Around 5 Billion* a year is being wasted on under-valued employee benefits

Around 5 billion* per year is being wasted on under-valued employee benefits that could be better paid as salary to improve motivation among younger members of staff, says Adrian Humphreys of employee benefits administrator, WPA Protocol.

His observation follows a recent NOP World survey, which showed the majority (63%) of people within companies responsible for providing benefits, think that the impact of their benefits ’offer’ on the career decisions of their junior employees, ranges from ambivalent, to not at all important.

In contrast, when asked to rank the importance of the benefits package to more experienced employees, 96% said the benefits package was either fairly or very important.

WPA Protocol concludes that these findings are a further nail in the coffin of the ’one-size-fits-all’ universal benefits package and that savvy employers should be questioning the benefit, both to themselves and their existing/potential employees, of a standardised reward package.

When asked which benefits they would consider cutting first if looking to reduce costs, just over a quarter (27%) said a company car, 14% said pensions and 11% said healthcare provision.

The research endorses what switched-on employers have already acted upon; that benefits need to be tailored, particularly for the highly skilled knowledge workers who will, in the next two to three years, form the bedrock
of the UK economy. In particular, smaller, innovative companies are offering enhanced salary only packages, allowing employees to source their own portable benefits independently. Commenting on the results, Adrian Humphreys, Chief Executive of WPA Protocol Plc, said: Employers in the UK are at a cross-roads. Cost containment is key and with the cost of benefits escalating annually, switched-on employers are recognising the need to re-evaluate the way in which they remunerate their staff. The further we move towards a knowledge-based economy, the more
important it will be for employers to know that they’ve got the right benefits package in place to motivate and retain good people, at a price they can continue to afford.

NOP World Business conducted 100 interviews with HR Directors/Managers amongst the top 1500 UK companies.