Pensions re-enrolment and the changes in the law governing salary sacrifice are the two main reasons employers are planning to review their overall benefits package, according to new research.
A poll of over 250 medium and large employers by Jelf Employee Benefits found 51 per cent intend to review their overall benefits package this year.
The recently announced changes and limitations of many benefits using the salary sacrifice mechanism was a clear area of concern for employers, with 24 per cent citing it as the key reason why they were planning an employee benefits review.
A further 24 per cent said the requirement to revisit auto-enrolment every three years and undertake a re-enrolment process was their principal reason for instigating a review.
April 2017’s introduction of tax-free childcare was the prime reason for review for 14 per cent of respondents, while increases to Insurance Premium Tax from June this year were prompting 8 per cent to review their benefits. A further 4 per cent cited the recent launch of the Lifetime Isa as the trigger for a review.
Jelf Employee Benefits head of benefits strategy Steve Herbert says: “Despite the political uncertainties of the past few months, the reality is that there is already much legislation-led change in progress that impacts, directly or otherwise, the overall Employee Benefits offerings of so many organisations. It is therefore important that employers are aware of these changes and adapt their offerings accordingly.”
“The delivery of a robust, relevant and effective benefits package is an important component of any remuneration offering, and that this is increasingly significant for a country facing the uncertainties of Brexit.
“The reality is that the UK’s productivity figures are worse than many of our major competitors. If British business is to continue to thrive, then this measure will need to be improved. A robust and well thought-through employee benefits offering can help employers manage and improve absence figures, succession planning and importantly employee engagement. All these are key components in improving productivity, and we would therefore strongly encourage employers to undertake a full benefits review to ensure their offering meets these objectives.“
Do you intend to review your Employee Benefits offering in 2017?
Yes – 50.57%
Possibly – 34.98%
No – 7.22%
Don’t know – 5.70%
We have no benefits offering – 1.52%
Which of the following changes is most likely to result in your company undertaking an Employee Benefits review this year?
Three year Pension Auto-Enrolment review – 24.22%
Salary Sacrifice Changes – 24.22%
Introduction of Tax Free Childcare – 13.67%
Increases to Insurance Premium Tax (IPT) – 7.81%
Introduction of Lifetime Isa – 3.52%
Other – 13.67%
Don’t know – 9.38%