Whether we like to admit it or not, most people still retain some element of a child’s-eye view of Christmas. This is no different for the boys and girls of the HR world, who each year are offered a range of beguiling recruitment and retention tools, and are required to reduce their wish-list down to a few essentials that the parents (in this case their employers) can afford.
As with all toys, the list changes markedly over a relatively short period of time. This has most certainly been the case in the world of employee benefits, and since we are now at the end of the ‘noughties’, let’s look back at what was filling HR stockings over the period since the millennium, before we unearth what members of the trendy HR set now crave for the coming decade.
It is fair to say that in 1999 we were in a different world. The Labour government was newly-elected (relatively), the dot-com bubble had yet to burst, and Britain was both trendy and booming. These elements led to the HR Christmas stocking being packed with potential goodies. The big presents were either going to be a pension for all (courtesy of stakeholder pensions) or flexible benefits for the really rich kids. In reality, the batteries were not always included with either present, and to a large extent both have failed to fully embed in the corporate market for many employers.
Other ‘fad’ benefits of the past decade are also worth a look. Absence management programmes almost took off, but appear to have fallen away again as some employers recognise that the impact on staff morale of a badly-run programme can be more expensive in the long run than the cost of the absences they are seeking to limit. Employee assistance plans (EAPs) are still around, as are cycle-to-work and childcare assistance, although these may suffer if the government seeks to limit or remove the tax breaks inherent in such products.
Fast-forward to 2009: what’s on the Christmas list this year?
The world has changed: Santa has limited cash to splash on us, so we need to choose wisely. A good present will be one that rewards the employee, but crucially helps the employer with tangible recruitment and retention appeal as well. We also need to be mindful of minimum moral and legal duties for employers. With this in mind, I suggest that Santa’s list should look like something like the following, for many.
The rich kids down the road are all looking at corporate wraps as the next big thing. Certainly this is a much better spend of employer money than personal accounts, but the running of such an arrangement may be too onerous for many employers, at least until the product has developed further.
For most, therefore, finding a solution to the expense and administrative hassle of personal accounts and auto-enrolment should be the key priority, and early planning will help spread the cost for the employer too.
The practical toy
Never the most wanted, but usually the most used over time, the practical toy should be a key part of the list. I would strongly suggest that those employers with closed defined benefit (also known as final salary) schemes look to find exit solutions as a priority concern. It is vital to work towards an end-game, and de-risk the scheme en route where possible, as otherwise such schemes can have a damaging (potentially fatal in the current economic circumstances) effect on the employer’s finances. Taking these practical steps need not be too expensive, and reviewing the costs associated with running the schemes can potentially save significant costs for the employer over a number of years.
The other practical toy that many are now considering is the introduction of a share plan for employees. With share prices still generally low following last year’s stock market collapse, these are liable to provide good return for employees, and act as a strong recruitment and retention tool (and it is important that employers hang on to talent in these difficult times).
Since we are in straightened financial circumstances at present, stocking fillers will take on a new importance. I would still suggest that a well-run EAP remains good value for money, helping the employee and also providing the employer with some useful armour in the event of a tribunal.
Beefing-up return to work interviews and linking findings with benefits on offer is also a potentially cheap fix. Voluntary benefits remain a no-cost benefit for staff, and if used correctly can be disproportionately appreciated by employees.
Many of these stocking-fillers are sometimes already on offer to employers in other products. It may just be a question of reviewing what you already have in place to find a free present for your little ones.
One final, but important, present remains stubbornly stuck in the toe of the stocking. My final stocking filler would be in the area of financial education. This could be in the sophisticated areas of financial planning and advice, but equally, advice on everyday subjects such as spending habits and savings. This can significantly help employees, at minimal cost to the employer. A survey by the Financial Services Authority found that financial education could be many times more effective than a pay rise. At a time when pay rises are limited or non-existent, this may be the best present of the lot to keep your staff happy until better financial times return.