2. 3
Access the eBook
Benefits: The Forgotten Strategy
Introduction
1. The Compliance Challenge
• Untangling the web of compliance
• Staying on the right side of the law
2. Meeting New Expectations: Managers and Employees
• Benefits for an age-diverse workforce
• Avoid administrative breakdowns and errors
• Providing openness and transparency
3. The Solution to Increase ROI
• Increase ROI by listening and communicating with employees
• Introducing a personalised and flexible rewards policy
• Employee engagement: Empowerment through self-service
Conclusion: Realise the Benefits
C-Suite Perspectives
Contents
3. 54
Benefits: The Forgotten Strategy
Benefits are a vital strategic tool that
employers cannot afford to ignore.
Organisations face many challenges in
this area. The Top Employers Institute
found that the “key to this is the need
to improve the effectiveness of their
approach to Compensation & Benefits
without major budget increases, whilst
ensuring that it attracts new talent and
keeps the existing employees happy
and motivated.”1
A “one size fits all” benefit model is no longer an
option. The majority of UK employees (57%) say that
improving their benefits package could motivate
them to remain with their employer.2
They want
flexible, self-service options, from employers who
understand their needs. And if they don’t get them,
they will vote with their feet.
Yet despite this new reality, most benefits strategies
are not fit for purpose. Chances are, your business has
the same problem. As companies continue to look
for new ways to increase the impact that total reward
spend has on their business results, it is getting harder
to provide meaningful benefits in a cost reduction
environment.3
Providing meaningful benefits
and cost control
57% of employees
would stay with their
employer if their benefits
improved2
As companies continue to look
for new ways to increase the
impact that total reward spend
has on their business results,
it is getting harder to provide
meaningful benefits in a cost
reduction environment.
1. Top Employers Institute Compensation & Benefits Research Report 2015
2. MetLife (2015), Employee Benefits Trends Survey
3. Deloitte, 2014 Global Top Five Total Rewards Priorities Survey
Benefits: The Forgotten Strategy
It is a challenge for multi-national
organisations to keep track of
everything.
From increased retirement age to family-friendly
perks, commission, increased workplace flexibility,
remote working, child care payments, tax credits…
the list goes on – managing benefits is an increasingly
complex task, and things are made more complex
whenyouconsiderthenumberofcountriesthatGlobal
Benefits professionals are responsible for. In Europe,
there are four people of working age (20-64 years) for
every pensioner. By 2040, this figure is expected to
drop to just two, with significant consequences for
compensation and pension schemes.4
Often, employers do not invest in effective tools to
communicate benefits to their employees. Not having
the correct information can lead to dissatisfaction
when employees discover they’ve signed up for a plan
that doesn’t meet their needs. It is up to employers to
continually educate and inspire employees to make
the most of their benefit plans through consistent
messaging and support.5
In EMEA, more time is spent on implementing
benefits packages than they do on communicating
them: no surprise then that only 9% of employees
claim that they fully understand the reward policy of
their company.6
This has to change, and fast, for the
sake of your company’s competitiveness.
Only 9% of employees
fully understand the
reward policy of their
company6
Do your employees understand
their benefits?
4. The RandstadSourceright 2015 Talent Trends Report
5. HR Benefit Education Is the Key to Employee Comprehension, ADP Spark 2016
6. AON Hewitt (2014), EMEA Benefits Communication Survey
4. 76
1. The Compliance Challenge
HR teams are swamped by an ever-
shifting regulatory landscape. They
are buried under risk management
demands and scrambling for local
legislative support.
With each new business expansion, the reward and
benefits tasks become more complex. Streamlining
and integrating widely disparate systems seems
impossible, while data-privacy standards to protect
sensitive information are sorely needed.
Whether it’s the EU Posted Workers Enforcement
Directive, pensions auto-enrolment in the UK, new
tax rates for company cars, or Sarbannes-Oxley
compliance with US partners, there is a steady flow of
in-coming laws that benefits can fall foul of.
1. The Compliance Challenge
With each new business
expansion, the reward and
benefits tasks become
more complex
Untangling the web of compliance
7. Maintaining Compliance and Mitigating Future Risk, ADP 2014
33% of midsized firms
were fined or penalised
in 20127
5. 98
“Employers need to stay compliant
which is hard to do without expert help
and support.”
Manuela Montagnana, ADP VP Human Resources EMEA
1. The Compliance Challenge
According to Manuela Montagnana,
ADP VP Human Resources EMEA,
“The continuing rollout of legislative
changes in payroll and benefits – for
example DSN or BSI in France, and
auto-enrolment/shared parental leave
and RIT in the UK – brings not just a
greater focus on compliance, but also
fines that can apply for noncompliance.
Employers need to stay compliant
which is hard to do without expert help
and support.”
Offering the right benefits can “attract and retain the
best talent in a tough marketplace,” advises Manuela
Montagnana, “but there are legal stipulations on what
you can and cannot do. Not having the right benefits
offerings can be costly for you and your business.”
Staying on the right side of the law
“Offering the right
benefits can attract
and retain the best
talent in a tough
marketplace.”
Manuela Montagnana
ADP VP Human Resources EMEA
6. 1110
2. Meeting New Expectations:
Managers and Employees
2. Managers and Employees
To make things even more complicated,
employees increasingly want to take
control of their benefits. They want a
menu of benefits options tailored to
meet their needs and life stages, and
they want to be able to access them on
the mobile and tablet, wherever they
are, whenever they need to.
One of the most daunting challenges employers face
is how to manage an age-diverse workforce. As the
numberofGenerationZ(born1995orlater)employees
entering the workforce grows and Millennials (born
1981-1995) move into leadership roles, employers
must offer benefits that suit differing needs.8
According to Gallup, Baby Boomers (born 1946-1964)
have the lowest level of engagement and the highest
level of active disengagement of all the generations
in the US workforce with nearly one in four actively
disengaged: “Millennials are generally more upbeat
about all aspects of engagement than are Baby
Boomers or members of Generation X (born 1965-
1980), but Millennials are specifically more positive
about growth and development opportunities”,
finds Gallup, and they “are particularly prone to job
hopping”.9
1 in 4 of the Baby
Boomers are actively
disengaged9
Engagement levels by
generation:
Benefits for an age-diverse
workforce
8. The RandstadSourceright 2015 Talent Trends Report
9. Gallup (2013), Generation Gaps in Engagement
7. 1312
2. Managers and Employees
Every successful company needs to
create an effective benefit policy with
economy of scale wherever possible;
yet employees and managers are
demanding a more personalised
benefits structure that meets their
needs as an individual. With Millennials
and talent war and mobility, a good
benefits policy can make the difference.
The juggling act employers have to perform,
therefore, is to offer benefits that are both flexible and
harmonised. Simply providing a long list of options to
try and please everybody means that you’re setting
yourself up for an administrative nightmare, especially
if you don’t have the software and logistical support to
back it up. Many employers are risking administrative
breakdowns with a mix of manual processes and in-
house software, some even using excel spreadsheets.
Instead, you need to automate and integrate your
benefits administration within a safe and centralised
digital environment.
Take commission-based pay. It is one of the easiest
benefits to understand – if you meet your targets,
you are rewarded accordingly. However, a survey
of sales directors found that companies are losing
large sums of money due to inadequate in-house
processes. Almost a quarter of companies surveyed
said they regularly saw errors of over 10% of the total
commission paid, 20% said they didn’t know what
errors occurred when paying out sales commissions,
and over 52% admitted they regularly had to deal with
queries and complaints from the sales force.10
In such
cases, a benefit that is supposed to incentivise good
performance ends up doing the exact opposite.
With Millennials and
talent war and mobility,
a good benefits policy
can make the difference
Avoid administrative breakdowns
and errors
10. Vanson Bourne OpenSymmetry (2014), Commission Survey
2. Managers and Employees
A harmonised benefits process that
looks the same, works the same, and
can be easily accessed across your
whole business by employees and
managers, has become an absolute
necessity.
A single software solution is needed that can
streamline employee eligibility, benefit calculation,
communication, and workflow management, within a
safe and centralised digital environment.
According to Chris Bruce of Thomsons Online
Benefits, “European employees are continuing to
push for more openness and transparency when it
comes to HR administration. They are demanding
increased access to benefits and rewards information,
which will place benefits management software at the
forefront of HR discussions. Engaging employees in
all parts of the world can be an overwhelming task
for HR teams, especially when faced with varying laws
and regulations, not to mention cultural differences.
Employers are also looking to SaaS-based solutions
to provide employees with a user-friendly HR portal
where they can easily manage their benefits packages
online. In response to the demand for mobility,
organisations will also look to implement solutions
that are optimised for tablet and/or smartphone use.
Europe will also continue to see a shift in companies
running decentralised HR processes and moving to
centralised HR processes with automated benefits
administration.”11
Using the cloud to centralise benefits and drive
employee engagement is now a business priority. A
recent Talent Trends Survey found that HR leaders
want to share information better through online
communities and social networks, with 50% saying
they plan to invest resources in the next 12-24
months.12
If you’re not planning to invest, then you
need to do so and fast, before your competitors do.
Providing openness and
transparency
50% of HR Leaders
will use more online
communities and social
networks to communicate
their benefits policy12
11. SHRM, Global HR Tech Trends for 2015
12. The RandstadSourceright 2015 Talent Trends Report
8. 1514
3. The Solution
to Increase ROI
3. The Solution
Increase ROI by listening and
communicating with employees
Employers that communicate benefits
effectively and take employee wishes
into account when determining which
benefits to offer, see higher value in
return. They can actually transfer HR
costs to employees through the use
of flexible benefits, voluntary benefits
and salary sacrifice, and at the same
time boost engagement by meeting
individual needs.
Research by MetLife backs this up. The more
employees value their benefits, the more engaged
they are in their work: “We also saw similar results
when we asked questions about an employee’s level
of commitment to their employer – the more the
employees valued their benefits, the more committed
they were to the employer. If an employer increases
an employee’s perceived value of benefits by 1 point
on the 5 point agreement scale, it increases the
employer’s sense of engagement to the employee by
12%.”13
The more the employees
valued their benefits, the
more committed they were
to the employer
By increasing the
perceived value of
employee benefits by
1 point on the 5 point
agreement scale, the
employee’s engagement
improves by 12%13
13. MetLife (2015), Employee Benefits Trends Survey
9. 1716
The way to offer benefits that appeal
to all members of the workforce is
through flexible benefits packages.
If you offer a broad range of choices
that can be mixed-and-matched, and
changed at different life stages, then
there is truly something for everyone.
Research by Employee Benefits Magazine into flexible
benefits finds that 54% of HR respondents believe
that flexible benefits improve the image of their
organisation, and around the same number suggest
that their benefits plan has improved recruitment and
retention of talent.14
The Reward & Employee Benefits Association
(REBA) also reports a growing trend for increasing
personalisation in reward and benefits packages
offered by the top employers.15
Benefits are reflecting
big changes in working practices towards individual
responsibility, which is expected to translate in a huge
rise in home technology (laptops, tablets) offered
through the workplace.
According to the REBA survey, reward and benefits
managers project a 42% increase in home technology
offerings appearing in employee benefits packages in
2016. The provision of financial education and advice
is also rising, with a 28.6% rise in employers planning
to introduce it in 2016 compared to 2015.16
54% of HR respondents
believe flexible benefits
improve the image of
their organisation14
Introducing a personalised and
flexible rewards policy
3. The Solution
14. Towers Watson (2014), Flexible Benefits Research
15. REBA/JLT (2016), Employee Benefits Shifts Research 2016
16. The HR Director, Reward and benefits more personalised in 2016
Empowering employees to manage
their own benefits solutions leads to
increased employee engagement and
workplace performance.
Kevin Close, a Senior Vice President Global
Compensation and Benefits at EMC, the global
business and service provider, has first-hand
experience of introducing employee-friendly benefits
software. “The user experience surpassed employees’
expectations,” says Close. “They said it allowed them
to complete the enrolment process efficiently, in one
10-minute visit. Our employees also liked the new
contemporary, consumer-grade look and feel of the
environment.”
A centralised global benefits solution supported by
deep local expertise can free employers with the
time and insight to focus attention where it’s needed
most. Manuela Montagnana, recommends that
you “streamline your employee eligibility, benefits
calculation, employee communication, and workflow
management into one tool, supported by experts.
Employees in EMEA are demanding increased
access to benefits and rewards information – this puts
benefits management software at the centre of any
HR strategy.”
Another added benefit is that this also frees up HR
teams from the burden of complex administration.
When employees take control of their benefits they
are actually doing the boring admin work for you,
and at the same time feeling empowered to directly
engage with their benefits in their own time, using
the same technology that they have at home. While
offering choice and control send the message to
employees that the company listens to them and
recognises their needs.
Empowering employees
to manage their own
benefits solutions leads
to increased employee
engagement and
workplace performance
Employee engagement:
Empowerment through self-service
3. The Solution
10. 1918
Conclusion:
Realise the Benefits
Conclusion: Realise the Benefits
Benefits can be a hugely beneficial
strategic tool. It can unlock employee
engagement and at the same time
relieve your HR team from the day-to-
day management of tedious benefits
admin processes.
However, employers attempting in-house solutions
typically fall foul of employment law regulation and
the IT nightmare of keeping on top of it all.
As Debi O’Donovan, partner at REBA, says, it is
a challenge that all organisations need to tackle.
“Ensuring engagement with pay and benefits is
something many have failed to do,” she says. “For
some it’s the challenge of outside influences, for
others simply poor internal communications. But it’s
a challenge that must be overcome. By ensuring they
place it top of their agendas… reward and benefits
professionals have a better chance of succeeding.”17
Turn your employee benefits into
a business asset
The path to success is a relatively easy one to take.
Outsourcing with an expert partner allows your
business to bundle everything into a centralised
digital environment that’s safe and secure, giving you
access to global and local 24/7 support. Benefits can
transform from an HR and admin headache, into a
major recruitment, engagement and employer brand
strategy. Cloud-based consolidation is the industry
standard for HR administration now. It offers consistent
user interfaces, well-protected data, reliable auditing
and reporting – all delivered through a single solution
and a point of contact. It’s time to turn your employee
benefits into a business benefit.
Global benefits solutions
paired with deep local
support delivers:
Economies of scale
Global consistency
Better employee
experience
Consistent localised
schemes across all
countries
17. REBA/JLT (2016), Employee Benefits Shifts Research 2016
18. Gallup (2013), ‘How Employee Engagement Drives Growth’
Companies with engaged
workforces can have up
to 147% higher earnings
than their competitors18
11. CEOs
Every CEO needs to ensure an effective benefits policy
is executed - one that incentivises employees to live by
the values, and carry out the business strategy. However,
employees are demanding ever more personalised
benefits that meet their needs as individuals – or else
companies risk key talent leaving. With Millennials, talent
war and mobility, a good benefits policy – which is not
necessarily more expensive – can make the difference
between staying ahead of the competition, or being
overtaken by them.
CFOs
A good Chief Financial Officer knows the burdens
with administrative nightmares from a mix of manual
processes, some often still using excel spreadsheets.
They also value outsourcing the admin and support
to an expert, a global partner able to make sure that
the company is always compliant with the latest local
regulations. The risk of not to be may have significant
legal and financial consequences that the informed
CFO is happy to avoid. A truly accessible online
benefits system, instantly updated and supported
by the outsourced partner, will open up a range of
tax-efficient benefits, such as pension contributions,
childcare vouchers and additional annual leave, all while
promoting employee engagement and productivity.
C-Suite Perspectives
CHROs
HR is in a unique position to continually educate and
inspire employees to make the most of their benefits
plans through consistent messaging and support. Yet
HR teams are swamped by an ever-shifting regulatory
landscape and the demands of an age-diverse workforce,
which they try to keep up with using desperate ageing
technology that is not flexible. Not having the correct
rewards information or ease of access can lead to
dissatisfaction. However, employee self-service,
accessible on mobile devices, provided by global
experts, can turn benefits into a powerful engagement
driver.
CIOs
CIOs are burdened with information systems nightmares
from a mix of manual processes and inconsistent software
programs that do not speak together. So, CIOs of
leading companies are now automating and integrating
benefits administration within a safe and centralised
digital environment allowing employees to access their
benefits online wherever they want. Using the Cloud to
centralise benefits and drive employee engagement is
now a business priority.
Employee benefits
policies affect everyone
but what does it mean
for the CEO, CFO, CHRO
and CIO?
