The importance of flexible employee benefits in the modern workplace
The effects of remote working, as well as the adoption of digital platforms in the workplace, have turned human resources and payroll departments upside-down. While debatable whether these will have a positive or negative long-term influence, it gave rise to flexible timeframes and flexible working environments.
This was made more complex by the difficult task of ensuring employee productivity and performance with remote working arrangements, as well as overall staff well-being and morale during an on-going pandemic. Consequently, employers began focusing on flexible employee benefits to adjust to the new demands.
What are flexible benefits?
Employees are no longer simply hunting for a job and a basic salary. A company’s employee benefit offerings have become just as important as the employee’s net pay position or cost-to-company total.
These fringe benefits could include company contributions towards health insurance or medical aid schemes, pension funds, life and risk cover options, and even travel allowances. Employees are often able to adjust the amounts on their retirement savings initiatives or select a level of healthcare according to their own specific needs.
For example, an older employee with children and a degree will have an entirely different list of preferences or requirements than a younger employee without children. For this reason, flexible needs require flexible benefits.
Other flexible benefit examples may include in-house professional development (as with internships) or student loan reimbursement (as with higher education institutions). The company might also offer their employees a car benefit scheme, or a host of other benefits through rewards partners, such as exclusive deals with gyms, cafeterias, or wellness institutions.
What are the advantages of flexible employee benefits?
In the same way that customers are more responsive or engaging to a personalised marketing narrative, so employees also find that personalised benefits speak more directly to their needs. The more personalised the benefit structure, the more it could appeal to them at that current moment.
By allowing employees to have some say over the structuring of their benefits and rewards schemes, it already increases their engagement. It has further been established that employees who are satisfied with their remuneration packages and benefits, show more engagement in the workplace.
Improved employee retention
Employee retention can become a silent killer if not closely monitored. It often serves as a clear indicator that employee morale or sentiment is suffering. It’s not unfeasible to assume that the additional rewards that employees reap from their remuneration package, could make them less likely to leave the company. Flexible benefits go a long way towards improving employee satisfaction, and wellness, and ultimately, may impact their retention.
Improved employee recruitment
In contrast to employee retention, there may be the dilemma of being unable to fill a position because the current reward structure is not accommodating enough for new recruits. Employers should bear in mind that potential employees could sacrifice competitive compensation for a preferred work culture or the flexible benefits that form part of their overall remuneration package.
Remuneration or payroll specialists are there to assist HR departments with the structuring or restructuring of a company’s job profiles, salaries and benefit structures. Given the increased demand for flexibility, it is best to consult a firm with a proven track record in remuneration services and experience in employee taxation.
Tanya Tosen is a tax and remuneration specialist; Janine O’Riley is a chartered reward specialist and psychometrist.