Clarity on cost and value is key to employee benefits consulting

Finding shared experiences

Employee benefits research

As we experience our third lockdown of the pandemic, I’ve been thinking back on the research around employee benefits we carried out in the midst of the first lockdown last year.

Part of the reason for asking more than 300 companies how they and their employees were faring during the pandemic was also to find out what could be a concern shared, a common theme with which we could all identify.

And it soon became clear that there were a number of visible findings which fitted this category.

Flexible working

Unsurprisingly, companies ranked their employees’ most valuable benefit as the ability to work flexibly. I think we can take that as partly about working from home but also about being allowed to clock in the hours to suit your domestic responsibilities.

We know some are starting work earlier than usual, allowing them time for school pick-ups or exercise. There’s a realisation from many employers that it’s about getting the work done, not about the hours in which the work gets done (within reason).

No real surprise, then, that this should figure so prominently during these times but there was also a reminder of how the pandemic has sharpened perennial issues.

Risk is the reason

Financial education

Four out of ten employers did not support their staff when it came to financial education and guidance. The reasons they gave were instructive and not unfamiliar.

Sixty-one per cent were worried about it costing too much and 58 per cent feared falling foul of regulation.

Or, in other words, risk, whether financial or regulatory. Something we’ve advised on and guarded against for the last 30 years or more for many, many clients.

However, what is the risk to employees of not providing this support, particularly through these troubled times?

I know that many people’s incomes have been impacted because of Covid-19’s implications and, more so than ever, people may be stressed, anxious and focused on the short-term nature of their finances.

As a result, some could be tempted to free up cash by reducing their pension contributions or encashing policies that ordinarily they would have left invested.

Now, it’s not for me to make a judgment as to whether it’s right or wrong to make these decisions but these are moments likely to have longer-term implications. I believe it’s important to have all the facts to hand to enable people to make rational, informed choices. That’s where financial education and guidance comes in.

Value for money

Virus resetting value

My counter to any concerns about providing this support is as it always has been: working with the right adviser will cost money but, in return, the counsel offered will deliver value to both employer and employee beyond that of the bill, while identifying and avoiding any risk posed by regulation.

This is particularly relevant during the current unpleasantness. Anecdotally, the market tells us that return on investment is a keenly felt priority for 2020 and beyond as businesses grapple with a future that, with the creation of a vaccine, seems a little clearer.

Companies, big and small, want to be sure that their spending on consultancy services such as pensions, health and protection benefits and employee assistance stacks up. It’s something our survey backs up.

Meanwhile, eighty six per cent questioned said the pandemic had increased the need for better understanding of financial wellbeing in the workplace; they also said their staff ranked health, job security and finances as their top three priorities.

This year has been unprecedented, yet the world keeps turning. Many businesses still strive to communicate, stay in contact, and continue transacting. To do so, they are doing what they can to support their employees in a cost-effective and efficient fashion, and expect their advisers to recognise and adopt the same principles.