You’re satisfied with the employee benefits you have in place and are comfortable with the associated costs. But are you confident your employees fully understand the benefits which are available to them? If you have invested time and money into developing your benefits package, it is vital that you have an effective communication strategy in place to make sure your staff are taking full advantage of what is on offer. Below are some examples of aspects you may wish to consider when developing your communications strategy:

Communication

As the saying goes, ‘communication is key’ and often we find that staff are told about employee benefits when they join a company, as part of their induction, but this doesn’t get mentioned again. Regular communications thereafter will ensure everyone remains informed and engaged. This could include specific communications during different lifestyle events e.g. marriage/the birth of a child.

Appoint Employee Benefits ‘Champions’

One way to fully involve employees in the communication plan is to appoint employee benefit champions. Seeing fellow employees being proactive and positive about the benefits schemes will encourage the workforce as a whole to get involved and participate. This is a great way to spread knowledge and enthusiasm.

Put it in writing

All information about the benefits you offer should be in writing. This should be in a format which is easy to read and digest. Every employee should be given a copy of your benefits handbook, and an overview on how to locate commonly sought information.

Use of Online Platforms

If your company uses an intranet site, this can be a great platform to communicate information about your benefits. You could also look to maximise your use of free social media platforms such as Twitter or LinkedIn. An internal group could be created to keep employees up to date on the benefits they have access to.

Staff feedback

Employee opinion surveys are a great way to measure the level of understanding that employees have about the benefits you provide and how engaged they are. These surveys can also provide you with an indication of what benefits your staff value the most. Effective communications don’t need to be costly. You can maximise the use of systems you already have to provide information in a quick and easy way. Wingate can help you to develop your employee benefits strategy, to ensure your staff are making the most of the valuable benefits you provide for them. If you would like to discuss further, please don’t hesitate to get in touch.

The Benefits of Communicating with Employees

Founded in 1998, Group Risk Development (GRiD) aims to promote and enhance the status and uptake of corporate group protection benefits on behalf of its members within the UK insurance, reinsurance and adviser markets.

GRiD has conducted regular employer research since 2009 and the purpose of the 2019 survey is to drill down and ask employers what they are thinking and doing in relation to looking after their staff, especially since this is what Government is now expecting from them. In this survey, GRiD surveyed 500 HR decision makers in 500 UK businesses, including 100 in companies with more than 250 employees.

Benefits of Communication in the Workplace

Rewarding and motivating staff through ways such as celebrations and training are very visible, can give immediate gratification, and will be appreciated by certain sections of the workforce.

However, many employers realise that longer-term benefits, can have an even wider appeal and longer lasting effect. It’s particularly important to show how different benefits can address specific needs that staff may have according to their age, life-stage and lifestyle.

Employers monetary spend across all benefits including things such as Pension, Medical Insurance and Group Risk Insurances to name a few, is not usually insignificant and therefore employers need to ensure that staff understand and more importantly appreciate what they have.

For example, group risk benefits often provide access to an employee assistance programme as standard that can provide advice that the whole workforce can benefit from, such as on moving to a new house, probate, flooding, parking tickets and disputes with neighbours. This kind of support can be greatly valued by staff and it helps to improve productivity by alleviating distractions.

However, how does an employer get this message out to staff?

Communication Survey Results

HR decision makers told GRiD’s survey that they use a variety of means to communicate their employee benefits package. Based on the results of GRiD’s recent survey, the communication methods most used are:

• Staff welcome pack – 31%
• Email – 28%
• Staff handbook – 25%
• Employment offer letter – 22%
• Total Reward Statements – 11%
• Benefit platforms/apps – 10%

Worryingly, ONLY 25% of employers issue regular communications (at least quarterly) about their benefits.

Communication is key to getting good value out of any benefit spend but what is the best way to communicate to a workforce? Unfortunately, there is no magic spell that will work for all employers therefore using a mix of methods is most effective and more importantly, communication must be on a regular basis. This is especially true of group risk benefits when they are not needed until something changes for an employee and then they are needed.

It is also vital that employees, HR and line managers are aware of all the embedded help that comes with a group risk product and how to use it to best effect.

Wingate Benefit Solutions work with employers of all different shapes and sizes to help with the design and implementation of the most optimum communication strategy. This could include such methods as face to face staff presentations, easy to read benefit guides, total reward statements and the ever-growing popularity of online benefit platforms. Should the topic of communications be something that you wish discuss, please feel free to contact Wingate.

Keep It Simple Stupid

Let’s be honest, pensions are not the most exciting subject in the world but we probably all acknowledge that they are very important. I have been to many a party, night out etc and have been chatting to people about everything and nothing when the old, ‘What do you do for a living?’ question comes up. In my mind, I want to say ‘dolphin trainer’ or ‘lion tamer’, but the words ‘I’m a Pension Adviser’ just comes blurting out and funnily enough I am left standing on my own…

The lack of excitement around pensions is not helped by the way that pension providers give information to consumers. Often we receive our annual pension statement through the post in the form of a big pack and if we are lucky, we’ll read the first page, maybe the second and simply file it in our dusty old pension file where the last 10 years annual statements are all stored. We all have the best intentions of reviewing our pension/s one day but that day tends to happen when it’s a little too late and retirement is looming leaving us with little time to take any remedial action on the value of our pension.

A recent government Automatic Enrolment review has found that less than 14% of people read and understand their annual statements and this represents a “missed opportunity” for the industry to engage and educate savers. As a result, the Pensions Minister has suggested a new simplified two-page annual pension’s statement in a bid to provide a best practice template for the industry. The proposed simpler annual statement consists of just two sides of A4 paper and includes the information that matters most to people saving for retirement. It clearly signposts to other detailed information that can sit separately on an insurance company website. This reflects legal requirements and can be amended by providers using their own branding. The simpler annual pension statement is available to view at the following link https://www.plsa.co.uk/Policy-and-Research/Document-library/Simpler-annual-pension-statement

Whilst this is a good step forward, there is still a long was to go to raise the profile of pensions. It seems as though the balance of responsibility is moving away from the government and some of this responsibility sits with the employer to help with pension education.

Even if staff are not actively engaged with pensions, spending 30 minutes a year to understanding whether your investment is right for you, understanding what you are on track to receive from your pension and the state pension and how to make up any shortfall, is not an overly onerous commitment but it’s hugely important and beneficial.

Wingate Benefit Solutions has designed a pension employee engagement service for employers to try and de-jargonise pensions for employees (just like the proposed new statements) with a view to getting staff engaged with pensions and planning their futures. If you a looking to understand how pension education can help increase employee appreciation of the provided pension arrangement leading to greater staff retention and engagement, please do not hesitate to contact us.

As part of new UK regulation, thousands of employers (employing over 250 employees) as of 4th April 2018 are now required to publish their gender pay gap figures for the first time and the information published so far, has shown that there is still a gender pay gap for women in companies.

This gender pay gap will impact on a woman’s ability to save for her retirement.  It’s simple maths!!  You earn less, but have the same expenses, so you have to prioritise your spending .  It can be very difficult to think of the future when you have to pay  for the here and now.

A recent survey by Scottish Widows* stated that the average pension saving pot for women was £64K compared to a mans of £125K.  This is partly due to taking career breaks to have families, adjusting working hours to care for families and the cost of childcare which when combined,  can affect women’s  ability to save for the future.  As life’s’ priorities change many women’s priorities change and pension savings take a backseat.

In addition to the imbalance, many women who work part time may not earn enough to qualify for pension automatic enrolment, meaning  that they may not be saving at all for a pension.

Relying on your husband’s pension?

Some women are relying on their spouses  pension in retirement.  Statistics show that 42% of marriages end in divorce in the UK and 71% of divorced couples did not discuss pension as part of their settlement . 40% of women have worse retirement prospects after divorce.  A general lack of pension knowledge could be one reason why women’s retirement savings worsen after divorcee.  It is important that all women understand the steps that need to be taken to secure their own independent future.

What about the State Pension?

Combine this with the fact that a BBC report* uncovered that men still receive an average of £28 more a week in state pension despite reforms starting to narrow the pension gap.

Solutions?

Many employees, not just women, do not appreciate the importance of saving for their future retirement.  Women typical are already disadvantaged in the work place, as shown in the Gender Pay Gap reports but this coupled with the lack of retirement planning education are a recipe for retirement disaster.

We have found that pension and general retirement education, in particular for women, is highly valued and appreciated. It helps them fully understand the importance of their pension and saving for their retirement in general. If they are aware of the gaps early enough and the cost of filling these they can look to do something about it rather than finding out too late.

Employers working with the right advisers can provide employee support via face-to-face meetings, group presentations, telephone helplines or online education. It can be very flexible, tailored to meet each employers environment and culture and doesn’t have to cost lots or take employees away from their work for long periods of time.

You’re paying into pensions for your employees but if they don’t understand the benefits of this to them personally, in realistic terms based on their own circumstances, do they appreciate and more importantly value this? In our experience some may a little, but nowhere near as much as when they do.

 

Helen is a Strategic Benefit Consultant specialising in strategies to maximise employee benefit value. Her contact details are: helen.pengelly@wingatebs.com 07825 990356 alternatively contact the Employee Benefit Team on 01883 332260.

 

Sources:

Scottish Widows Women and Retirement Report 2017  http://www.scottishwidows.co.uk/extranet/working/about/reports/womens-pension-report

BBC  ‘State pension gender gap ‘narrowing too slowly’’   http://www.bbc.co.uk/news/business-43835706

 

Lifetime ISA’s or LISA’s as they’re known were announced in March 2016’s budget as a new form of ISA designed to encourage longer term savings for the younger population for two key purposes, purchasing a new home and/or retirement. These alongside the auto enrolment requirements are likely to leave younger employees with ever more questions as to the best long term savings route for them.

LISA Q&A

LISA’s are due to be launched on 6th April 2017 and to help we’ve provided below a simple Q&A covering the most common questions we get asked on this subject. Please note these are provisional answers to the questions as we understand them today BUT could change prior to the 6th April 2017 launch so please treat this as general ‘yet to be finalised’ information.

  • Who can have one? You must be aged over 18 and under 40 (on the 6th April 2017)
  • How much can be paid into a LISA? £4,000 per tax year either regularly or as lump sums. The £4,000 counts towards an individuals total £20,000 ISA tax year allowance (from 6.4.17)
  • What is the Government’s bonus? 25% of the contributions paid in e.g. if you save £4,000 in a tax year the bonus paid at the end of the same tax year would be £1,000
  • How long is the bonus paid for? Until you reach age 50. Therefore the maximum bonus anyone could receive is £1,000 x 32 (age 18 – 50) i.e. £32,000
  • Are there any withdrawal penalties? If money is withdrawn prior to age 60 for any other reason other than to pay towards your first property then you will pay a 25% penalty on the money withdrawn. This withdrawal penalty does not apply in the first year i.e. prior to receiving the first bonus. There has been talk of other instances that an individual may be able to make penalty free withdrawals prior to age 60 but these are unlikely to be in place by the 6th April 2017 launch
  • Explain the two specific LISA purposes? 1) For first-time buyers to use towards a residential property (costing less than £450k in London and £250k elsewhere) that you then live in and 2) To use towards your retirement once you reach age 60; you don’t have to have actually retired this means assisting toward later life expenditure
  • Is the money taxed in the LISA and when I take it out? No
  • What can a LISA invest in? Both Cash and Stock & Shares

LISA or Pension?

LISA’s provide another positive long-term savings option for the younger demographic and as such are to be encouraged however we don’t see these as a direct replacement for a pension but inevitably employees will start to consider one against the other once LISA’s become available and more publicised.

LISA have the advantage over pensions of being able to access the money tax free at anytime (although there could be a penalty for doing so) plus they can be used towards the cost of purchasing a first home. The money can be withdrawn tax and penalty free from age 60.

However a pension with a fully or part matched contribution from an employer (such as with Auto Enrolment) and/or 40% higher rate tax relief on a contribution would usually make the pension financially better than a LISA. In addition you can access money from a pension from age 55, the money is usually Inheritance tax free, it doesn’t affect any (pre retirement benefits entitlement and is protected from creditors in bankruptcy, all of which are not features of a LISA.

As with all financial matters it comes down to the individual’s personal circumstances, priorities and needs as to whether one option is better for them than another or whether a combination of different arrangement would be best.

Employee Financial Education

What the introduction of LISA’s does is further highlight the huge value employee financial education can provide. A facility that helps employees understand their long-term savings options which as a result ultimately leads them to make appropriate long-term financial decisions, could actually be life changing.

 

 

If you would like to discuss LISA’s or the options Wingate have for the provision of employee financial education please contact your usual contact or one of our strategic benefit consultants on:

T: 01883 332260 or

e: info@wingatebs.com

 

This information is based on our current understanding of legislation which can change without notice.  Professional advice should always be sought prior to making any changes to your arrangements or deciding on any action in this respect. This information should NOT be treated as personal advice or recommendation.

Improving understanding

In our experience many employers rely on information provided during induction periods to educate employees on the benefits they provide. These may be supplemented with periodic communications but the onus is on the employee to read, and more crucially understand the information they receive. In reality, employees don’t always take the time to read the information they receive and if they do, this is rarely truly understood.
Wingate believe there is a responsibility to ensure benefits represent excellent value and deliver the best possible outcomes and to achieve this, employees must truly understand the benefits they receive and the value they provide.  Our service proposition is designed to achieve these goals.

Supporting employees

We encourage employees to contact us in order to help educate them on the benefits they are entitled to receive but also reduce the burden of enquiries on the employer’s HR and management teams.
We offer the following services to support employees:

  • Group benefit presentations or roadshows
  • One-page member guides for each benefit offered
  • “How to claim” guides for healthcare and protection schemes
  • Pension and financial education clinics
  • Webex presentations to groups or individuals
  • Individual consultations on pensions and the broader benefits

Enhancing perceived value

It is estimated that a typical company invests 12% of salary into benefits covering pensions, health and wellbeing. This significant investment is not always valued by employees which creates the risk that the employer’s objectives through offering benefits is not fully realised. In order to attract and retain talent, it is crucial that employees not only recognise the value that the benefits offer but also understand how these support them through their working life and into retirement.

We help employees consider their lifestyle needs, whether immediate or a long way off, as well as events that may not seem important right now. We use a variety of methods to help employees understand how the benefits can support these needs, making their benefits simple, suitable and essential. This could be how a generous employer pension contribution will help to achieve their retirement aspirations, or highlighting the availability of an Employee Assistance Programme when something doesn’t go to plan.

We communicate in a creative way and reflect each organisation’s core values to gain greater engagement to maximise the perceived value of the benefits package.

Below are some of the results of a recent independent employee benefit survey of over 300 employers which we thought may be of interest to you.

Many of the answers highlight the value of an effective online benefit & communication platform, something we can provide via our Wingate PlusYou product. Wingate PlusYou is a straightforward, effective and surprising low cost online benefit platform which we can demonstrate face to face or online and usually provide a no obligation quote for within 24 hrs.

For further details of our Wingate PlusYou product please contact one of our employee benefit advisers on 01883 332260 or at info@wingatebs.com .

Survey Answers

  • 74% of respondents enable staff to contribute to their defined contribution pension scheme via a salary sacrifice arrangement
  • 81% of respondents offer employee benefits because they are an effective retention tool
  • 76% do it as they are an effective recruitment tool
  • 72% do it to support employee health and wellbeing
  • 61% of respondents name the desire to be seen as an employer of choice as a key issue shaping their organisations benefits strategy

 

  • 44% of respondents fund their employee benefits offering solely themselves whereas 49% part fund their offering
  • 50% don’t envisage this funding situation to change

 

  • From the respondents, here is a breakdown of salary sacrifice arrangements offered:
    • 93% offer Childcare Vouchers
    • 78% offer Cycle to Work Schemes
    • 72% offer pension
    • 37% offer Give-As-You-Earn/payroll giving
    • 36% offer holiday trading
    • 25% offer Health Screening
    • 22% offer Gym Membership
    • 17% offer cars

 

  • On the Group Risk side of things
    • 84% offer Death In Service
    • 53% offer Income Protection
    • 36% offer Critical Illness
    • 30% offer Personal Accident Insurance

 

  • On the Health & Wellbeing side of things
    • PMI is offered in 71% of cases
    • EAP in 68% of cases
    • Health Screening in 50% of cases
  • In terms of measuring engagement levels, 69% of respondents do this via a staff survey