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Nearly all employers are planning to maintain or increase their spend on employee benefits over the next two years, according to new research which shows a sixth are planning to invest in a formal work-life balance policy in the next 12 months.
The ‘Reward management’ report, from the Chartered Institute for Personnel and Development and actuaries LCP, is based on a survey of 568 HR practitioners about their organisation’s benefits provision, most of which are not legally required. They include social events, Christmas bonuses and company cars.
The report finds eight in 10 employers intend to spend the same amount on employee benefits over the next two years as they currently do, while 16% plan to increase their investment.
All employers were asked which benefits they intend to spend more on in the next two years, even if their overall funding remains steady or decreases. Respondents said they are most likely to increase investment in the following areas:
The research also finds that when there are a higher number of women in management positions an organisation is more likely to already have a formal work-life balance policy – including flexible working and shared parental leave – in place.
Charles Cotton, senior reward and performance adviser at the CIPD, said: “Despite the recent economic and political uncertainty, employers are committed to investing in their employees and their future. It’s encouraging to see the benefits that have been earmarked for further spend in the near future relate to people development and well-being. Spending in these areas can help to improve employee, and ultimately, corporate performance.”
But the CIPD and LCP’s report warns that any extra investment in benefits risks being undermined by the lack of analysis employers carry out. The majority of respondents said they don’t currently conduct a review of their benefit spend, so could be missing the opportunity to establish how effective their benefits are. This is despite two-thirds of respondents saying their main purpose was to attract, recruit and retain staff to support current business needs.
The report also reveals that 16% of employers do not always communicate what benefits are on offer and one in five say their benefits are not easily accessible.
The CIPD is calling for better analysis of benefits so that employers can be confident they will contribute to the success of individuals and the business as a whole. It is also encouraging HR teams to be more proactive when promoting benefits and to adopt a multi-channel approach. This includes using tech solutions to allow employees to explore the benefits available to them in their own time, and for managers to have one-to-one discussions with their direct reports.
The survey found that currently the 10 most popular benefits offered to employees across all sectors (private, public and voluntary/not-for-profit) are: