How to offer benefits other than a pay rise

Some low-cost or free working benefits will go a long way in making your employees feel valued. Charlotte Rees-John rounds up some ideas

 

In recent years, there have been some startling statistics about employees’ financial wellbeing and the impact this has on the workplace. One survey found that 70% of employees reportedly admitted to wasting a fifth of their time at work worrying about their finances, and in another, one in four said financial concerns impacted their ability to do their job.

 

The cost of living crisis has exacerbated this trend. Employees are becoming increasingly worried about whether their income will go far enough to support the basics of life and how long it will take before inflation starts to come down.

 

Given that employees now report financial stress as the highest cause of stress outside of work and 15% of employees consider that financial stress causes a decrease in their productivity, there’s not only a moral argument for supporting employees more comprehensively to manage their financial wellbeing, but a business argument too.

 

One issue for employers is keeping up with the rate of inflation. The Office for National Statistics reported at the end of 2022 that while average regular pay among employees increased by 6.4% between September and November, on average employees still faced a real terms pay cut of 2.6% since the start of the year.

 

You may need to think outside of the box in order to be able to support employees without compromising the financial security of your business. One of the first points to consider is whether employees are aware of the benefits you already provide. These might include free or discounted prescription glasses or eye tests, healthcare, a cycle to work scheme, assistance with travel costs and mental wellbeing support. Reminding employees what you offer, where they can access information about these and encouraging them to use existing benefits doesn’t cost anything.

 

You might also consider offering additional, alternative benefits, the extent and nature of these will depend on your set up and whether you can contribute towards the cost, but it is always worth bearing in mind that some benefits cost nothing or very little.

 

One-off cost of living bonuses

 

You might not be able to commit to making pay rises across the board, but you may be in a position to make a one-off cost of living bonus to support your employees and help them feel valued.

 

Flexible work to reduce commuting costs

 

If you don't already do so, consider allowing those staff who can to work flexibly so that they can reduce their travel costs and make days in the office productive and worthwhile.

 

You could also consider introducing a four-day working week or allowing staff to work compressed hours to give them more free time and reduce commuting costs. A recent study has indicated that a four-day week does not impact on productivity and, in many cases, employees are motivated to work harder in exchange for a shorter working week.

 

Direct staff to reliable information

 

Another cost-free or low-cost way to support financial wellbeing directly is to signpost employees to useful resources to help them manage their finances. The Money & Pensions Service offers free advice on this and there are a variety of useful courses online.

 

Provide an additional day's holiday

 

Rewarding all staff with a day of leave to allow them to focus on their wellbeing, or an additional day’s holiday, will demonstrate that you recognise their hard work. Alternatively, you could allow employees to give back a certain number of days’ holiday and be paid for that time. You must ensure they still take at least four weeks’ leave each year.

 

Provide a salary sacrifice scheme

 

Salary sacrifice schemes, where employees sacrifice pay for a non-cash benefit, can help with the costs of green energy and childcare.

 

Meal subsidies and other benefits

 

Take a leaf out of John Lewis’s book and offer staff hot meals during their shift or you could provide tax-free rebates (where possible) to offset some of the costs of working from home, such as broadband and home-office furniture. You might also be able to provide staff with reduced-cost access to the products or services your company provides.

 

You could alter the benefits you currently offer to suit your employees’ needs. Since the pandemic, health-related benefits have been increasingly important to staff (particularly being able to access online GP advice) as well as benefits such as pet insurance.

 

However you decide to assist your employees through this difficult period, we know that demonstrating your commitment to them is essential if you want to retain and attract talented staff. Wellbeing isn't just about pay and benefits – your staff may also want a career structure that allows them to develop and move on. They will want to be recognised for their achievements and will want to work in a decent environment where they feel respected and valued. These concerns should not be an afterthought when considering your recruitment, retention and wellbeing strategies.

 

Charlotte Rees-John is a partner and head of Irwin Mitchell’s consumer sector