Where to start with employee benefits (and why)

A new study highlights the value of employee benefits to SMEs and their employees.

For SMEs, the balance between boosting the bottom line and ensuring employees are paid fairly is something of a tightrope.

Margins can be smaller than for larger enterprises, so the question of how to keep both financial equity and employee motivation is crucial to the company's health and sustainability.

A new annual report from the CIPD - UK Working Lives:  The CIPD Job Quality Index - seeks to review, understand and measure what it is that makes a workforce content.

Job quality

Compiled alongside YouGov, the survey targeting 6,009 workers.

It found that overall, work has a positive value on people's lives.  Almost half (47%) do not think that 'a job is just a way of earning money', whereas 34% agree with the statement.  More than half (59%) say they would enjoy having a paid job even if they did not need the money¹_.

The survey found that 64% of people were satisfied with their job overall - while just 18% stated that they were dissatisfied²_.

Despite this, there were various issues picked out across the topics of pay and benefits; terms of employment; job design; social support; health and wellbeing; work-life balance; and representation.

The key factors

The survey found that health and wellbeing is the single most important aspect of job quality in terms of key outcomes³_.

Tied to that, away from pay and pensions, the most valued benefit is health care and insurance (ranking ahead of softer benefits such as social, transport and technology perks⁴_.

Unsurprisingly, satisfaction over pay is a sliding scale - senior managers are the most satisfied with their remuneration (58%) while semi-skilled, unskilled and casual workers are the least satisfied (33%)⁵_.

Where to start

Pay and pensions will always be powerful motivators for any workforce.  But it is far from a fix-all solution for SMEs to simply up salaries across the board.

Recent changes in employment legislation have already forced employers to pay out more to workers.  The British Chambers of Commerce found that 4 out of 5 UK businesses have seen staff costs rise.  75% saw increases as a result of pensions auto-enrolment; 50% due to the National Living Wage and 20% because of the Apprenticeship Levy⁶_.

For SMEs, that can be a big price to pay.

Considering the high priority placed on health and wellbeing by employees - and health and insurance in particular - a more efficient way of boosting job satisfaction and increasing that job quality index score could be to focus on employee benefits.

As a starter, Group Income Protection is a wide-ranging option for employees, funded by an employer's manageable monthly premiums.  The coverage helps employees when they need it most - when they are unable to work through sickness or injury, as well as offering rehabilitation support.

And the coverage can be tailored according to the company's financial means.

Sources:

Unum

^{1,2,3,4,5 CIPD. (2018). UK Working Lives: The CIPD Job Quality Index, p5-43}

⁶ BCC. (2017). Workforce survey 2017