Waitrose is the latest company to announce they are reducing employee benefits, and lowering rates of pay offered to new starters who work unsociable hours. This comes after B&Q, Morrisons, Caffe Nero and Eat also implemented cuts to the perks they offer to their staff. Even though Waitrose has explained that the changes have been in the pipeline for some time and are to bring the brand more in line with its competitors, critics argue that employers are making these cuts in order to compensate for the shortfall resulting from the National Living Wage, enforced on 1st April 2016. There was even a Commons debate on the issue this week, where Labour MP Joan Ryan said: “businesses should not be cutting staff pay via terms and conditions to offset the costs [of the National Living Wage]”.
Companies concerned about the implications of a higher wage bill resulting from the National Living Wage may believe that the only solutions is to reduce perks to employees but there is also the argument that this may be a short-sighted approach particularly as the Millennial generation of workers look at company perks to differentiate similar roles and workplaces to ascertain which would benefit their career further in the long term. The competition for desired skillsets is driving salaries up, but a competitive salary is no longer enough. Perks such as bonuses and benefit packages play a massive part in attracting the best talent and professional development opportunities, flexible working options and progressive career paths are now increasingly sought after.
Those companies hitting the headlines this week could risk being overlooked by the best talent if they are unable to match the benefits offered by their competitors. An attractive benefits package can help companies get ahead in the ‘war for talent’ and shouldn’t be disregarded in the face of making cuts for short-term gains.