Staff retention in a competitive job market

The current hot topic of conversation across many boardrooms in the north east is the recruitment and retention of staff. Principally due to a vibrant oil industry the north east economy is booming. In recruitment terms this means that those looking to move jobs are in a strong position. It is not just companies working directly within the oil and gas sector that are finding it difficult to recruit and retain members of staff but also the companies that service them. Kudos Independent Financial Services is advising employers of the need to use remuneration packages to both attract new staff and to retain existing staff.

ìEmployers need to remember that remuneration packages need not just be made up of the salary and bonus figure,î says Jim Tennent, managing director of Kudos Independent Financial Services. ìAlthough this is obviously one factor that will help in both attracting and retaining staff in a competitive job market employers need to consider what other elements they can offer employees in order to get the right calibre of person. It is worth bearing in mind that when employing at a senior level offering a higher salary is not necessarily going to be as attractive as it might as first appear.

Jim explains, ìIf someone who falls into the 40% tax bracket is offered a 10,000 salary increase then due to tax and National Insurance Contributions their net salary increase would be less than 6,000. People in this position are far more likely to be interested in the other elements that make up their remuneration package. Pension contributions are a more tax efficient way of rewarding such employees. This is also a more cost effective option for the employer as it results in a saving in terms of National Insurance Contributions.î

Recent research showed that 82% of companies agree that a good benefits package attracts and retains high quality staff. According to Jim there are many elements that can be included within a top quality employee benefits package. ìAll too often employers think that employee benefits packages are limited to items such as pensions and death in service schemes. The range of benefits that are available these days can be tailored to fit the individual company. Elements that employers can consider for inclusion in an employee benefits package include income protection, private medical, critical illness, car allowance etc.î

Jim continues, ìEmployers also have the option to offer employees flexible benefits whereby, within reason, the employee can tailor their own employee benefits package to suit their individual circumstances.

ìA key element in fighting the battle to retain members of staff is ensuring that they understand the total value of their remuneration package. Far too often employees only fully appreciate their remuneration package when they join a company. Once an employee has been with a company for a while they tend to only think of their remuneration package in terms of their salary figure ñ after all this is what they see on their payslip each month.î

Jim adds that employers should consider methods of reminding employees about the total value of their remuneration package. ìWe have worked with companies who offer extremely comprehensive employee benefits packages but omit to remind their employees of the total value of their remuneration package. By failing to do this they are potentially leaving themselves open to losing personnel.

ìEmployees are more likely to remain with an employer if they feel valued and looked after. This can be achieved, in part, by regularly communicating their total remuneration package value to them. There are various ways which can be used to achieve this goal; these include via an online system, a DVD or CD-Rom or by making presentations to staff. The important thing is to reiterate all of the elements that make up the remuneration package so that employees understand and appreciate the value of their total package.î