Three out of four HR and finance directors are looking to review their employee benefits package as a direct result of the Covid pandemic.
Speaking at a panel at the Corporate Adviser Pension Summit, Howden Employee Benefits head of benefits strategy Steve Herbert said this recent survey showed the effect of the recent health crisis on the benefits market. He added that it reflects the fact many benefit package not as comprehensive as companies would now like.
Herbert says that company faces a “very tough six months”, but business those survive this period will be in a stronger position – but with a knowledge they need to protect their employees.
As he pointed out employee benefits have delivered for businesses during this period of crisis, with group life, for example paying out £57m in life claims.
“Many of these companies would not have had the financial resources at this time to pay any type of compensation to these bereaved families. This demonstrates the benefit of these products.”
James Biggs, partner at the Employee Benefits Collective, agrees this shows the value of the investment in employee benefits. However he says there is likely to be a move away from the ROI (return on investment) calculations, as it is often extremely difficult to prove exactly what return get for each pound spent.
Both consultants agreed there will be a focus on getting core benefits right.
These are important when it comes to protecting staff, helping recruit and retain talent, boosting engagement levels and connecting with corporate purpose, Herbert said
He added that despite corporate budgets being under strain, he did not anticipate any particular increase in the provisions of voluntary benefits.
Professor Adrian Furnham, whose specialists in the psychology of work, money nad behavioural economics said he had been surprised, looking at this area how the benefits people valued changed very little depending on age.
Herbert says there were some ‘cosmetic differences’ between younger and older age forces, but across these generations they looking for protection for themselves and their families along with help with retirement.
Given the widespread problems caused by Covid-19 Herbert adds that he does expect more of a focus on low cost payroll lending in future.
“Even if companies survive the next six months there will be a lot of families in a degree of financial hardship and debt as a result of this pandemic. This is a way of companies to make a real different to employee wellbeing.”
When designing benefit packages Furnham added that employers increasingly need to look at the intrinsic rather than extrinsic factors that motivate employees.
While money is an external motivator, he pointed out it can paradoxically demotivate employees, particularly if they perceive their salary to be less than colleagues.
He says that Covid has accelerated many trends in the market, particularly in relation to more flexible working patterns and use of technology.
“Autonomy, security and encouraging a sense of purpose and mastery can be intrinsic motivators and in some cases a better predictor of happiness and wellbeing in the workplace.”
There are both positive and negatives when it comes to a more flexible workforce that is increasingly working from home, and the challenge for manager is to be aware of both he says.
When it comes to benefit packages many group risk and health product have added remote options, such as virtual doctors apps and mindfulness apps.
While these can be useful in connecting people with clinical health services Furnham says that research suggested that there were limitations this technology. “The people who need them most, tend to use them less. And healthier happier employees tend to use them more, particularly when it comes to conditions such as anxiety and depression. This is a challenge that managers need to be aware of.”