Staff benefit packages
Offering benefits to your staff often helps to maximise the value-for-money opportunities in your staffing costs.
Consideration should be given to a cost benefit analysis of the various options for your particular set of employees.
In many cases your employees will perceive the value of the benefit to be much higher than the actual cost of providing it, which makes such benefits a very useful tool in remuneration negotiations with either individual staff or groups/unions and in general staff retention.
The benefits not only accrue to your staff, but also assist in the efficient management of the company by providing cover for certain risks. For example:-
- Income protection
When you have to let a valued staff member go because of ill health it can be a very difficult decision, almost as stressful for a manager who feels that he is condemning a friend to State Benefits, as it is for the ill employee. If, however, the staff member has got income protection as part of their package, everyone knows that their salary will be largely replaced by income from the insurer. This makes for much better management.
- Critical illness insurance
If one of your staff gets a serious listed illness (but not necessarily immediately fatal, listed illness e.g. some forms of cancer, some forms of heart attack, stroke), then they get a lump sum payment (typically equal to two years salary). Again it helps to resolve the issues inherent in either paying unproductive staff or letting people down when you would really like to help them.
- Medical insurance
The NHS is not as good as we would like at dealing with non-urgent, though painful and disabling, conditions. The fact that your employees' productivity is impaired during the waiting period is of no concern to the NHS managers. If your employees have private medical cover they can get these problems dealt with much faster and thus return to full productivity without delay. This is of course to the benefit of the firm.
With the introduction of auto-enrolment, every employer with at least one member of staff has to enrol all eligible workers in a qualifying pension scheme and pay minimum contributions. Some employers choose to contribute more than the legal minimum.
- Life insurances
Setting up a group life insurance (usually as part of a pension) can be a good idea, and if you have valuable staff with health problems, possibly a way to give them insurance that they could not otherwise buy.
This section of our site contains guides and calculators to help you think about your financial planning needs.
They are aimed at both business owners, who may also be employers, and private individuals with wealth management goals.
Why are you looking for financial advice? Choose from the menu links below.