HR leaders plan benefit changes to help attract and retain employees

Businesses are becoming increasingly aware of the measurable impact that benefits have on employee engagement and productivity, new research suggests.

In the latest Benefits Strategy & Benchmarking Survey from insurance, risk management and consulting services firm Gallagher, 45% of HR practitioners in the UK said they plan to change their current benefits offering amid a highly competitive labour market.

Among those planning changes, 72% are seeking to enhance benefits and 47% want to improve flexibility in benefits, to extend individual choice.

"While cost is always central to business performance, we are seeing a shift in the market as employers are having to compete for talent in a very diverse workforce," commented Leslie Lemenager, president of Gallagher's International Employee Benefits Consulting and Brokerage. "The fact that 47% of organisations are aiming to enhance flexibility in benefits provisions -- despite cost management being their biggest challenge -- points to a strong recognition that there is a need to go above and beyond to attract and retain talent."

The survey of over 170 UK-based employers found that only one in five currently allow employees to customise their individual benefits package, and customisation is available for only a few benefits, such as contribution levels to retirement savings plans.

It's also important to offer a wide range of benefits that appeal to a diverse workforce. The survey found this to be the second most commonly cited obstacle to sufficient benefits provision, with two-thirds (66%) of HR professionals identifying it as a major challenge.

A surprisingly high 52% of organisations do not allow employees to work from home, and other benefits that suit a diverse workforce are also uncommon: only 43% offer a condensed working week; just 24% offer agile working; and just one in seven (14%) offer term-time only working.

If organisations want to set themselves apart, flexible benefits and flexible work are "excellent places to begin", Gallagher concluded.