Five ideas for a great employee benefits package
This content is for information purposes only and should not be taken as financial advice. Every effort has been made to ensure the information is correct and up-to-date at the time of writing. For personalised and regulated advice regarding your situation, please consult an independent financial adviser here at Castlegate in Grantham, Lincolnshire or other local offices.
Did you know that happiness increases productivity? According to some studies, for each unit of happiness growth (on a 1-10 scale), productivity can go up by 12%. The UK, however, faces a chronic productivity problem as a nation. This is partly explained by a lack of joined-up policymaking and underinvestment. However, how can you – as a business owner – ensure your firm achieves maximum productivity without getting absorbed into this broader social milieu?
Below, our Lincoln financial advisers explain how an attractive employee benefits package catalyses higher productivity. We offer five ideas on how to craft such a package in 2024-25 in discussion with a financial adviser.
To discuss your own business financial plan with us, please get in touch to arrange a no-obligation financial consultation at our expense:
01476 855 585
info@casfin.co.uk
#1 Workplace pensions
When workers consider a new job (or whether to remain in their current role), they are not merely looking at their pay. Without a strong employee benefits package catering to the best workers’ goals, you risk haemorrhaging your highest-quality talent.
Pensions are a great place to start building your employee benefits package. In 2024-25, auto-enrolment rules dictate that you must pay 3% of a worker’s salary to the workplace scheme. The employer must also contribute 5%, which totals to 8%. However, could you do better than 3%?
Could a higher employer contribution attract the talent you are looking for? Does your existing scheme offer sufficient choice in funds for your workers? Perhaps there is a demand for more investment options which align with their values, such as socially responsible funds.
#2 Sick and holiday pay
Employees who work five days a week are legally entitled to 28 days of paid holiday per year. Public and bank holidays can be absorbed into this number. However, most UK employers choose not to include them. Ask yourself, how generous are you with your worker’s holiday entitlement? Do they have options to “buy” extra holiday days or earn them by hitting certain work-related targets (e.g. sales goals)?
Another idea is to examine your sick leave policies. Under the law, an unwell employee must be paid Statutory Sick Pay (SSP) for up to 28 weeks – i.e. £116.75 per week. However, this will be insufficient for most workers to meet their financial obligations. Could you offer more? Or, could you look at other financial protection options via your firm (e.g. group income protection)?
#3 Maternity and paternity leave
In 2024-25, a woman is entitled to Ordinary Maternity Leave in the first 26 weeks after having a child. Additional Maternity leave can be taken in the following 26 weeks. She receives 90% of her average weekly earnings (AWE) before tax in the first 6 weeks under Statutory maternity Pay rules (SMP). After that, for 33 weeks, £184.03 per week is available – or 90% of her AWE (whichever is lower).
A man can claim 1 or 2 weeks’ paid Paternity Leave, which reflects the SMP rules for the aforementioned 33-week period (i.e. £184.03, or 90% of his average weekly earnings). Alternatively, one or both partners may opt for Shared Parental Leave (SPL) and Statutory Shared Parental Pay (ShPP).
This whole area can be very complicated. However, it is wise to consider having a robust Shared Parental Leave Policy for your business. This must meet mandatory minimum requirements, allowing employee requests to be handled effectively.
#4 Death benefits
A big fear of many workers is what would happen to their loved ones if they died prematurely. Here, employers can provide peace of mind with a robust life insurance/assurance package. This protection can be costly for workers. However, it can be economical if offered via a firm.
For instance, older and disabled staff may enjoy greater access to life cover (up to a certain level) without medical underwriting. Another idea is to offer a “death in service” benefit, which typically provides up to 4x of an employee’s salary to their loved ones if they die whilst still on the company payroll.
#5 Medical benefits
These are arguably some of the most sought-after benefits by workers – e.g. private medical insurance (PMI), physiotherapy and mental health support. These can also be useful for employers. For instance, your workers could gain faster access to better healthcare, boosting their chances of returning to their desks quickly.
Staff can also access mental health support more easily (and for free), letting them process difficult feelings and situations that may inhibit their performance at work. Financial worries can also be processed via group presentations and 1-to-1 engagement.
Conclusion and invitation
Selecting the ideal range of employee benefits is not always easy. You must carefully consider what your organisation can afford, what workers value, and what the competition offers.
Once the package is crafted, it will be vital to communicate its benefits effectively across the organisation. Engagement with the package should also be monitored. Further discussions with your workers could influence how benefits are shaped going forwards, as staff needs and economic conditions evolve.
If you are interested in discussing your own financial plan or investment strategy with us, please get in touch to arrange a no-commitment financial consultation at our expense:
01476 855 585
info@casfin.co.uk
Adam Thompson
Financial Planner
Adam has worked in the financial services sector since graduating from university in 2015.
Email: Adam.Thompson@casfin.co.uk
