Attracting and retaining: the role of flexible benefits
Recruitment and retention of good, skilled staff is a challenge for most employers, whatever the sector and whatever the economic climate. This has led to the increasing importance of having a reward package that is as attractive to existing staff as it is for new.
To respond to these changes, many employers are giving serious consideration to the adoption of flexible benefit schemes. This is a method of providing a range of benefits to employees and allowing them to build a portfolio of benefits to suit their own personal circumstances. The power comes from the control that it gives to employees and the change of focus that it creates; away from the cash element of a package to the value of the total reward.
It does seem though that cash remuneration and benefits can play a significant part in the employee’s feelings towards a company – their loyalty and engagement. So, an employer needs to get the mix of benefits right and also the level of choice around each of these. It is no good just having a list and expecting the employees to be happy. The employer needs to research the needs and desires of its workforce and make sure any scheme can meet these, as far as possible. In this way, interaction between the scheme and the employees may increase, and in turn, the sense of commitment from the employees.
This again can mean reduced turnover and better retention, and saving on recruitment costs.
So, in order to increase employee engagement and therefore improve retention levels, an employer can implement a flexible benefits scheme, taking account of employee feedback it has: ensuring that it will meet their requirements.
But it is not just enough to put a scheme in place, it needs to be effectively communicated if employees are to really understand it and the benefits it can offer them. Put simply, if employees do not understand the employee benefits that are in place, they can’t value them, which in turn means that a company fails to deliver their requirements. Employees will then not participate, resulting in a low take-up rate. The knock-on effect is that there would be no improvement in engagement and the risk of no impact on employee retention.
To be effective the communication should be:
- brief (each time)
- tailored to its audience: employees are interested in matters affecting them personally, so the more a company can target the information individually, the more buy-in it will achieve
- championed: if someone known and respected believes in the scheme and can put forward their case study, others will buy in too.
A message repeated in the same way becomes monotonous and may be filtered out by the audience. Something new and fresh will catch the eye and gain the attention of the employee. As well as changing the message to keep it fresh, delivering the same message in different ways, using multiple media, will have a beneficial effect. It should also be remembered that people forget about 80 per cent of information immediately after they receive it. Repeating a message over and over, especially in a new fresh way, gives a better chance that more is retained and, importantly, used.
The bigger picture
But how do we really know if a flex scheme does aid retention?
It seems to be portrayed as ‘fact’ that a flex scheme improves retention but there is little or no hard data to prove this. Rather than subscribing to the view that the absence of fact means it must be untrue, I think the truth probably lies in the fact that the impact is difficult to measure.
Flex is not a magic wand that solves all. It’s part of a multitude of good measures that you can put in place to help keep your best people with you. The power that it brings can be measured by how your employees will perceive you in terms of factors such as openness and engagement.
It is therefore important that a flex scheme does not sit in isolation when considering the effect upon retention, but complements other rewards in place: such as career development, the working environment, work/life balance.
It is unlikely to be the Holy Grail of retention on its own, but will be welcomed as part of your wider plans to demonstrate just how much you value your people.
Julia Turney is Head of Benefits Management Jelf Employee Benefits