Employee recognition | How to get more value for less benefit spend

How to get more value for less benefit spend

By Roger Fairhead, Group Reward Director at Legal & General

Did you know that for the average amount a company spends on one-off perks – such as celebrations and vouchers – you could put in place a programme of essential salary, personal asset and life protections, including mental health and wellbeing services, for all of your employees, and still enjoy some change? One-off perks can be useful in times of high employment but, still, they’re fleeting and forgettable. Employees want more.

The days of punching a clock, receiving a pay cheque and keeping life and work separate are long gone. Work life boundaries have all but disappeared. Now, employees want to know that their employer cares; that they have their best interests at heart. The pandemic has served to fast-track all these trends. In short, the time is ripe to assess whether your benefit programme is best placed to deliver genuine long-term value in terms of happy, healthy and motivated employees; whatever the size or shape of your company.

There’s a common misconception that protection products – namely group Life, Income Protection and Critical Illness Cover – are expensive. But research shows this just isn’t the case.

Statistics from group risk industry body GRiD, reveal that employers pay on average £950 per employee a year on one-off rewards. Compare this with the average cost of group risk benefits per employee: group Life £133; Critical Illness Cover £200; and Income Protection £313. A grand total of £646.1

Meanwhile, employee awareness of the benefits of protecting life, income and assets has never been higher. The UK has experienced the biggest Income Protection programme ever seen, in the shape of furlough and this has led to a quarter of UK employees wanting to be offered Income Protection by their employer.2 Now, the impact of a drop – or total loss – of salary is understood all too well by many. So is our own mortality, whatever our age and current state of health. Additionally, it’s been brought home to us that state support is limited.

Three in 10 (30%) of those who’ve used group Critical Illness cover said they valued it, because in the current climate they are concerned about the pressure on NHS services, so they want to protect their health the best they can.3

Expectations of employer support with regard to wellbeing – whether financial, emotional or social – were high amongst employees pre Covid-19, but in many cases, it has taken a global pandemic to ensure this is on the leadership agenda. Now 9 in 10 CEOs believe wellbeing initiatives are key to driving long-term changes to their business model.4

People trust - and want - their employers to look after their wellbeing.

In fact, over half, (53%) of employees said if they were looking for a new role, a prospective employer’s policy or approach to supporting the mental health and wellbeing of its employees would impact their decision to apply. For recent graduates, that increases to a huge 9 in 10 (88%).5

In short, the occasional celebration or gift voucher is nice, but knowing your employer has your back during life’s downs, as well as ups, and nurturing self-care and peace of mind by giving employees the tools, the wherewithal and the reason, is arguably much more valuable.

Find out more about our how we can support the wellbeing of your employees.

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Sources
1  - GRiD 2019 employer research
2 - Hooray Health and Protection
3 - Research conducted by Opinium on behalf of Legal & General in November 2020, involving 1,087 UK employees who have access to either group IP, CIC or EAP.
4 - PwC CEO Panel Survey 2020 – UK Findings, August 2020 https://www.pwc.co.uk/ceo-survey/ceo-panel-survey.html
5 - Research conducted by Delineate on behalf of Legal & General in September 2019. 1,000 employees with a minimum of 5 years’ employment, and 1,009 graduates


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Legal & General

Established in 1836, Legal & General is one of the UK’s leading financial services groups and a major global investor, with international businesses in the US, Europe, Middle East and Asia. With over £1.1 trillion in total assets under management at 30 June 2019, we are the UK’s largest investment manager for corporate pension schemes and a UK market leader in pensions de-risking, life insurance, workplace pensions and retirement income. We have also invested over £22 billion in direct investments such as homes, urban regeneration, clean energy and small business finance.