There was a time when the salary package was enough to retain employees for years. Companies are now offering various fringe benefits along with a handsome pay to keep their employees motivated. However, small businesses cannot afford many of these benefits because of the limited operational budget.
You can still manage to offer a few of these benefits to the best performing employees in your organisation. Employees will stay with your company for longer durations if you make them feel valued. Here are some fringe benefits you can introduce to increase employee retention in your organisation.
There are many tests and treatment that are not covered under the NHS. By offering healthcare benefits, you are providing your employees with better treatment without wasting hours in a queue. They will recover faster and resume their work.
Thus, productivity will increase, and there will be less absence cost. Healthcare benefits are an incredible tool to increase staff loyalty and create a caring reputation for business.
Income protection is a facility that provides monthly income to the employees that are unable to work. You might have to pay from 1.25% to 1.5% of the payroll from your purse. Also, you will be legally obliged to continue paying for the other benefits, including pension contributions and National Insurance.
Money is one of the biggest motivations for many employees, especially the sales division. Offer cash benefits to people who complete the target for the month. It will give a boost to staff motivation, and the employees will work harder to achieve the targets.
Many companies chose to offer a lower salary package and more handsome cash rewards. It is beneficial for both entities since you need to pay only if the other person has made more profit for the organisation.
Your staff needs time for their personal life to maintain the work-life balance. Offer your employees paid holidays for at least 28 days. You can include the bank holidays in it.
A vacation or holiday now and then will relax their body and mind. Giving them a reason to not look for other options.
Both male and female employees play a vital role in the early days of an infant. You can use this time to gain loyalty by providing extra support to them. Every business must follow the government guidelines for the minimum leave entitlement. Another week or two from your side will make them respect you more.
Offer special savings account for the childcare to new parents. This will help the employees save for the future of their kid. You can also provide childcare vouchers to the staff.
Not every employee wants the benefits company is offering to them. You can let them chose the benefits from a menu of options. Based on their preferences, you can cut a certain amount from their salaries.
To implement a flexible benefits scheme in your company, you need to create a package with benefits and services. Flexible programs are gaining popularity in recent years with new companies signing up for it.
Cycle to Work
You can offer your staff bicycles for travelling to work. The employee signs a lease for 18 months. At the end of the lease, they can purchase the bicycle at a fair market price.
The employees can save a good amount of money on the income tax with this scheme. You can take loans for bad credit with no guarantor and no fees to cover the initial expenses of this scheme.
Small businesses and startups rarely offer pension benefits. Those who offer it rank among the most reputed organisation around in the business. These schemes come with legalities that may take time to understand.
These are the four main pension schemes offered by employers:
Money Purchases Schemes
A part of employees’ income is invested into a fund by the employers in money purchases schemes. After retirement, the money in the fund is used to buy an annuity. It provides regular income for the rest of life.
There is a risk of share market collapse that is taken by the members. The contribution from the employer is fixed.
Final Salary Schemes
Final salary schemes, as the name suggests, pay employees an amount based on their last drawn salary. Their basic salary without any benefits or bonuses and the length of their tenure is considered to come up with the pension amount.
Your business takes a financial risk here. Any deficit will require additional funding from your side. Keeping in mind the inflation, life expectancy and stock markets, this scheme favours employees more than the organisation.
Stakeholder schemes are a cost-efficient solution for companies to offer their employees pension. You don’t have to pay any amount to the fund. The members take all the risk with their investment.
However, you must maintain employee deductions and payment record accurately. The employees are offered a payroll deduction facility that facilitates the contribution process.
Group Personal Pension Scheme
Group Personal Pension Scheme is a group of pensions for individuals that are built by every member. You need to implement a payroll system to manage contributions and transfer it to the service provider. This scheme doesn’t require an employer to pay any amount unless the stakeholder scheme is not present.
The service provider takes care of the full implementation and administration. However, employers are liable in case the employees are unable to make payments.
In the end, your resources and budget define which benefit scheme is best suitable for your business. You can take advice from the employees to narrow down the search. However, these schemes are sure to increase the staff motivation, ultimately, the retention as well.