The employee benefits you offer matter!
In the current market, candidates are in very short supply and there are well documented skills shortages. As a result there is considerable pressure on employers to both retain staff and attract new talent.
The key points:
- Regularly consult employees to assess how positively your people perceive their benefits.
- Think about how age and demographic alters the priorities of those within your firm and ensure your benefits can accommodate this
- Think about how you can incorporate the most flexible working measures.
- Provide a personalised and carefully crafted statement to all staff regularly so they know what benefits they are entitled to and the full value of these benefits.
- Ensure you know what your competitors are offering
- Remember that a good benefits package is a secondary consideration after a good base salary.
There is currently a shortage of talent for management consulting job vacancies.
Indeed, specialist skills are in high demand so firms must ensure that they are offering the best remuneration package they can afford to attract the best candidates. Most firms keep salaries under constant review, but should you be evaluating or redesigning employee benefits to boost employee retention or attract great talent?
With the challenges brought about by Covid, the way in which we work and our workplace priorities are changing. So, do you really know what it is that your employees value? How can you ensure your perks stay competitive as we shift to a ‘hybrid’ model of work?
Why are management consultancy firms’ employee benefits so important?
Benefits can be selected and designed to fulfil several different purposes:
- To improve workplace morale and ensure staff feel valued by their employer
- Help counter stress and staff absences e.g., with health care cover, wellbeing perks or flexible working to improve work/life balance.
- Boost productivity, perhaps also by flexible working or WFH.
- Reinforce a company’s values and ethos
- Improve staff retention
- Make recruiting top talent easier – attracting the best people to your company
The importance of a good employee benefits package
Surveys reveal the high importance that staff place on a good benefits package. Indeed, pre-pandemic 86% of respondents to a Jobsite survey reported being influenced by benefits in deciding whether to move jobs or take a new role. It is, of course, the case that for most staff the base salary is the most important consideration. However, if that figure is acceptable then the quality of the benefits package comes into its own, especially if a candidate has more than one management consulting job offer.
Prism’s own experience also suggests that smaller firms can underestimate the value of benefits. Their reluctance to have a full package is partly because they are seen as an administrative burden and also because they cost money. However, they most definitely have an influence on employee and candidate decisions as clearly, without these benefits, both the administrative burden and costs are transferred directly to the employee. If a candidate has been accustomed to a comprehensive package of benefits at a large firm, loss of these benefits at a smaller firm amounts to a reduction in remuneration in absolute terms as well as something of a shock. Indeed there is a risk that a smaller firm might seem rather amateur and parochial by comparison.
Also, there is a symbolic aspect: a good benefits package can be perceived as representing bigger firm aspirations in a smaller growing employer.
To what extent has the pandemic influenced the value of staff benefits?
The crisis since March 2020 has put a spotlight on the way we work. It has demonstrated that flexible working is possible and work life balance is increasingly a priority for employees. It is unlikely that most staff will want to return to the 9 to 5 office culture but instead may prefer what is increasingly being considered a more balanced life. There is now a greater focus on health, (both mental and physical) and wellbeing.
The results of a recent study carried out by Moneypenny revealed that for over 40% of respondents, pension was the monetary benefit which they deemed most important. Sick pay was also felt to be important. Perhaps this is a legacy of the pandemic which shows the value of both long-term planning and short-term financial security.
The importance of flexible working
The pandemic acted as a catalyst to transform the traditional working week and now, largely irrespective of changing Government guidelines, most firms are expecting staff to work from home at least part time.
Big Four professional services firm PwC announced in April that its 22,000 UK staff will now work from home between 40% and 60% of the time and be allowed to choose the times they start and finish their working days. The rest of the time, PwC will expect staff to be with their colleagues, either in offices or at client sites.
There is now an acceptance that to ensure people are at their happiest and most productive, flexibility is needed in both where and when they work. For firms such as PwC and other management consultancy employers who are adopting flexible working, this will be essential when it comes to retaining and recruiting staff. In fact, our experience is that almost all our clients now offer flexible working as the norm. Those who do not, have struggled and will continue to struggle to recruit.
Benefits vs ‘perks’
The terms are sometimes used interchangeably but very generally benefits are contractual and provide the employee with an entitlement to something that they would otherwise have to pay for. This will include for example health insurance, life insurance, paid time off and a pension scheme.
‘Perks’ typically include such things as flexible working, the ability to work remotely, paid parental leave and WFH allowances. The best employers will focus on inclusive perks available to everyone, no matter where they are based.
What are the most attractive benefits in 2022?
The response to the Moneypenny survey revealed employees still value conventional benefits which provide them with security:
- Pension – with employer contributions more generous than the statutory minimum
- Sick pay – over and above the legal requirement
- Health cover – including eye and dental cover
- Life insurance
- Paid time off – for illness, bereavement or personal time off
- Generous maternity and paternity leave
Other well received perks worth consideration include:
- Working from home allowance
- Gym and exercise classes: virtual or otherwise
- Wellness allowance and support
- Free language lessons
- Birthday treats and “birthday day off”
In particular, younger staff value holistic benefits around wellbeing and health. An example of such a benefit is mental health support, particularly pertinent after the challenges of Covid. This perhaps reflects a growing openness around the topic of mental health as a whole.
Also have in mind that the areas of life with which staff expect or require support are changing. Employers need to be forward-thinking in their decisions about benefits packages. Some areas that are increasing in popularity are fertility, reproductive health, menopause support, gender dysphoria, carer responsibilities, and neurodiversity support. These need to be considered when reviewing benefits and will have a direct effect on your firm’s diversity and inclusivity.
The benefit of flexibility and personalised packages
The attractiveness of a particular benefit varies depending on employees’ circumstances. Because your workforce is made up of individuals at different stages of their lives and careers, with a range of different wants and needs. Your benefits offerings should reflect this – from Millennials looking for high street discounts and career development schemes, young professionals seeking flexible childcare options and advice on mortgage rates to those close to retirement who may be more appreciative of private health care options.
Younger age groups feel most positively towards tailor-made employee benefits packages. A personalised package, where you can pick and choose the perks most important to you, is often very appealing.
Make your employee benefits and rewards clear
Make sure you remind your staff exactly what their benefits packages include. Sometimes the differing perceptions of employees and HR regarding the quality of their packages can be explained by staff not realising exactly what benefits they are receiving and therefore their value.
Indeed, at Prism, we often come across candidates who struggle to recall their allowances and benefits. Ensuring staff know exactly how good their packages are can act as a positive retention tool.
It is therefore important to maintain an open conversation regarding staff perceptions of company benefits. It seems there is not always enough knowledge within HR teams of what employees’ value when it comes to benefits. A good benefits package has an important influence on staff decisions and job moves. Companies should understand what employees value to aid staff retention and attraction.
Find out what benefits your staff value the most
Dipa Mistry Kandola, Head of Flexible Benefits Services at Lane Clark & Peacock LLP, not only emphasises the need for HR to analyse data to identify trends in staff retention and salary etc. but also to ask staff what they actually want. She says, “that’s what a lot of our big and small clients fail to do. You can’t just ask via surveys. You’ve got to ask employees in small focus groups ‘what do you think about our benefits and rewards”.
Jobsite’s survey revealed that 85% of employees surveyed felt that they were able to directly compare their benefits package vs those on offer at competitor firms. For management consultancy firms, this stresses the importance of keeping up to date with what other firms are offering in order to prevent poaching and to stay competitive when attracting talent. Moreover, it indicates the role that employee benefits packages can play in shaping perceptions of the company brand.
A good way to determine what is popular with employees, other than by focus groups and employee forums is to use regular pulse surveys. These are being increasingly utilised, particularly during the pandemic, to understand how employees are feeling. They are a great way to measure the effectiveness of your benefits package and also to gain an understanding of any shifts in your people’s needs and wants.
Align the benefits you offer with your company values
Today’s job seekers pay great attention to company values and culture. Potential employees have high expectations. They will often really consider the culture and values of a business before applying for or accepting a role.
It is therefore important to take care that benefits are in line with your stated values. For example environmental related, or work life balance.
In summary, what are the key points to remember when it comes to evaluating your benefit offerings?
- Regularly consult employees to assess how positively your people perceive their benefits.
- Think about how age and demographic alters the priorities of those within your firm. Consider to what extent Flexi-packages, accommodating the differing priorities of your staff at different ages and stages of their careers, are feasible.
- Think about how you can incorporate flexible working measures. Pre Covid the majority of consultant work was carried out on client site. But the use of technology during the pandemic has proved that consultants can working from home or remotely. There is much evidence that employers not offering flexibility to employees will struggle to recruit.
- Provide a personalised and carefully crafted statement of benefits to all staff regularly. Summarise their employment package and the value of their benefits – a PowerPoint or other document will help aid staff retention. It may be that employees need a periodic reminder of what benefits they are entitled to and the full value of these benefits.
- Ensure you know what your competitors are proposing. Stay ahead of the game rather than lose current and prospective people to better offerings.
- Remember that a good benefits package is for most staff a secondary consideration after a good base salary. Although they may be the icing on the cake, benefits will not pay the bills.
For more information on how to retain and attract the best talent email Chris Sale, Managing Director, Prism Executive Recruitment [email protected] or call him on 01344 636426