This document provides an overview of various compensation and benefits topics, including: - Flexible benefits and how to successfully implement a flexible benefits scheme - Common flexible benefit options such as childcare vouchers, corporate incentives, and cycle to work schemes - Topics such as employee share schemes, private medical insurance, minimum wage increases, and "perfect perks" - Tips for negotiating with benefits and incentives suppliers, and rescuing failing motivation schemes - Guidance on pensions, salary reviews, and using salary surveys effectively The document aims to give human resources professionals guidance on structuring, implementing, and managing a variety of compensation and benefits programs.

1. Compensation & Benefits by Fluid June 2010

2. Page 2 Contents 3-4 Introduction to Fluid 5-7 Evolution in strategic reward management 8-16 Flexible benefits 17-18 Childcare vouchers 19-20 Corporate incentives 21-22 Cycle to Work scheme 23-24 Employee assistance programmes (EAPs) 25-26 Employee share schemes 27-28 Private medical insurance 29-30 Dealing with minimum wage increases 31-32 Perfect perks 33-35 Benefits and allowances 36-38 Negotiating with a motivation & incentives supplier 39-41 Rescuing motivation schemes that are failing 42-43 Exercise 44-48 Pensions 49-51 Salary reviews and surveys 52-53 Conclusion and questions

3. Page 3 Introduction

5. Selection- Attraction - Remuneration & Reward - Outplacement - Training & HR consultancy

6. Page 5 Evolution in strategic reward management

8. FROM isolated initiatives TO integrated and balanced reward management

9. FROM focus on cash TO focus on total reward and engagement

10. FROM mechanistic and inflexible systems TO organic, simpler, variable process

12. FROM design best practice TO process: best fit

13. FROM HR control TO line/employee ownership

14. FROM top-down telling TO communicate and involve

15. FROM ‘big bang’ change TO evolutionary change

16. FROM guess work/faith TO evaluation of initiatives

19. Existing benefits-policy decisions about what to include and what to exclude

20. Breadth and design of scheme-years one and two and beyond

21. Data-the quality, accessibility and its updating

22. Integration-HR and payroll

23. Administration-should it be internal or external?

24. Discrimination issues-for instance age and sex

25. Harmonisation or savings-never conceal what the scheme might be changing

26. Technology-the fit, integration and capacityFlexible benefits 1 of 8

28. Pension

29. Private medical insurance

30. Childcare vouchers

31. Dental insurance

32. Holiday trading

33. Life assurance

34. Share incentive plan

35. Give-as-you-earn charitable donations

36. Health screening

37. Critical illness coverFlexible benefits 2 of 8

39. Share save plan/SAYE plan

40. Retail vouchers

41. Discounted services

42. Cycle to Work schemes

43. Optical care/vouchers

44. Gym membership

45. Healthcare cash plan

46. Company car

47. Personal accident insurance

48. Travel insuranceFlexible benefits 3 of 8

50. Season ticket for travel

51. Mobile phone

52. Cash alternative to company car

53. Personal computer

54. Income protection

55. Financial planning

56. Cash alternative to other benefits

57. Home insurance

58. Concierge benefits

59. Home phone packageFlexible benefits 4 of 8

61. Build a strong business case to obtain senior buy-in

62. Select an experienced broker to negotiate favourable terms

63. Choose a technology provider with a proven record

64. Don’t be over-ambitious initially-much better to enjoy the successful launch of a core flex package that you can build on in future years than being associated with a failed project

65. Spend as long as it takes cleansing your benefits dataFlexible benefits 5 of 8

67. Appoint a project team with at least one senior champion

68. Choose a system with built-in rules that prevent uninsured liabilities or additional administration burden

69. Communicate clearly with employees at all stages, including focus groups initially and feedback surveys after launch

70. Remember that flex is flexible-you can add benefits in future years to maintain interest and change any that don’t workFlexible benefits 6 of 8

72. Pick people to do the planning

73. Assess feasibility

74. Get the numbers to add up

75. Build the scheme

76. Look to the law

77. Concentrate on clear communication

78. Integrate-whether system in in-house or outsourcedFlexible benefits 7 of 8

80. Consider the specific needs of the organisation

81. Communicate ease of set up and use to employees

82. Remind the workforce about the new schemeFlexible benefits 8 of 8

83. Page 17 Childcare vouchers

85. Paper and e-vouchers

86. Online transactions available-Mac and PC compatible?

87. Can vouchers be used for ‘registered’ or ‘approved’ care?

88. Dedicated helpline

89. Services included

90. Standalone or part of flexible benefits online

91. Set-up time

94. Product range

95. Cost to employer

96. Delivery time

97. How scheme is administered

98. Support given

99. Particular selling pointsCorporate incentives

100. Page 21 Cycle to Work scheme

102. Brand of bike

103. Type of bike

104. Safety items available

105. Number of stores where available

106. How is scheme administered

107. Home delivery/delivery time

108. Order online/mail order

109. Marketing support

110. Software linked to client’s software

111. Helpline

112. Set-up time

113. Cost to clientCycle to Work scheme

114. Page 23 Employee assistance progammes

116. Cost per head

117. Set up time

118. Essentials of the scheme

119. Manager training

120. Support given

121. Particular selling pointsEmployee assistance programmes

122. Page 25 Employee share schemes

124. Type of scheme

125. Discretionary share schemes?

126. Cost to employer

127. Set up time

128. How scheme is administered

129. Support given

132. Inpatient cover

133. Outpatient cover

134. Extras

135. Dependant cover

136. Tailored to fit individual groups

137. Cost containment

138. Telephone support

139. Online support

140. Internal marketing support

141. Set-up time

142. Cost’Private medical insurance

143. Page 29 Dealing with minimum wage increases

145. Revisit your pay structure

146. Consider the costs of staff turnover and training

147. Involve the bean counters

148. Know the law

149. Use alternatives to retain people

150. Consult, test and review

151. Talk to your employees

152. Invest in management

155. Pampering-Alexander Associates

156. Fun and friendly-NM Rothschild

157. Instant reward-Volvo

158. Prize variety-Carphone Warehouse

161. Long service awards

162. First aid payments

163. Call-out payments

164. Money-purchase pension schemes

165. Final-salary pension scheme

166. Stakeholder pension scheme

167. Standby allowances

168. Discounts on own organisation’s products or servicesBenefits and allowances 1 of 2

170. Mileage allowance

171. Car allowance

172. Subsistence allowance

173. Free car parking

174. Company car scheme

175. Interest-free season ticket loan

176. Subsidised staff canteen

177. Car leasing scheme

178. Subsidised car parking

179. Interest-free car park loan

180. Interest-free congestion charge loanBenefits and allowances 2 of 2

181. Page 36 Negotiating with a motivation & incentives supplier

183. What resources have you got to help me handle my account?

184. How much of the solution you’re proposing is handled in-house and how much is outsourced?

185. What service agreements can you out in place to ensure delivery?

187. How do you charge for your products and services?

188. What are your commission rates and what is your mark-up on reward media that is brought in-for example vouchers, merchandise, travel and so on?

189. How do you propose we measure the impact of your recommendations?

192. STEP TWO-decide whether the rewards are target based and if so take care to set achievable parameters

194. The scheme design or reward offered is unsuitable for employees’ age, sex or desires

195. The reward has a gimmicky quality that could be perceived to insult the employees’ professionalism

196. The reward conflicts with the employees’ culture or religion

197. The reward is offered for a target that is beyond the employees’ reach

198. The gift is selected on the assumption that money is the best motivator for everyone

199. The incentive is something that the employee already has

200. The reward is not delivered in the way that it was originally promisedRescuing motivation schemes that are failing 2 of 2

201. Page 42 Exercise

202. Page 43 Exercise

203. Page 44 Pensions

205. DB

206. DC

207. CSIPP

208. Deficit

209. FRS17

210. GPP

211. Hybrid scheme

212. Rate of accrual

213. TrusteesPensions 1 of 4

215. Beware giving financial advice

216. Take the initiative

217. Use your providers for additional support

218. Use a variety of media

220. Engage your people

221. Use plain English

222. Communicate regularly

223. Measure their understanding

225. Inform employees about changes and why they are happening

226. Create a handbook

227. Approach the matter sensitively

230. Work out your budget

231. Review reward principles

232. Analyse market pay data

233. Gain budget approval

234. Communicate the timetable

235. Support line managers

236. Fine-tune the process

237. Explain decisions to employees

239. Ask who produced the survey

240. Check out the methods of data collection

241. Make sure the sample size is large enough

242. Pay attention to all reward package elements

243. Understand the key statistics

244. Get the right match

245. Decide your market position

247. Page 53 Conclusion Summary Questions