Did you know that on average, employers spend around 20% of an employee’s salary on benefits? That’s a lot of money so surely it’s important to understand if it’s valued?
Do you measure the return on investment on your benefits scheme? Or track employee engagement with benefits?
Whether you do or don’t, we have some tips on how you can get the most from your engagement data.
Why is it important to measure benefits engagement?
After salary, benefits are the largest employee expenditure. Tracking employees’ engagement with benefits is one of the ways to help you measure the return on investment (ROI) of your benefits scheme. If you know which benefits have higher or lower engagement, you can be better informed to make changes and improvements.
Evaluating employees’ engagement with their organisation isn’t ground-breaking. In fact, it is a widely used practise. Yet, measuring and analysing employees’ engagement with benefits is still a new concept for many.
Read on to find out what you should consider when analysing benefits engagement.
Understand what’s important
Look at benefits that employees select the most, as this can tell a story of what is important to your people. For example, many employers have noticed – the popularity of Cycle to Work has skyrocketed. This is great for many employees. Yet, some are struggling to buy the bike they want, as their bike scheme only allows vouchers up to £1,000.
When you see high or low engagement levels with benefits, make sure to check if the benefit is still fit for purpose. And if the benefits design allows employees to maximise the value of the benefit.
Look deeper
We know everyone is different. Your employees will value and prioritise different things in life. If you divide them into demographic groups, you can get an idea of which benefits are the most popular by group. This allows you to see trends, for example younger employees may engage well with lifestyle benefits over retirement benefits. Do you need to communicate retirement options in a different way to these employees? Employees with children or other caring responsibilities may buy more annual leave. Could this be a reason to re-evaluate your family support policies?
You can be more strategic with your benefits scheme if you understand trends. This allows you to make informed choices when tweaking or changing your benefits.
Benchmark
Let’s face it – some benefits will never be as popular as others. Benefit cost, relevance, and value all play a part in employees’ decision to sign up or not.
It’s hard to know if your engagement levels are good, just by looking at benefits take up. For this reason, make sure you compare your engagement figures to market levels. Understanding the market gives you better insight into your own trends.
Continuous measurement
Make sure that measuring your employees’ benefits engagement is not a onetime event. Instead, track and compare employees’ benefits engagement levels at equal intervals. This can tell a story and provide insight on organisational trends.
Have you noticed that benefits engagement this year has decreased? Or some benefits have become very popular? Analyse trends and you will spot areas of change. Once you do, make sure you evaluate your benefits scheme and adjust the benefit offering accordingly.
Pay attention to savings
Many employers know about the tax efficiencies that some benefits can bring. Yet often those benefits don’t receive enough attention.
We are here to remind you – communicate about your scheme with these benefits in mind. Focus on promoting tax efficient benefits and encourage employees to sign up.
In summary, every organisation has unique benefits strategy and priorities. Despite this, most organisations want their investment (compensation, benefits) to bring value.
Offering relevant benefits and measuring employees’ benefits engagement can help. Thus, don’t forget to track it to increase your contribution to your people and business!
Written by Mercer Marsh Benefits.
To find out how you can create a truly engaging strategy that really speaks to your employees hear more from us in person at Bond Williams HR & Leadership event at Bournemouth AFC on 24th January where you can hear Daniel Wyatt deliver an insightful session on how to create a benefit strategy that truly speaks to your employees together with Connor Jones, Senior Workplace Education Consultant at Mercer Marsh Benefits deliver a session on how you can support your colleagues with the ‘Rising Cost of Living’ crisis. Click here to book your place now, places are limited.
