Benefits Connection: Issue 2, June 2007

benefits connection

Insight, strategy and best practice in employee benefits from Asperity

COSTS IN CONTEXT Are you seeing the wood for the trees?

ISSUE 13 / OCTOBER 2011 Also in this issue: • Utilising social media in benefits communication • Is the elephant in the room green or white?

• Myth-busting methods for CCV engagement

benefitsconnection

WELCOME Financial instabilities continue to impact on most organisations in the UK and many will be checking, double-checking and triple-checking their financial models and continually reviewing budgets over and over again in case they’ve missed any possible areas of ‘cost-slimming’.

When this happens, it is often the ‘nice-to-haves’ that get the chop first and foremost. Things like employee discount programmes, for example. But what if we told all the FDs and CFOs of this world that doing so would mean cutting your single most valuable benefit from your company’s portfolio? Well, then I’d imagine the sword might well swing round and fall elsewhere for the time being.

It is worth taking a step back sometimes and looking at the whole spectrum of benefits your company offers, to see the true value of them. I guarantee you will be surprised at the comparative value of each benefit. The next time your CFO tries writing off voluntary benefits as expendable, show them - with concrete evidence, of course - just how much value your employees are getting from it, and how relatively little cost it is to the company. And if your staff aren’t valuing it at the moment, call on your provider to make sure they are doing all they possibly can to drive engagement. It’s their responsibility to make your scheme sing, and your responsibility to prove its worth to its opponents.

CONTENTS Contents and Editorial

2.

Costs in context

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Utilising social media in benefits communication

4.

Myth-busting methods for CCV engagement

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Is the elephant in the room green or white?

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Case Study: The Children’s Society

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Visit www.asperity.co.uk for more information and free, fully functional demo access to Reward Gateway.

Glenn Elliott MD, Asperity Employee Benef its glenn@asperity.co.uk

All information correct at the time of writing and subject to change without notice.

Asperity Employee Benef its Ltd, 90 Westbourne Grove, London, W2 5RT. Tel 020 7229 0349 www.asperity.co.uk email: benef its@asperity.co.uk © Asperity Employee Benef its Ltd 2011.

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COSTS IN CONTEXT How do you achieve a balance between providing something that’s worthwhile and not breaking the bank?

By Andrew Smith

When you’re running a business, you know that keeping costs down always needs to be considered carefully when thinking of introducing new benefits for your employees.

The question is, how do you achieve a balance between providing something that’s worthwhile, and not breaking the bank?

When you’re taking that leap of faith to implement something new, you want to be sure you’re getting return on your investment, but you also want your staff to engage with the benefit and appreciate what you’ve put in place.

If you look at the spectrum and associated costs of providing a comprehensive benefits package, and then break it down into the individual costs, you can analyse cost against potential return of a range of benefits a typical organisation might offer. By putting cost into context, the aim is to rationalise why it’s advantageous to put some of the lower cost benefits in place, and to illustrate how your return on investment might manifest in better employee retention and staff wellbeing.

Beginning at the higher end of the spectrum, pensions are by far the most costly benefit that might form part of your employee benefits package. Depending on the type of scheme on offer and the number of people to take it up, a company with 1000 employees can expect to pay over half a million pounds a year to fund their pension scheme.

Though not all companies will offer their staff PMI, an alternative Healthcare Cashplan might cost anywhere between £80 and £170 per head, depending on the cover limits available. And if you offer health insurance on top, at an average of £100 per employee per year, that’s an extra £100,000 for 1000 employees.

Turning now to some of the seemingly inconsequential benefits, the staff Christmas Party alone might cost £40 per head, which continuing with the example company of 1000 employees, equals a total annual cost of £40,000. Complementary tea and coffee for a workforce of the same size is likely to cost even more, with a moderate projection of £50 per employee totalling £50,000 for the year.

After spending over a million pounds annually on the bare essentials detailed above, it’s easy to understand why it can be difficult to embellish your existing offering with further benefits from a budget point of view. Yet by putting cost into context, it may be useful to compare the cost of potential benefits against your existing package when looking to put new ones in place.

Employee discounts are likely to be the cheapest benefit an organisation can provide. At just a few pounds per head, the cost is significantly less than your annual tea and coffee expenditure and can even offset your other costs such as salary, by maximising employees’ disposable incomes.

PMI, pensions, the Christmas party and tea and coffee are all largely expected and are highly desirable. Employee discounts on the other hand are always going to be ‘nice to haves’ - not crucial retention or recruitment tools. But, for a few pounds per employee per year, discount schemes are a cost-effective, high-profile, nottaken-for-granted addition to the compensation and benefits package.

In comparison to other benefits, employee discounts are also quicker and easier to implement, with a dedicated account manager available to help you every step of the way with tailoring, communications and usage statistics.

A good programme will support your employees with a helpdesk with long opening hours, to deal with any enquiries or issues - further removing any source of burden from HR teams. Pensions and the like are often admin-heavy and can be a somewhat painful process to put in place. And the thanks you receive from employees for going through the process is minimal.

The value for money of an employee discounts scheme like Reward Gateway, therefore, is clear to see to the point of almost being too good to be true. The return far outweighs the investment of both time and resource in ways incomparable with any other employee benefit.

Andrew Smith is Chief Financial Officer for Asperity Employee Benefits. Comments? Send them to andrew.smith@asperity.com.

But there are other things to consider when comparing the relative costs of employee benefits. For a start, which ones will your employees actually appreciate?

Another high end benefit is Private Medical Insurance, at the approximate cost of £300 per employee per year.

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UTILISING SOCIAL MEDIA IN BENEFITS COMMUNICATION

By Alex Bailey

It’s taken a while to get here, but HR and reward and benefits professionals seem to have finally grasped the importance of communicating their benefits programmes effectively to employees.

But, just as some are getting to grips with distributing posters, running competitions, and sending information direct or by e-mail to employees, the world of benefits communications has stepped up a gear once again to incorporate social media.

Love it or hate it, social media such as Facebook, LinkedIn, Twitter and blogs are pervading not only our private lives but our work lives too. While countless businesses use these media for marketing and research, only a handful have managed to effectively use social media in the workplace to harness, advocate and generate discussion around employee benefits with the employees themselves.

With 60% of adults in the UK accessing the internet every day or almost every day1, whether it’s at home, at work or on their mobile, it seems crazy not to use the medium to its full potential when it comes to communicating your employee benefits package to staff.

WHy BOTHER?

HOW TO GO ABOUT IT

Benefits communication is all about trying to reach the hard-to-reach and engage the unengaged. One of the great things about using Facebook or Twitter is that it aligns your discounts programme with your employees’ lifestyle outside of work. It creates an immediate connection between their employee benefits and their home life. Their employee discounts programme should fit into their existing lifestyle and habits, not the other way around. You want them to use the discounts on products and services to save them money on what they’re already buying.

Inchcape Retail UK has recently launched a Facebook page to communicate its discount scheme to employees. The HR team got the ball rolling by running an employee benefit survey which was completed by nearly half of the workforce, and returned a positive response to the suggestion of communicating through Facebook.

What’s more, providing convenient, easy access to the platform through a Facebook page or a link on Twitter cuts out the potential barrier of ‘I don’t know what the URL is’ or worse, if the link is only on your intranet then you are counting on your employees to remember what the URL is rather than providing a link wherever possible so they don’t need to remember the URL. We are, after all, increasingly becoming a one-click, on-demand society.

“Facebook offers a great opportunity to communicate some great benefits to our colleagues in a way that helps increase and maintain employee engagement,” says Inchcape’s HR Administrator, Rachel Begg.

“The offers and savings available through the scheme generate a good deal of excitement among our employees so it’s great to have a forum through which they can share their money-saving experiences and share tips and recommendations.”

Set up as a ‘private’ profile on the social networking site, employees receive regular updates on new retailers, competitions, most popular offers, weekly ‘top ten’ retailers and offers, and peer-to-peer discussions and recommendations for savings available through the Inchcape Employee Advantages Scheme, provided

by Asperity Employee Benefits.

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Office for National Statistics: www.statistics.gov.uk/cci/nugget.asp?id=8

To join the Facebook profile, employees must request friendship and then be accepted by Inchcape’s Colleague Support Services team, who verify that the requester is an Inchcape UK employee. The profile includes a helpful information section, which explains how the scheme works and how to register, along with clear details on how to contact the scheme’s Helpdesk and Inchcape’s Colleague Support Services team.

In the 3 months since launch the page had gained nearly 140 friends without any promotion at all but through word of mouth.

Feedback on the Facebook profile has been hugely positive and there has been a number of money-saving ‘good news’ stories posted by employees.

Taking a slightly different approach, IBM has developed an employee blog for a similar purpose. The IBM Rewards Community blog launched in July 09, hosting video interviews and written testimonials where IBM staff share their savings success stories and tips for their colleagues. IBM staff win a £50 prize for each of their stories that are published and this area is now vibrant and updated regularly. There are now dozens of stories on the blog where IBM employees tell each other about savings tips and ideas and the good news message that this creates has delivered measurable increases in site usage.

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As IBM’s environmental strategy restricts the use of printed communications, increasingly innovative techniques must be employed to reach an email-saturated audience.

October 09 saw the launch of the IBM Rewards Twitter group – the first employee benefits site in the UK to use a daily tweet on Twitter to publicise new updates on benefits. Twitter was already in use by technology projects in IBM but this development was the first time an HR project had used the tool. Getting IBM’s nontechnical support, sales and customer service staff to use the group supported IBM’s corporate goals of making new technologies core to the business, outside of the technical centres.

The Twitter group has been a huge success with thousands of employees using it for updates and 345 people becoming fully-fledged followers. The group has developed since launch to facilitate two-way dialogue between the IBM Rewards team and users, allowing discussions to be had with some of the most active IBM Rewards users. And the success of such an initiative is evident in the statistics this group logs in 58% more frequently than the average user and achieves employee savings of 2.5 times the average2.

What resources will you need?

You will need to dedicate some, not a lot, of your time and human resource to this kind of project. But your employee benefits provider is there to take the majority of the burden off your hands. They will have proven experience in helping organisations utilise the right methods for your workforce.

Alex Bailey is Communications Manager for Asperity Employee Benefits.

Comments? Send them to: alex.bailey@asperity.com.

Usage statistics provided via Asperity’s RewardManager™ system.

5.

MYTH-BUSTING METHODS FOR CHILDCARE VOUCHER ENGAGEMENT

By Daisy Hill

Resident childcare voucher engagement specialist for Asperity, Daisy Hill, looks at overcoming the challenges faced by employers to increase participation in their childcare voucher programmes.

“Am I being unreasonable to be really mad that you can’t use childcare vouchers down the pub?”

— (Mumsnet online forum)

A quick search on parenting hub Mumsnet reveals the confusion that often surrounds a childcare voucher scheme. Luckily the above blunder was swiftly counteracted with “find me an Ofsted-registered pub and I’ll be there like a shot!”, but not all myths are so easily debunked. Many parents are missing out on huge annual savings of up to £933, either because they perceive signing up and the salary sacrifice aspect to be too much hassle, or they believe other myths about who the scheme applies to, and what the vouchers are used for.

Combatting these falsehoods can be as simple as communicating the range of options available for spending the vouchers to the parents at your company. Seasonal campaigns such as promotion of childcare voucher (CCV) use at Summer camps and after-school clubs in September can help. However, it is often the case that regular users of CCVs for nurseries are completely unaware of these avenues and so drop off the scheme. If a voucher provider then targets their communication of the programme to those that have cancelled, employers will see significant re-application to the scheme (and a significant boost in their NI savings!)

Whilst CCV is often a tricky subject for employers to tackle, at the very least a provider should have a savings guidance calculator for employees and point them in the direction of HMRC. Ideally a CCV provider should also run a 7 day a week helpdesk, with experts available to guide parents through the options and usage of the programme.

Indeed, in organisations where pay is a sensitive issue, it is often better to cut right to the chase and target those who are eligible.

Concerns are often expressed by major retail organisations for example, that non-targeted marketing will confuse part-time employees and those on or near National Minimum Wage. However, a mistake is often made in the failure to promote the scheme at all, instead of getting the right communications to the right people - on higher earners’ payslips, for example.

In fact, effective gender-specific communication can also prove crucial in increasing the uptake of childcare vouchers amongst employees. We don’t need a landmark-scaling father in a Batman costume to remind us that we are firmly out of the dark ages in terms of the family patriarch taking responsibility for childcare.

A recent report by the Equality and Human Rights commission has confirmed that social ideals are undergoing comprehensive change, with a greater number of fathers than mothers believing it is a joint responsibility to care for the children1.

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However, a third more females than males take up childcare vouchers2. Therefore, marketing the benefit to fathers specifically is an important part of any successful CCV programme to increase awareness of the benefit amongst the male contingent.

Good communication often works by challenging the misconception that only one parent in a family can take up the voucher scheme, and that a parent who doesn’t live with the children can sign up too.

Once signed up, parents are not only passionate about their own savings but are very likely to recommend CCV to friends and colleagues. A few employers, who have already worked with their provider to encourage high take up of the scheme, have begun to harness the influence of self-appointed ‘childcare champions’ in the workplace. Companies are now introducing ‘Refer a Friend’ schemes via their provider as the next stage in a successful and profitable communication strategy.

It goes without saying that offering a childcare voucher scheme goes a long way in attracting and retaining the best people in a company. And certainly not many myths revolve around ‘Ofsted-registered pubs.’

However, de-bunking the common myths that can form a self-constructed barrier to employees, whilst actively promoting this benefit to those who really need it, is the key to a successful voucher programme and the mark of a good provider.

EHRC (2009b). Working Better: fathers, family and work contemporary perspectives.

Research summary 41. London: Equality and Human Rights Commission Vital-Statistics-How-employee-demographics-affect-benefit-design.pdf on www.employeebenefits.co.uk

7.

IS THE ELEPHANT IN THE ROOM GREEN OR WHITE?

By Megan Gough

Without doubt green issues have played second fiddle to the economic downturn.

None of us think this downturn is going to last forever. We pretty much all hope it will disappear as quickly as it seemed to arrive.

“By harnessing a collective ground swell from all your employees you can amplify actions that individuals can take.”

Well, the same cannot be said for the issues we are faced with today concerning the environment and our impact on it. Any expert will tell you that unless we take action now to reduce our environmental footprint, our generation is going to leave a bleak legacy for our children’s future. Enough said. We can all take simple, practical steps that will make a world of difference, for a better world.

A really good place to start is from the ground up. But how is it that 78% of organisations say that it’s important to encourage employees to find ways of improving the organisation’s impact on the environment, yet only 24% say they have used products or services in the area of green and ethical reward, benefits, motivation or communication* (and half of those are cycle to work schemes)?

Most companies will have their own Corporate Social Responsibility (CSR) agenda and it would be surprising if ‘green’ and ‘sustainability’ didn’t play a huge part in that agenda, because it really is the collective responsibility of all organisations to tread as lightly as we can on our planet, whilst at the same time continuing to generate our profits. What’s more, our employees expect this from us.

The answer is that there isn’t a great deal of help available to them. Companies need a credible and easy to implement programme, with a low impact on HR Departments’ time, whilst also respecting the limitations on available budget.

Amongst your tens, hundreds or thousands of employees there will be instinctive green champions doing their upmost within their own lives. Employers hold to some extent an authoritative position in many people’s lives, and as such should be setting examples and encouraging awareness and behavioural change.

And then there is the commercial advantage.

Not only can companies gain from saving on energy and resources, but many companies have already cottoned on to the connection between being a green company and being successful. Already there is evidence that the greener companies are winning the contracts and therefore attract the best people. Natural selection will prevail as it always does, so don’t be caught out.

It’s key to develop inspirational communications that encourage people to stop and think, and more importantly help people to see that there is a part for them to play, as most people tend to think their personal efforts are insignificant in the bigger picture.

“Turning off the tap while brushing your teeth can save over 5 gallons of water a day. If all staff at XYZ Co. did this we would save 2 million gallons each year!”

Then combine these drip feed communications with a structured green Reward & Recognition service and an interactive online portal and you have got a great programme that will have positive results.

In fact, a programme like this would take care of three out of the four criteria items looked at by The Sunday Times 60 Best Green Companies, which asserts that ‘green business is blooming’. When a heavyweight like The Sunday Times gets behind a concept, it becomes clear it can no longer be ignored.

Make sure that your business incorporates enough green to bloom in the modern corporate world.

Megan Gough is Head of Viridien, a new venture which enables employers to align their green agenda with their reward and benefits strategy.

Comments or questions? Contact Megan on 07595 272327.

“This programme takes care of three out of the four criteria items looked at by The Sunday Times 60 Best Green Companies” By harnessing a collective ground swell from all your employees you can amplify actions of individuals. Communicate these changes as ‘the company‘. For example:

* Green Rewards survey of HR Managers, Directors and Professionals in January 2011.

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CASE STUDY:

THE CHILDREN’S SOCIETY The Children’s Society, like most charities was facing a challenging period. The global economic crisis was having a knock on effect on the charity sector and The Children’s Society faced cutbacks and cost pressures. In this climate how could it continue to recognise and reward its employees?

QUICK FACTS

10.

Employees

1,000

Workforce profile

A mixture of retail, community and office based employees.

Highlights

Offering employees a valuable benefit during tough financial times

The Children’s Society works tirelessly to improve the lives of children, and each employee - whether they are retail, community or office based - plays an important role in making this happen. But for an organisation where so many of its employees work remotely and at a time when everyone was feeling the financial squeeze, creating a sense of affinity with the corporate identity was proving a challenge. The Children’s Society wanted to connect with its employees and boost morale but it needed to do this in a cost effective manor.

They looked at the options available and decided upon Asperity’s Reward Gateway - not only because it enabled the charity to offer its employees a valuable discount benefit, but also because of the flexibility Reward Gateway offered. The branding flexibility as well as the opportunity to include additional benefit information would all prove to be valuable features for The Children’s Society.

The Children’s Society was undertaking a rebranding exercise at its retail stores producing something modern and fresh.

Reward Gateway was given the same branding treatment and its launch helped to support internally the rebranding campaign.

Additional pages were also built into Reward Gateway showcasing additional benefit information.

This new and vibrant benefit hub made it very easy for employees to see just what benefits they enjoyed as a consequence of working for The Children’s Society and the Reward Gateway discounts themselves helped employees make their money go that little bit further.

The communication programme also helped to support the rebrand campaign.

Working closely with the branding team, all guidelines were adhered to and a schedule of communications was planned around calendar themes such as Back to School, Summer Holidays and Christmas.

Newsletters and posters were key tools when it came to reaching the offline workforce while the development of an intranet Forum, providing employees with the opportunity to share their saving tips and recommendations, proved equally valuable in reaching the online community.

And with extensive use of the Helpdesk, it was clear that the 7 day a week facility was an invaluable asset when it came to helping employees extract the most from the scheme.

It doesn’t stop here though. Together Asperity and The Children’s Society are taking the time to understand what the Management Information is revealing about usage and are using this analysis to help design the communication strategy going forward.

What’s next?

The aim is to identify those areas of the business where engagement still needs a boost and deploy the best communication tools available to make this happen.

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Asperity Employee Benefits Ltd 90 Westbourne Grove, London W2 5RT t +44 (0)20 7229 0349 f +44 (0)7092 010 022 e benefits@asperity.co.uk www.asperity.co.uk