This report draws on case-study interviews carried out by e-reward and examines the approaches adopted by nine organisations to the introduction and management of flexible benefits, voluntary benefits and salary-sacrifice schemes.
One of the key themes that shone through our case-study research was that the distinction between flexible and voluntary benefits and between voluntary benefits and corporate discounts is becoming blurred. Each set of arrangements seems to be unique, arising from a combination of historical factors and current expedients.
The nine case studies we feature in this report demonstrate a wide variety of benefits arrangements introduced for a number of reasons, including:
offering staff more choice to better meet their needs
increasing a fairly low level of employee understanding and appreciation of some expensive benefits – this applies particularly in the public sector where the value of relatively generous pensions provision, for example, is not always understood
obtaining better value from the benefits spend
increasing employee satisfaction is seen as an invaluable aid to recruitment and retention
improving the “employer brand”
focusing employees’ minds on the total reward package
harmonising benefit entitlements after a change of business ownership.
In terms of the benefits that can be flexed, the larger companies we interviewed tend to have broadly similar offerings, with private medical insurance, dental insurance and critical illness insurance topping the list in popularity.
Voluntary benefits are now the mainstay of new benefit policies where organisations are seeking to offer employers more choice but feel unable to flex their core benefits. This seems to be the case in the public sector.
With the exception of Kent County Council, which offers voluntary benefits and salary sacrifice only, all those we spoke to had used a consultant to help design, launch or run their scheme
E-reward case-study organisations:
AA (7,000 employees)
British Library (2,000)
Cadbury Schweppes (7,000)
DHL Express (12,500)
Elan Computing (400)
ING Direct (600)
Kent County Council (47,000)
Lilly (2,200)
Westminster Primary Care Trust (1,070)
Download a summary of the report in PDF format by clicking here