverse workforce, flexible benefits are even better. Designing a benefit offering that suits everyone in a company made up of varying demographics is a challenge for many companies.
Boosted recruitment and retention
There are many reasons for having an employee benefits package. One of the key reasons is to boost employee satisfaction and loyalty. A more engaging, tailored benefits package therefore will increase employee satisfaction and loyalty even further.
A good benefits package is also great for recruiting new talent. Again, an even more tailored benefits package will boost recruitment.
The costs associated with recruitment and retention are a lot higher than many think. It’s estimated that the average cost-per-hire is £3,223 and the average annual turnover rate is 19%, according to SHRM. For a company made up of 100 employees, that would cost around £61,000 a year in recruitment. Boosting recruitment and retention could therefore save companies thousands every year.
More control over benefits spend
This depends entirely on how the company uses its flexible benefits. If a company chooses to allocate flexible spending allowance at fixed periods throughout the year, every month for example, it becomes a more predictable, regular cost for the company. They’ll have a better idea of how much they expect to spend on benefits every month.
The company can also monitor their spend more regularly and adjust it going forward.
Happier employees, increased employee engagement and platform use
A company with flexible benefits will reap all the rewards that come with increased employee engagement, happier employees and increased employee benefits platform use. Further advantages include boosted productivity, and as mentioned improved recruitment and retention. There’s also the savings associated with all the benefits mentioned here to consider. The savings made through improved employee retention alone is a major reason why all companies should consider flexible benefits. It can be more difficult to quantify the savings made through boosted productivity and employee satisfaction, but the advantages of both are obvious for any business.
With everything mentioned here, it’s easy to see why everyone is talking about flexible benefits!