I predict a revolution (no, not a riot). For too long the benefits industry has been elitist. Now, it’s finally time to open the door for SME’s.
For as long as I can remember it has been the larger organisations; the multi-nationals and huge corporates who have been able to offer the most attractive employment packages. More recently it has been some of the digital giants who have been able to attract the top talent with their benefits, environment and even salary. Think the likes of Netflix with a year’s paid maternity or paternity; Google with their free food and Airbnb who give their employees $2,000 to travel every year. So they have the pick of the best talent and casting a shadow over SME’s who may be doing as equally an amazing job through their organisation.
Historically, SME’s and micro businesses were faced with a dilemma. Without the resources or available capital of corporate of multi-national companies, should they offer an attractive benefits package (if affordable at all) or should they focus on maximising their employees’ salaries?
In today’s world benefits are beginning to play as much of a part an individual’s decision to work for an organisation as salary. According to Glassdoor research, 3 in 5 people report that benefits and perks are amongst their top considerations before accepting a job. When it comes to talent retention, 4 in 5 people say that they would prefer new perks and benefits over a pay rise. So to attract the talent to an organisation, SME’s need to be able to compete with their larger counterparts.
When benefits technology first came about it typically came attached with huge implementation fees, massive license fees and compulsory administration fees. Compounded with the need for broking and consultancy services, employee benefits then became and elite expenditure, available to large organisations with high capital resources, and way too expensive for SME’s and micro businesses.
However, tied in with the introduction of Auto-Enrolment every employer, be it your 2 man company or the likes of Google, now offer a basic benefits package; a salary and pension. This is the most simple benefits package, but a benefits package all the same.
I therefore ask the question, what can we do to break down the barriers to enable more employee benefits being made available to smaller employers?
These are benefits which employers can offer at no cost to themselves, but the employee can purchase through payroll, and receive a discount, in many cases against the price on the street. They can include bike to work schemes, dining cards, such as taste cards, wine clubs, gadget insurance and much more.
These can have a huge impact on employee morale and motivation, and as for costs spreading the risk over your business can mean that premiums are much lower than that of an individual premium you may pay yourself. Will Lovegrove, CEO of pensionsync highlights how small organisations can cover their entire company for less than an individual plan in his article ‘Group Life Insurance: “I didn’t realise it was so cheap”’.
There is also a wide variety of other perks SME’s can offer their people. Depending on the needs and wants of the workforce they could also include volunteer time or an extra day off for birthdays, an employee performance bonus plan or just fruit in the office. All of these can make a huge difference on your prospective and existing employee’s perception of you.
Today, new staff benefits technology doesn’t have the sky high implementation costs and license fees we’ve become used to. And there definitely isn’t the need for administration costs anymore. Removing the barriers to technology for many organisations.
Large or small organisations need to share their benefits clearly and effectively with their workforces. But, what if this technology had a shopfront which could help you select the most effective (both cost and impact) benefits for your organisation? Whether they be risk insurance, voluntary benefits or more? All of a sudden, the smaller employer now has everything they need to attract and retain a similar calibre of talent to that of larger organisations.
Personally over my 24 year working career I’ve worked for large multi-national organisations and for micro companies with just 10 employees. Personally I’ve always preferred working for the smaller companies, but the benefits I received from the larger employers always surpassed those from the smaller business I worked for, but that’s no longer the case. Now with all of the options above and the reduced costs, we’re seeing the gates open to SME’s and those elitist days drawing to a close.
This is a truly exciting time and I can’t wait to see how this begins to shape and change the talent market moving forward.
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