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TRUST IS THE KEYBuild confi dence into staff and business relationships

EBC_0813 1 18/07/2013 16:34

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EB_0813 2EB_0813 2 18/07/2013 15:1818/07/2013 15:18

CONTENTS

www.employeebenefi ts.co.uk I August 2013 I 3

@ www.employeebenefi ts.co.uk

LEADERIN THIS ISSUE

Social networks have a major impact on trustIn late 2011, there was a media fl ap about how London Underground (LU) planned to announce delays on the tube. In the eyes of many commuters, the number of minutes that had to pass before a ‘minor’ or

a ‘severe’ delay was declared was too high. Accusations were thrown around that LU was trying to do something underhand to improve its delays record.

What this showed up was how quick people are to question the intentions of others. This is just as true in the workplace, especially after the hard times many employees, their managers and executives have experienced in recent years.

Trust is a fragile thing. It takes a lot of work to achieve, but can be damaged in an instant.Our cover article, Position of trust (see page 20) delves into the issue of trust in today’s

workplace, as well as the trust relationship between benefi ts managers and their suppliers.As a society, we often put our trust in what our peers say rather than what we are told by the

experts, such as the government, marketers and business leaders.Online peer reviews of products, sellers, hotels and restaurants

carry increasing weight in the eyes of consumers. This concept of peer-to-peer review is said to be coming into the workplace, too. We have had the 360 review for years, but now what your peers say about you could infl uence your annual performance and development review. See our article, Slick moves (page 43).

The infl uence of Facebook, Twitter and other social networks has helped shape this change, especially for younger staff.

Peer review ratings for suppliers and advisers in the employee benefi ts marketplace are harder to come by. Their services are more complex, and the needs of employer clients vary. However, for the fi rst time, Employee Benefi ts has canvassed over 400 employers to fi nd out how they rate their advisers. The Pensions Adviser Research 2013, which we will publish over the summer, will give advisers an insight into market share, what services employers use and how satisfi ed they are with them, plus employers’ future needs. For larger advisers, on request, our researchers will specify how they ranked among their peers. This will provide an invaluable commercial insight from an unbiased audience.

No matter who we are, without feedback, we cannot know if we are doing a good job.Debi O’Donovan, EditorFollow on Twitter @DebiODonovan

“Trust is a fragile thing. It takes a lot of work to achieve, but can be damaged in an instant”

Editor Debi O’Donovan [email protected] Deputy editor Debbie Lovewell [email protected] Associate editor Clare Bettelley [email protected] Features editor Tynan Barton [email protected] Senior reporter Jennifer Paterson [email protected] Reporter Ian Silvera [email protected] Art editor Deborah George, [email protected] Sub editor Bob Wells Business development managers Carmel Dickinson [email protected], Jessica Garland [email protected] Display sales executive Alexandra Clark [email protected] Event director Juliette Losardo [email protected] Sales executive Duncan Mitchinson [email protected] Event manager Lyndsey Urquhart Director, Centaur Business Publishing Phil Hayne [email protected] Publishing assistant Alice Gerard-Pearse [email protected] Head of audience marketing Steph Boukhari [email protected] Group production manager Wendy Goodbun Cover photo Jacko

Briefi ng 5News digest 8Compliance 10Employee Benefi ts Live 13Interactive 14The big question 16Up close and personal 17Neil Morrison of the Random House Group

Cover story 20Why employers need to build their relationships on trust, whether dealing with employees, providers or clients

Health and wellbeing 27Health initiatives need long-term focus

Pensions 31Keep a check on default investment funds

Pensions 33Assessing the cost of auto-enrolment

Flexible benefi ts 36Demand grows for green benefi ts

Voluntary benefi ts 40Bring-your-own-device (BYOD) schemes

Motivation 43The value of employee performance reviews

Employer profi le 46HSBC streamlines reward offering

Buyer’s guides 51� Salary sacrifi ce car plans� Group dental benefi ts

Contact directory 56Key service providers

Confessions 58

Social media

Like us on Facebook: Look for our ‘Employee Benefi ts’ page

Follow us on Twitter.com for breaking news: twitter.com/employeebenefi t

Join our Linkedin group by searching EmployeeBenefi ts

Supplement: Employee Benefi ts/Capita Pensions Research 2013

Employee Benefi ts Wells Point, 79 Wells Street, London W1T 3QNTel 020 7970 4000Fax 020 7943 8094

Subscriptions 020 7292 3719Editorial queries/press releases email [email protected] www.employeebenefi ts.co.uk

EB_0813 03EB_0813 03 23/07/2013 17:1023/07/2013 17:10

EB_0813 4EB_0813 4 23/07/2013 16:2423/07/2013 16:24

BRIEFING


Debi O’Donovan

Employers that have auto-enrolled staff into a workplace pension are more likely to pay in a 1% employer contribution than those still to go through auto-enrolment, according to Employee Benefi ts/Capita Pensions Research 2013.

The research, conducted among 370 HR and benefi ts managers, found 21% of those that have auto-enrolled staff are paying in a 1% pension contribution, but only 7% of those still to auto-enrol pay in at this low level. In turn, 23% of those still to auto-enrol pay in a 5% employer contribution, but just 10% of those that have auto-enrolled pay in this much.

The survey also showed that 73% of respondents that have auto-enrolled their staff used the option

to self-certify to simplify the calculation of pension contributions. Certifi cation will exempt employers from having to ensure the value of an employee’s defi ned contribution (DC) scheme contributions are at least equal to the statutory minimum pension contribution level over a 12-month period.

Also, 67% of respondents that have auto-enrolled used postponement, which enables

employers to delay auto-enrolment for a period of their choice up to three months from staging.

Although the Employee Benefi ts/Capita Pensions Research 2013 focused on the impact of auto-enrolment, it also looked at pensions offerings more generally.

It found that 48% of respondents offer a group personal pension as their primary pension plan, while trust-based DC schemes have overtaken stakeholder plans as the second most popular choice for employers’ primary pension plan.

Cash balance schemes have yet to gather momentum, with just 1% offering one as their secondary plan.

Auto-enrolled employers likely to make lower contributions

PENSIONS

Ian Silvera

Employee share schemes have seen much activity recently.

Employees at Sports Direct were among those to enjoy a shares payout. Under the organisation’s 2009 bonus scheme, which is set to mature this month, employees will

Share schemes pay off for employees SHARES

Future auto-enrollers will pay in more

Steven Poelmans speaking at the Summit

@ Read the full Employee Benefi ts/Capita Pensions Research 2013 at: www.employeebenefi ts.co.uk/resource-centre/research

@ Read a longer version of this article at: bit.ly/12fN6SP

@ Read also Work-life balance crucial for talent at: bit.ly/19Oa9Uw

@ www.employeebenefi ts.co.uk/news

Jennifer Paterson

A focus on fl exible working practices

and creating a good work-life balance

for employees continues to rise up

the agenda for UK employers.

The Flex Factor report, published by

think-tank RSA and Vodafone UK in

July, found UK employers could see

cost reductions and productivity

gains of up to £8.1 billion by optimising

their approach to fl exible working.

Dr Steven Poelmans, professor and

director of the Coaching Competency

Centre at the EADA Business School,

said during a plenary session at the

Employee Benefi ts Summit in

Alicante on 26 June that there were

many benefi ts to be gained from a

strong work-life balance strategy.

He said employers should look

beyond the fl exibility that work-life

balance provides to ensure that other

work-related issues, such as stress,

do not affect employees’ home lives.

“The best predictor of spousal

confl ict is [an employee] having had

confl ict that day with their boss,” he

said. “The more stress that is brought

home, the less that partners will

support [the employee’s] work.”

This can then create more stress

at home, which will affect an

employee’s performance at work,

creating a cyclical effect. “Any fl exible

policy focusing on creating a sense of

control and managing stress in

employees is going to be better,”

said Poelmans.

WORK-LIFE

New focus on fl exible work

Employee share scheme take-up rises

� 1.2 million employees opened sharesave accounts in 2012, up from 150,000 in 2011.

� 960,988 employees took part in share incentive plans in 2012, up from 908,905 in 2011.

receive a payout worth 75% of their base salary in shares priced at £1.25.

It is estimated that a Sport Direct shop assistant on a salary of £20,000 will receive 12,000 shares worth more than £77,000, based on the organisation’s share price of 645p on 22 July.

Elsewhere, the government’s

privatisation of the Royal Mail will see employees offered shares worth up to £2,000 following its proposed fl otation on the London Stock Exchange (see page 7).

Last month, the government published joint government and industry-led guidance helping organisations move towards employee ownership. The government will set aside £50 million a year from April 2014 to promote employee ownership.

Business secretary Vince Cable made the announcement on the inaugural Employee Ownership Day on 4 July.

Source: Employee share plan survey, IFS ProShare, July 2013

EB_0813 05EB_0813 05 23/07/2013 17:3823/07/2013 17:38

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BRIEFING


designed for multiple employers to use under a single trust arrangement.

However, Morten Nilsson, chief executive at master trust provider Now: Pensions, does not think lifting the restrictions is likely to affect the master

trust market. “I think Nest is competing mostly with us and [B&CE’s] The People’s Pension, but I think the restrictions open it up, so

savings among employers and their employees. [Prior to lifting the restrictions] it is feasible that an employee who wishes to make greater contributions won’t be able to do so because of the restrictions.”

The move is a positive change for the pension savings of Nest members, but it could also signal the rise of the master trusts, pension schemes that are

Jennifer Paterson

More than half (56%) of employers that have auto-enrolled staff into a workplace pension scheme and have calculated their opt-out rate have found that less than 10% of their staff opted out, according to the Employee Benefi ts/Capita Pensions Research 2013.

David Tildesley, director of client partnerships at Capita Employee Benefi ts, said: “When the project fi rst started for auto-enrolment, all sorts of fi nancial modelling assumptions were made by employers. They started off with

Auto-enrolment opt-out rates as expected, survey shows

PENSIONS

Jennifer Paterson

In July, the government announced it will lift the restrictions on the National Employment Savings Trust (Nest) in 2017, including the cap on pension contributions and a ban on transfers.

The pensions industry, including Nest, has widely supported the move. Logan Anderson, head of customer relations at The Pensions Trust, said: “The removal of Nest’s restrictions is a good thing, because these act as a barrier to encourage greater

Lifting Nest restrictions should create level playing fi eld PENSIONS

Morten Nilsson

@ Read more on pensions auto-enrolment at: bit.ly/O1Aess

@ Read a longer version of this article at: bit.ly/12fN6SP

@ Read also Nest restrictions to be lifted at: bit.ly/1a8luif

@ www.employeebenefi ts.co.uk/news

it could affect the rest of the pensions market as well,” he said.

Jamie Fiveash, director of customer solutions at B&CE, said: “Our view is that once lifted, the restrictions on Nest have a direct impact on all pension providers.”

But the change does create a level playing fi eld and puts the focus on good-quality pensions. Nilsson added: “The government should look at the quality of all workplace pension providers.”

assumptions of opt-outs of around 50% of the workforce, but I don’t think any of them ended up much above an opt-out level of 30%.”

Coca-Cola Enterprises has seen 12% of its eligible staff, who were auto-enrolled into its group personal pension plan in April 2013, opt out.

Meanwhile, the Heart of England Co-operative Society has seen 8% opt-out rates since launching a master trust ahead of its staging date in September 2013.

Utilities fi rm E.On, which raised its pensions take-up to 92% after its April 2013 auto-enrolment staging date, surveyed the 856 employees

who opted out. It found that 45% of these cited the ability to afford contributions as their top reason for opting out. A similar percentage (44%) said they would join the pension scheme in the future, while 42% said pensions were not for them and they never expect to join.

Rudi Smith, senior consultant at Towers Watson, said opt-out rates were as expected so far. “The fact there has been so much coverage about auto-enrolment has had quite an effect on people’s attitudes.”

Opt-out levels� Coca-Cola has seen 12% of its

eligible staff who were auto-enrolled into its GPP opt out.

� The Heart of England Co-operative Society has seen

8% of staff opt out of its master trust pension two months before staging.

� E.On has increased take-up of its GPP to 92% after staging.

Coca-Cola saw a 12% opt-out rate

Ian Silvera

The privatisation of Royal Mail will see

shares worth up to £2,000 awarded

to each of its employees.

Business secretary Vince Cable

confi rmed that Royal Mail staff would

be given 10% of the organisation’s

shares after its fl otation on the

London Stock Exchange planned for

later this year.

The government has hailed this as

the second biggest employee share

scheme in 30 years in terms of the

number of workers who will benefi t,

second only to the privatisation of

British Telecom in 1984.

The percentage of shares being

allocated to staff is also the highest

for an employer with more than

100,000 employees.

Rolls-Royce, which was privatised

in 1987, gave 10% of its shares to

employees and British Airways, which

went private in 1987, awarded 9.5% of

its shares to employees, but both had

fewer than 50,000 staff.

SHARES

Free shares for mail staff

EB_0813 07EB_0813 07 23/07/2013 18:4923/07/2013 18:49

8 I August 2013 I www.employeebenefi ts.co.uk

NEWS DIGEST

PENSIONS

COCA-COLA sees 12% auto-enrolment opt-outAt its staging date in April 2013, 134 of the 1,151 employees who were auto-enrolled (about 25% of the workforce) into its group personal pension plan opted out.

http://bit.ly/1a8lr5X

EMI GROUP completes DB pension insurance buyoutThe £1.5 billion pension insurance buyout, which was completed by Pension Insurance Corporation and advised by Mercer, covers 20,000 scheme members.

http://bit.ly/1a8lNcM

WITHERS raises group personal pension take-upThe global law fi rm increased the take-up of its GPP to 85% after introducing an online fl exible benefi ts plan for its 370 staff.

http://bit.ly/11d0CGb

POLICE pensions could be cut for misconductThe Home Affairs Select Committee

the 9.75% increase, up from the current salary of £66,396, and has launched a consultation on MPs’ pay and pensions.

http://bit.ly/131xDDK

MOTIVATION

PROPELLERNET rewards staff with dream scheme Its motivation scheme, Dream Balls, allows employees to share in the social media fi rm’s collective success by seeing their own dreams come true.

http://bit.ly/12ZHF5h

ASDA rewards 1,000 staff for long service More than 1,000 employees have received awards for a combined

47,135 years of service at the supermarket chain’s Big Anniversary event.

http://bit.ly/12NOZQf

READING UNI launches online recognition portalThe university’s Celebrating Success scheme, provided by AYMTM, allows managers to nominate employees for awards, which can be redeemed for vouchers from a range of retailers.

http://bit.ly/1cje0s3

SHARE SCHEMES

SPORTS DIRECT staff to receive shares payoutMore than 2,000 employees are in line for bonuses worth more than £70,000 in August when the retailer’s 2009 bonus share scheme will mature.

http://bit.ly/17qloB2

Barclays: cycle staff strike over pay

Sports Direct: shares payout for staff

This month’s trends

NEW PRODUCT ROUND-UP

� Access to target date funds extendedBlackRock is extending access to the funds to meet a surge in demand arising from auto-enrolment.

http://bit.ly/17i6Jrv

� BITC enhances engagement guidelinesThe new version of its public reporting guidelines

on employee engagement and wellbeing include detail supplied by the investor community.

http://bit.ly/17i72SZ

� Ellipse enhances online group risk platformIt will provide fl exible and voluntary quotes for group life and critical illness cover.

http://bit.ly/12qDb6j

� Providers partner for auto-enrolmentBarclays will use Benefex’s technology and additional services to support employers through the auto-enrolment process.

http://bit.ly/192FV2i

� National Dental Plan launches new productIts Radiant product provides

100% reimbursement for preventative and minor treatments.

http://bit.ly/1a8mjrw

� Sodexo launches online incentives portal Employers can recognise employers’ work by using a choice-based approach to incentivising staff.

http://bit.ly/17R2d41

has called for an established scale of fi nes that could be docked from police offi cers’ pensions in cases of the most grave misconduct.

http://bit.ly/13h4bMS

PAY & BONUSES

BARCLAYS CYCLE HIRE staff strike over payEmployees took industrial action on 16 July, citing the imposition of a 2% pay increase for 2013 and a stop to overtime.

http://bit.ly/131xRKU

NETWORK RAIL executive incentive plan approvedThe new long-term incentive plan (L-tip) for executive directors was developed through discussions with members at a series of meetings and workshops.

http://bit.ly/15Z8drE

MPS to receive £74,000 salary in 2015The Independent Parliamentary Standards Authority has proposed

£8bncould be generated for UK organisations through fl exible working

http://bit.ly/192FC7R

@ Follow the bit.ly url to read the full news story

EB_0813 8EB_0813 8 23/07/2013 16:5423/07/2013 16:54


ROYAL MAIL staff to receive £2,000 share payoutThe government has confi rmed it will give staff 10% of shares after Royal Mail’s proposed fl otation on the London Stock Exchange.

http://bit.ly/12qCHx4

INTERSERVE staff see £1,000 sharesave profi t increaseMore than 700 staff who are signed up for the sharesave scheme, which is administered by YBS Share Plans, will see an average profi t increase of £1,122.

http://bit.ly/12r0GQQ

VOLUNTARY BENEFITS

MERLIN ENTERTAINMENTS launches discount cardsThe organisation has rolled out the Gourmet Society card and given employees discounted cinema tickets to extend its voluntary benefi ts offering.

http://bit.ly/1cqccgV

JCT600 sees 56% take-up of voluntary benefi ts planThe car dealership’s Just Rewards scheme, which is provided by Personal Group, has been taken up by more than half of its 1,350 employees since it was introduced in February 2013.

http://bit.ly/131y4xK

COMPANY CARS & FLEET

YOUR HOUSING GROUP launches car schemeThe salary sacrifi ce car arrangement, provided by Lex Autolease, covers all regular car running costs, such as insurance, breakdown cover, servicing and maintenance.

http://bit.ly/11d0TJj

HEALTH & WELLBEING

TUI UK AND IRELAND targets employee absenceThe travel fi rm hosted a wellbeing day in June to focus on developing a holistic health and wellbeing

programme across the business and to reduce sickness absence.

http://bit.ly/19d7QwK

ROYAL BRITISH LEGION extends eyecare schemeThe scheme, provided by Specsavers Corporate Eyecare, will be extended to qualifying staff in its manufacturing and wood fabrication factories.

http://bit.ly/18j8TLS

BAUSCH AND LOMB hosts employee wellness day The eye health product supplier’s fi rst in-house wellness day included a series of health promotions and interactive activities aimed to promote healthy lifestyles among its 120 employees.

http://bit.ly/14PIuzp

Siemens UK boosts pensions take-up to 98% About 1,000 of Siemens UK’s 13,000 employees were not in its trust-based defi ned contribution (DC) pension scheme before its auto-enrolment staging date of 1 May. The technology business started communicating auto-enrolment to staff during its fl exible benefi ts enrolment window in November 2011.

http://bit.ly/192F3Lk

Kier appoints BradshawKier Group has

appointed Mark

Bradshaw pensions and

reward director.

His previous roles in

the industry include: director of

reward and recognition at Tata Steel

Europe and HR director, reward and

engagement at Amey.

Davidson sets up consultancyJenny Davidson,

formerly of CSC, has

set up a consultancy,

Reward Innovation, to

work on pension and

reward projects, including auto-

enrolment, the redesign of incentive

plans and review of global benefi ts.

� She will speak at Employee

Benefi ts Live on 26 September.

AmEx promotes PerkinsAmerican Express has

promoted Sarah

Perkins to project

manager, HR. She was

previously employee

health and wellbeing manager.

Total rewards role for HarrisBaker Hughes has appointed Angela

GPP is the most popular pensionAlmost half (48%) of the respondents to the Employee

Benefi ts/Capita Pensions Research 2013 offer a group

personal pension (GPP) scheme as their primary pension plan.

Trust-based defi ned contribution (DC) pensions and stakeholder pensions

are the second and third most common plans. http://bit.ly/ZJEWKs

48% 16% 14%of respondents offer a GPP as their primary pension provision for staff

of respondents offer a trust-based defi ned contribution (DC) pension as their primary scheme

of respondents offer a stakeholder pension as their primary pension provision for staff

31%of respondents do not receive occupational health support from their employer

http://bit.ly/131ydBh

EXCLUSIVE RESEARCH

PEOPLE MOVES

@ Register to receive all the latest news via email at www.employeebenefi ts.co.uk

Harris total rewards manager,

Europe. She joined the organisation

in 2010 as compensation and

benefi ts manager for the UK and

Norway. Previously, Harris was

reward manager at Boots UK.

Green in interim role at HSBCHSBC has appointed Rob Green

interim compensation and benefi ts

project manager. His previous roles

include interim compensation and

benefi ts manager at Amazon and

interim global compensation project

manager at Reckitt Benckiser.

Palmer moves up at PeugeotPSA Peugeot Citroen

has promoted

Stephanie Palmer to HR

director – UK, Ireland

and Scandinavia. She

has held the role of head of reward

and development with the

organisation since April 2011.

Robertson is head of rewardNovartis Pharmaceuticals has

appointed Tim Robertson head of

reward. His previous roles in the

industry include senior reward

manager at Santander and senior

reward manager at Barclaycard.

BGL GROUP relaunches health checks for UK staffIts ‘Know your numbers’ annual review monitors health indicators such as height, weight, body mass index to body fat percentage, blood pressure and total cholesterol.

http://bit.ly/13ro0jB

EB_0813 9EB_0813 9 23/07/2013 16:5423/07/2013 16:54

TAX AND COMPLIANCE


@ www.employeebenefi ts.co.uk/compliance

Legislative changes announced in June and July

Ian Silvera

Employers must take care over the remuneration promises they make to employees following a decision by the Court of Appeal.

In the High Court case of Attrill and others v Dresdner Kleinwort, employees succeeded in their argument that their employer was contractually obliged to pay bonuses from a guaranteed minimum bonus pool of €400 million (£343 million) it had promised to set up.

The court ruled that the bank had acted in breach of contract when it reduced the bonus pool and the size of bonus awards.

Paul Griffi n, head of employment and labour at Norton Rose, said: “To an extent, there is something for every employer to be worried about with this decision.”

The case arose after Allianz’s announcement of the possible sale of Dresdner Kleinwort in 2008. Subsequently, the chief executive of Dresdner Kleinwort called a ‘town hall’ meeting that guaranteed to set up a minimum bonus pool, from which bonuses would be paid in early 2009.

Employers must take care on remuneration promises

PAY AND BONUSES

@ Read a longer version of this story at : bit.ly/RYrvb6

Some staff were awarded guaranteed bonuses at that time. In December 2008, individual discretionary bonuses were awarded, which were to be paid the following January. However, the bank said these were subject to a material adverse change clause, which meant the bonuses did not have to be paid if there were material changes in the bank’s position in November or December. In the event, the discretionary bonuses were reduced by 90%.

The latest information on legislation and tax issues affecting employee benefi ts, including promised bonus payments, the interpretation of Tupe regulations and a change to the Pension Protection Fund cap

LEGISLATION

� The government is to axe automatic annual pay rises in the civil service under a pledge to make £11.5 billion worth of public sector savings in 2015/16. The move, announced in the Spending Review, confi rmed that public sector pay rises will be limited to an average of up to 1%.� The restrictions on the National Employment Savings Trust (Nest) will be lifted in April 2017 (see briefi ng, page 7).

Employers, particularly those in the private sector that have recently acquired employees from the public sector or plan to do so, will be relieved by a recent decision of the European Court of Justice (ECJ) concerning the interpretation of the Transfer of Undertaking (Protection of Employment) (Tupe) regulations.

The ECJ found that employees cannot continue to benefi t from collectively agreed pay rises once they have transferred to a new employer which is neither party or privy to the pay talks.

This case has very real implications for employers that have acquired, or will acquire, employees to whom industry- or sector-wide negotiated terms apply. This is by no means limited to scenarios where public sector employees governed by collective bargaining have transferred to the private sector, as arose in this case.

Many transferee employers will have been unaware that the operation of the 2006 Tupe regulations might mean they inherit liability for year-on-year pay rises over which they have no say. Also, those that were aware of this litigation may have been put off taking on such businesses.

The decision of the ECJ should provide much-needed certainty for employers and employees alike by clarifying that pay levels will generally be preserved on transfer, but are unlikely to be subject to subsequent increases not agreed or negotiated by the transferee employer.

The ECJ has now made it clear that the underlying principle of the Tupe directive is not solely to safeguard the interests of employees on a business transfer, but also to ensure a fair balance between the interests of those staff and the transferee.

Tom Bray is principal associate, human resources practice group, Eversheds

European court rules on Tupe and pay rises

@ To read more advice from legal experts, go to: bit.ly/RYrvb6

ADVICE FROM THE EXPERTS

@ Read more on legislation at: bit.ly/RYrvb6

� The Pension Protection Fund (PPF) cap level is to be increased. The new rules mean an employee whose employer goes bust before he or she reaches the scheme’s normal pension age will generally see his or her benefi ts reduced in

two main ways: compensation will cover 90% of (broadly) the pension the member would otherwise have been entitled to from the scheme, and the member’s scheme pension will be restricted to a statutory compensation cap, currently set at £34,867.04 for a 65-year-old, even before the 90% adjustment.

EB_0813 10EB_0813 10 23/07/2013 18:2423/07/2013 18:24

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EB_0813 12EB_0813 12 22/07/2013 15:0722/07/2013 15:07

EVENTS


@ www.employeebenefi tslive.co.uk

A host of industry experts and top names from the reward and benefi ts world will enlighten delegates at Employee Benefi ts Live on 25 and 26 September

Ex-MI5 boss to give change tips

Drop in for some expert guidance

Award winners to share secrets of their successDelegates can discover what makes an award-winning employee benefi ts strategy in the closing keynote address of Employee Benefi ts Live on 25 September.

Past Employee Benefi ts Award winners, including Asda, Merlin Entertainments, Capital One, First Group, Random House Group, Bwin.Party and City Health Care Partnership CIC will give share their tips and secrets for success in a variety of benefi ts.

The areas covered will include: employee motivation, pensions, share schemes, health and wellbeing, work-life balance strategy, total reward strategy and international benefi ts.� For more information and to register to attend, visit www.employeebenefi tslive.co.uk

@ www.employeebenefi tslive.co.uk

Eliza Manningham-Buller, former director general of MI5, will give the opening keynote address at Employee Benefi ts Live on 25 September, sharing her experiences and offering guidance on managing change when under pressure.

Manningham-Buller, who headed the UK’s security service from 2002 to 2007, led the organisation though substantial change in the wake of 9/11 and the threat from Al-Qaeda. During this time, MI5 doubled in size and changed its approach to the professional development of staff.

On 26 September at Employee Benefi ts Live, Candice Le Louarn, director of employee benefi ts and engagement at Barclays, will deliver the keynote address looking at how to successfully engage employees from all generations and across the globe.� For more information and to register to attend, visit www.employeebenefi tslive.co.uk

The Experts Arena at this year’s Employee Benefi ts Live will feature several drop-in sessions where delegates can gain advice and guidance.

In the auto-enrolment drop-in sessions, delegates can seek advice and support from legal experts and industry mentors, while the salary sacrifi ce drop-in sessions will have tax and legal specialists on hand.

Careers clinics will offer the opportunity for delegates to gather career advice from industry mentors and fi nd out how to progress in benefi ts.

Delegates can also attend debates aimed at raising the profi le of reward and HR professionals in current pay debates, particularly around high and low pay issues.� For more information, visit www.employeebenefi tslive.co.uk

Jill Cunnison of Capital One

Richard Murray of FirstGroup

Debra Corey of Merlin

EB_0813 13EB_0813 13 22/07/2013 17:5822/07/2013 17:58

INTERACTIVE


Viewpoint

Debbie Lovewellconsiders the value of exercise

As a self-confessed ‘gym-phobe’ for more than a decade, many of the benefi ts of exercise have passed me by. Yet, thanks to a gym opening near Employee Benefi ts’ offi ces, this has all begun to change.

One pleasant surprise has been the positive impact of lunch-time gym sessions on mood, energy levels and afternoon productivity. It certainly ties in with research by HR recruitment fi rm Ortus, which found that providing breaks for employees to visit the gym or to exercise during offi ce hours can help to boost day-to-day productivity.

According to Robert Pozen, author of Extreme Productivity and senior lecturer at Harvard Business School, not only can exercise give staff more energy, but when compared to sedentary colleagues, those who have exercised during their lifetime could have more brain cells when they reach their 60s, 70s and 80s. As more people look set to stay in work for longer, this can only be an advantage.

When I entered the world of employee benefi ts a decade ago, HR and reward professionals could struggle to justify the cost of wellbeing perks, such as exercise classes, to their fi nance colleagues, who wanted to see cold, hard evidence of the impact of these on the bottom line.

It can still be hard to isolate the impact of such initiatives on productivity, sickness absence and motivation, but employers are concluding there is a link. Rarely a month passes when we do not hear of organisations holding health and wellbeing events for their staff.

Getting staff fi t for a longer working life

The statistics say that auto-enrolment works for larger employers, with far fewer

opt-outs than fi rst predicted, but now comes the hard part: how do we increase the appreciation of these benefi ts so there is a return for the employer?

It’s sad to see inertia as the main thing responsible for the boom in pension savings, but it is inevitable, when the engaged have already joined or taken the active decision to opt out.

So now we’re faced with the challenge of articulating the value of a benefi t to which both the organisation and staff contribute, but is perceived to be of little value, and is often seen as inferior to the benefi ts

enjoyed by previous employees.Pensions have never been a

particularly engaging benefi t. However, a good defi ned benefi t scheme can aid retention, although this can lead to problems of its own, as staff recognise its value but become disinclined to develop, ultimately becoming less productive and simply ‘seeing out’ their time until retirement.

So will we see a rush towards total reward statements or fi nancial dashboards to illustrate the value of pensions within the reward package?

There’s still a long way to go for employers to get a decent bang for their buck here.John Chilman, group reward and pensions director, FirstGroup

Can staff be convinced of the real value of pensions?

Group risk benefi ts can help productivityThe Employee Benefi ts Group risk supplement 2013, published in July, showed the extent to

which group risk benefi ts align with the economic need to boost productivity and growth.

The UK workforce has changed dramatically in the past 30 years, but many employers’ approach to staff benefi ts has

not kept pace with staff needs.For example, staff are three times more likely to suffer long-term illness than to die, but only one in 10 has access to income protection at work.

Ensuring the fi nancial security of staff also drives engagement, recruitment and retention.Mark Forato, chief marketing offi cer, Unum UK

LINKEDIN DISCUSSION BOARD

QWhat does your organisation do to make a difference in employees’ lives?

@ Making a difference to employees’ lives with responsive benefi ts in all their guises

must have, as its core model, front-line engagement with the end client: the employee. Understand what would deliver to their priorities and, of course, fi nd a balance, because one

size does not fi t all. Manufacturing will have a completely different employee wish-list from, say, a technology or professional services organisation. Talk to the target market; questionnaires and surveys work at one level, but in some cases are the antithesis of engagement. Listen to the feedback, and tailor the product to match.

Sue Grant, former projects manager, global reward, GKN

Join our Linkedin group by searching EmployeeBenefi ts

Tackling stress is vital for employers

BMW [winner of the Grand Prix at the Employee Benefi ts Awards] is an

encouraging example of how an organisation can take a proactive approach to managing health and wellbeing at work.

Implementing this type of support service, where staff can discuss both personal and work problems, will be of huge benefi t to the organisation, because employees often feel vulnerable in disclosing that they are feeling stressed because of the perceived stigma attached to any mental health problem.

The cost of work-related stress to the economy reached £6.5 billion last year. Staff are often an organisation’s biggest asset, so it is in its interest to have a healthy workforce.

Creating a culture of wellbeing is more likely to result in enhanced individual, team and organisational performance. If staff can access good-quality support, this is likely to impact positively on their morale and commitment to the organisation.

Having senior managers who are trained to spot the early signs of stress will contribute to the successful management of stress in the workplace.Natasha Shearer, founder, Workplace Stress Solutions

Follow Debbie Lovewell on Twitter: @DebbieLovewell

@ email us at [email protected] with your views

EB_0813 14EB_0813 14 22/07/2013 17:3622/07/2013 17:36


A great aspect of my job is the variety of organisations I work with.

In the last couple of weeks, I have been talking about the links between performance, reward and values with the NHS Pay Review Body; moves towards more market-driven reward with the Universities and Colleges Employers’ Association (UCEA); and the links between reward and engagement at an Aon Hewitt seminar.

Whatever the sector, in this climate of continuing austerity but labour market recovery in some specialisms, the key issue for most UK employers appears to be this: how to utilise reward spend most effi ciently to generate improved employee engagement and performance, at a time when many employees are feeling the proverbial overworked and underpaid, as real earnings decline.

Nita Clarke from the Engaging for Success movement told the UCEA leaders that improvements in employee engagement could potentially generate £18 billion additional productivity for the battered UK economy, so it is no wonder that the prime minister is interested. There was also much discussion of the Chancellor’s aggressive commitment to remove pay increments across government and the effects on staff engagement.

The press is full of examples of the diffi culties of linking these two factors, ranging from the Communications Workers Union’s rejection of Royal Mail’s 8.6% three-year pay offer to the furore over the signifi cant increase in MPs’ pay. Sir Ian Kennedy, head of the Independent

From the frontline

Engagement is the key to recoveryDuncan Brown looks at making reward fi t the workforce's needs

FROM THE WEB

The Independent Parliamentary Standards Authority has called for MPs’ pay to rise to £74,000 in 2015. It has also launched a consultation, closing in October, on MPs’ pay and pensions.

MPs should receive the same treatment

as other public sector workers. Four years without a pay rise, followed by a 1% pay rise and amendments to their pension scheme. That is fair democracy, isn’t it? They should be leading by example, not one rule for them and something different for everyone else. Anonymous

“We can use reward more effectively to boost engagement and recovery”

Parliamentary Standards Authority, seems unduly optimistic in hoping for a once-and-for-all settlement to parliamentary pay.

The Whitechapel Gallery near my offi ce has an exhibition entitled The Spirit of Utopia. All this may suggest that engaging employees through pay and reward is a diffi cult, contentious, near-impossible process. But we defi nitely can use reward more effectively to boost engagement and recovery.

A major new study from Britain Thinks, (Ex)Aspiration Nation, published in July 2013, about the attitudes and aspirations of today’s teenagers, fi nds a generation surprisingly

unscarred and uncynical in the face of economic uncertainty, high youth unemployment and mounting student debt.

The survey suggests a move back from the individualistic, money and celeb-obsessed Generation Y towards a more self-motivated, pragmatic focus on the need to build employability (72% claim “to know what I need to do to get

the job I want”), combined with a more idealistic streak to “have a job you love” (70%), even if the fi nancial rewards are lower.

Economic austerity will end at some point and more employers need to be thinking ahead about how to offer more jobs to this generation, with reward packages that can meet their needs and expectations.

As one sixth former told the researchers: “You just have to have optimism.”

Follow us on Twitter: twitter.com/employeebenefi t

*Ranked by the number of page impressions from

17 June to 15 July 2013.

Most common causes of sickness absence

Auto-enrolment prompts employers to review their benefi ts offering

Most common sickness absence strategies

SAP to outsource benefi ts system ahead of auto-enrolment

Coca-Cola sees 12% auto-enrolment opt-out

Top tips for communicating fl exible benefi ts

How employers can promote heart health in the workplace

Tui UK and Ireland targets staff absence

Asda awards staff for long service

Hardest working man… ever?

1

2

3

4

5

6

7

8

910

THE MONTH IN NUMBERS

47%60031%of UK adults use their personal devices for work purposes (Voluntary Benefi ts, see page 40)

HSBC employees are benefi ts champions (Employer Profi le, see page 46)

pay pension contributions above the minimum requirement (see Pensions Research 2013)bit.ly/18yz5T0

TOP 10 MOST VISITED STORIES ON THE WEB*

Follow Duncan Brown on Twitter: @duncanbHR

EB_0813 15EB_0813 15 22/07/2013 17:5322/07/2013 17:53

THE BIG QUESTION


@ www.employeebenefi ts.co.uk/comments

Senior pay in local government is a political hot potato, with regular sensationalist stories in the press about pay levels with the age-old comparator of ‘more than the prime minister’.

For me, stories like this are not helpful in morale and employee engagement terms because they tend to present an unbalanced view. Looking to David Cameron rather than to counterparts in the private sector lacks a sense of the whole story of senior pay in local government and creates misunderstanding in the workforce.

More organisations are moving towards contribution- or performance-related pay, and in the most recent Spending Review, this was made a clear priority as the government moves away from a traditional time-served progression approach.

For HR managers working in local government, a clear part of our role is ensuring our pay policies are transparent, easy to understand and demonstrate value for money. This openness about pay and how decisions are made should engender trust in the wider workforce, and be used as an engagement tool.

In HR, we have a critical role in developing and communicating our employee value proposition, both within our organisations as an engagement and retention tool, and to infl uence the media to attract the most knowledgeable, skilled senior people into our organisations.

Recent press coverage of senior severance payments and reward packages of executive team members has highlighted the necessity for HR and, specifi cally, reward managers to ensure frameworks are in

place to guide an organisation’s decision-making and protect its public image.

The reward manager’s role is to create a framework fl exible enough to support recruitment and retention, while being transparent to employees. We often see decisions taken spontaneously without the involvement of HR and without considering the longer-term impact. This can involve stepping outside frameworks such as pay bandings.

There is also the impact on other employees to consider, not only in respect of equality, but also how a lack of consistency in decision-making can harm motivation and productivity.

There is also a need to involve HR to ensure reward packages are fl exible enough to be tailored to motivate individuals. Here, HR can operate alongside senior managers to ensure objectives align with strategic aims, with the right incentivisation scheme in place.

Legislative changes around annual and lifetime allowance restrictions for pensions and changing tax brackets also mean HR’s expertise is needed in discussing pay decisions.

Organisations leave reward experts out of senior reward decision-making at their peril because there is a risk of not considering the wider options or appraising the wider risks.

Over the last decade, pay for a FTSE 100 chief executive has risen from 100 times that of the ordinary worker to 130 times. Research from the High Pay Commission suggests the ratio was about 15:1 in the late

1970s. This implies that the responsibility to relate executive pay to conditions for the wider employee base is not being taken entirely seriously by remuneration committees. That could have negative consequences for UK businesses. Research has suggested that an increase in the pay gap between the highest and lowest-paid employees leads to a decline in organisational performance.

The requirements stipulated in the corporate governance code and the effect of top pay on employee morale provide both a regulatory and a practical basis for HR managers to play a role on executive remuneration committees.

Such a move would also encourage a necessary re-evaluation of the role of HR more generally. It is somehow diffi cult to imagine HR managers calling for measures that would improve staff morale or working conditions.

This perhaps refl ects the extent to which HR departments operate as a tool of senior management for imposing their will on staff, rather than as a medium for dialogue with the aim of engaging and motivating employees. Giving HR managers a responsibility to challenge executive pay, backed up by the corporate governance code and alongside the High Pay Centre’s recommendation of an elected staff representative on remuneration committees, would help make British workplaces happier and more productive.

How should HR be more involved in high pay decisions?

Luke Hildyard is head of research at the High

Pay Centre

Ian Hodson is reward and benefi ts manager at the

University of Lincoln.

� Ian Hodson will be speaking at Employee Benefi ts Live on 25 September.

� Raffaela Goodby will be speaking at Employee Benefi ts Live on 26 September.

Raffaela Goodby is head of human resources and

organisational development at Birmingham City

Council.

This month’s big question:

Do you agree with these views? Join the discussion by searching for the EmployeeBenefi ts group on

EB_0813 16EB_0813 16 22/07/2013 16:4422/07/2013 16:44


UP CLOSE AND PERSONAL@ www.employeebenefi ts.co.uk/jobs

N eil Morrison, group HR director at the Random House Group, decided to join the world of

employee benefi ts after a spell as a clinical psychology lecturer.

The University of Sheffi eld graduate wanted a change from the theoretical and research-orientated world of academia, and so became personnel services offi cer at Dartford and Gravesham NHS Trust. Morrison explains: “I wanted to do something that was applied, and I enjoyed doing something where you can see a connection and a difference.”

Morrison says he was lucky to secure the job because competition was fi erce. “Lots of people advertised that they wanted people with two or three years of experience, but there were very few people willing to give anyone with zero experience that fi rst opportunity,” he says.

Morrison’s next job was as an HR adviser at Rentokil Initial Management Services. He then spent eight years at the Home Retail Group, latterly as HR

Keep HR simple and staff will reap the rewardsNeil Morrison, group HR director at the Random House Group, says HR should be kept simple, with professionals concentrating on making their organisation a better place for employees to work

manager leading a team of HR managers and advisers supporting corporate functions. There, he developed a graduate leadership programme and implemented a group-wide approach to measuring employee engagement.

Morrison joined Random House as group HR director in 2008. The publishing fi rm won this year’s Employee Benefi ts Award for ‘Best work-life balance strategy’ for its proactive encouragement of its workforce to achieve a good work-life balance.

Dealing with peopleMorrison says one of the main lessons he has learned over his career is that HR professionals sometimes make HR too complicated. “We over-manufacture what we do and forget we are dealing with people,” he says. ”I think it’s important to remember we are dealing with human beings, not with an enemy we’re trying to beat. We don’t need to overcomplicate the processes.”

Morrison says HR should be a positive infl uence, seeking to

contribute to an organisation rather than trying to gain control. “Everything I do is about trying to do things simply and easily, and in a way that sits well with the organisation I work in,” he says.

Morrison’s biggest hurdle has been fi nding the right calibre of HR professionals to work with. “Getting people who really understand the way I want to deliver HR isn’t easy,” he says. “I look for people who have a good philosophy when it comes to working with people. You can train skills, but it’s harder to train mindset and attitude.”

Morrison says the tough economic environment is a challenge for employee benefi ts practitioners. “Using benefi ts as a retention and motivation tool can be fantastically powerful,” he adds. “That is often a real challenge.

“Also, understanding the impact of changes in pension provision is going to be quite remarkable. For example, employees staying in the workplace, people’s ability to retire versus their inability to retire, and the impact that will have on workforce planning: all that will be interesting.”

Morrison believes HR and reward departments should be focused on making organisations better places to work. “My whole career has been trying to make work a better place to be,” he says. “As long as I’m coming into work and feeling that my team and I are making it a better place for the people that work there, then that’s all the reward I need.” Ian Silvera

Q&A

September 2008-present group HR director, Random House Group

2000-2008 HR manager, Home Retail Group

1998-2000 HR adviser, Rentokil Initial Management Services

1996-1998 Personnel offi cer, Dartford and Gravesham NHS Trust

CURRICULUM VITAE

Who is your inspiration?A name that springs to mind is [Olympic medallist] Ben Ainslie. The ability to go back time and time again to perform at the high levels that he’s done, in a low-profi le way, is everything.

Can you recommend a book?My early philosophies came from John Paul Sartre and existentialism. That drove my thinking on how you treat people in life and work. One of the fundamental principles of Sartre’s work is that you are as other people see you. So it doesn’t matter what you want to be, you are defi ned by the views of others. Often, HR doesn’t get that point. It believes it is one thing, and in fact it’s perceived as something else by the organisation. Therefore, the only way to change that is to act.

What are your hobbies?I do a lot of writing and I’m a quite frequent blogger about HR. I also do some photography and cooking.

What is your favourite benefi t?Random House’s summer hours scheme, between the late May and August bank holidays. People work an extra 45 minutes a day and fi nish at lunchtime on Friday. So throughout the summer, staff get 12 to 13 Friday afternoons off.

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EB_0813 11EB_0813 11 18/07/2013 15:3518/07/2013 15:35

Re-branding to become Co-operative Flexible Benefi ts is so much more than just a name change; we genuinely believe we offer something different with a truly co-operative suite of benefi ts.

Sharing the benefi ts of co-operative partners wherever possible, it is our vision to provide employers with a compelling and trusted range of products and services for their employees that is truly ‘good for everyone’. With the suite of benefi ts now on offer, every employee at a client business should be able to access at least one benefi t for themselves and/or their family.

Our Childcare Voucher business has been operating since April 2005, and we launched our Cycle to Work scheme in September 2010; approximately 16,000 employees have received childcare vouchers or cycles through the Cycle to Work scheme to date.

The Co-operative Childcare, leading ethical childcare provider has a chain of 50 nursery settings from Newcastle to Southampton, with further acquisitions planned for 2013. Employees who use a Co-operative Childcare nursery and pay using childcare vouchers supplied by Co-operative Flexible Benefi ts, can benefi t from a 5% discount, in addition to members* earning share of profi ts on every transaction.

Co-operative Energy is committed to playing its part in tackling climate change and it supports renewable energy. With over 4,000 energy tariffs in the UK, choosing one can be very complicated. It’s hard to compare suppliers’ prices and even harder to monitor the impact of frequent price changes. Co-operative Energy has one product with a very simple pricing structure – a monthly fi xed charge and a single price per unit of energy consumed. Switching to Co-operative Energy through Co-operative Flexible Benefi ts will result in a £50 credit to your account after 3 month’s supply.

All of your employees will need a bank account, so we’re delighted to offer the opportunity to receive £100 cashback for switching to a current account with The Co-operative Bank, part of the largest consumer co-operative in the UK.

The Co-operative Legal Services exists to provide a trusted source of legal advice with a commitment to offering straightforward value-for-money services and an ethos of social responsibility. The legal profession is often viewed with suspicion and distrust – The Co-operative Legal Services aims to dispel these perceptions by providing free legal advice and fi xed-price legal services.

Working in partnership with The Phone Co-op, employees can access an exclusive home-phone and broadband offer. The Phone Co-op is the UK’s only customer-owned telecoms provider, offering award-winning services based on good value, excellent service and a socially responsible approach to business.Most of your employees and their families will have the need for healthcare at some point

in their lives, so we’re pleased to be able to offer a truly different solution through our partner Health Matters, their straightforward and professional service should benefi t the majority of your employees.

Discounts on Funeral Plans covering the cost of funeral arrangements in advance, enabling employees to plan ahead for both themselves and their loved ones, making sure they receive the funeral they would like, whilst securing the cost of that funeral today.

Grace Consulting has over 30 years’ experience in helping families fi nd the right care for elderly or dependent relatives. With the aging population, many more families are faced with making decisions about the long-term care of their relatives, and the choices can be complex and daunting. We work with Grace Consulting to provide a Family Care Advice service and assist employees to fi nd their way through the maze of medical, fi nancial and legal issues at this diffi cult time.

Working with Zenith we are able to provide a Green Car Scheme, an exciting and innovative fl exible benefi t which enables you to give all of your employees the opportunity to drive a low cost, low emission, brand new car as part of their reward package.

COMING SOON Payroll Giving enables employees to make tax-effi cient donations directly from their salary to their chosen charitable cause. Charities rely heavily on this regular income, with the added benefi t that they receive the total donation including tax without having to reclaim it at a later date. With our ethical values of openness, honesty, social responsibility and caring for others, Payroll Giving is a perfect addition to our suite of benefi ts and it is freefrom charges to all who use it.

Co-operative Flexible Benefi ts is taking an innovative approach to the benefi ts market in delivering a unique solution and a true alternative to the traditional commercial package available from other providers. Our commitment is to deliver excellence in everything we do, from the Customer Service Offi cers on our Helpdesk, to the support from your dedicated Regional Account Manager, or the production of bespoke marketing material to ensure maximum employee engagement.

All of our services and procedures are independently audited by KMPG to ensure HMRC and employment law compliance, so employers can be reassured that the faith and confi dence they put in one of the UK’s most trusted brands is truly validated.

We believe in working together to achieve benefi ts for all, to make our communities better places to live and work.

*Members of The Midcounties Co-operative earn share of profi ts on every transaction. To fi nd out more about the benefi ts of becoming a member please visit http://www.midcounties.coop/membership.

Truly good for everyone

Advertisement Feature

EB_0813 12EB_0813 12 18/07/2013 15:3518/07/2013 15:35


Basing relationships on trust is a vital matter for employers, whether dealing with employees, providers or clients, says Clare Bettelley

POSITION OF TRUST

EB_0813 20EB_0813 20 19/07/2013 15:5719/07/2013 15:57

COVER STORY


�Sometimes it’s about employers promising less instead of promising the earth and not delivering”Claire McCartney, CIPD

Personnel and Development (CIPD), agrees, particularly where employee benefi ts are concerned. “Sometimes it’s about employers promising less, then employees might trust more, instead of employers promising the earth and not delivering on that,” she says.

“It’s not [employers] saying they will be more paternalistic towards [employees] and that they will do all these types of things around [employees’] wellbeing and give them all these benefi ts, but actually saying realistically, in the current economic environment, there are probably only two or three things [employers] can do, but [they will] deliver on those.”

Thomas Martin, a procurement specialist at procurement service provider Proxima, says employers can optimise the performance of a new benefi ts provider by having robust service level agreements (SLAs) put in place.

“The biggest mistake is [employers] taking things at face value from a sales person and believing that will happen once they go into their contractual relationship,” he says. “Employers need to make sure they tie down everything that’s sold to them into the contract, so they have that protection.”

But Richard Wilding, professor of supply chain strategy at Cranfi eld School of Management, says SLAs are only part of the process of building trust with third-party providers, and that the secret to forming a

long-lasting, successful relationship lies in giving the relationship time to fl ourish.

“We talk about C3 behaviour, which is co-operation, co-ordination and then collaboration,” he says (see graph, page 23). “The big mistake many organisations make, even with their own people, is to go rushing up to people and say ‘hey, collaborate with me’ and they get a pretty poor response. People just can’t relate to that.”

Wilding says employers should focus instead on developing a relationship that is low-risk and offers both itself and the provider something of value within a fi xed period of time.

But employers need to qualify exactly what they want before embarking on this process with new providers, which may involve sourcing references from fellow employers and other businesses that are already working with the providers in question, to check out their experiences.

Proxima’s Thomas says: “Another good thing

A series of scandals in the banking industry, including product mis-selling and huge executive pay deals, has caused a breakdown in trust between investors and bank

staff. This has prompted business leaders in all market sectors to examine, and perhaps try to rebuild, trust in their own organisations.

A desire to rebuild employee and investor trust was clearly at the heart of an internal memo issued by Barclays chief executive Antony Jenkins in January. The memo, sent to Barclays staff, said: “There is no doubt that 2012 was a diffi cult year for Barclays and the entire banking sector. Again, fi nancial institutions found themselves too often in the news for the wrong reasons. This damaged trust in banks, which was at a low ebb, and overshadowed the excellent and valued work you do.”

PPI mis-sellingBarclays is one of several UK banks involved in the ongoing payment protection insurance mis-selling furore and was also fi ned £290 million last June in connection with the Libor interest rate rigging scandal.

Jenkins, who took the helm at Barclays in August 2012, sent the memo to communicate to staff the bank’s new Purpose and Values blueprint, which identifi es fi ve key values and behaviours: respect, integrity, service, excellence and stewardship, on which he expects all Barclays business to be based. His message was clear: there is no future for employees who cannot uphold these values.

Clear goals are essential for any relationship based on trust, whether it is a case of building or rebuilding that trust, and HR and reward professionals can help their organisations achieve these aims.

Michael Lewis, professor of operations and supply management and head of the information, decisions and operations group at Bath School of Management, says: “The way you move forward is having clear goals and expectations. It’s like having a reconciliation process pre-divorce [and asking]: ‘what do we want to achieve together?’ and being very formal about clarity of goals, timelines and who does what and when. If [employers] think about that, then that’s the contract.”

Employers need to learn how to manage the expectations of both providers and employees as part of this goal-setting process.

Claire McCartney, resourcing and talent planning adviser at the Chartered Institute of Source:Source: Kenexa High Performance Institute

THE EFFECT OF PAY FAIRNESS ON TRUST

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TRUST IN DIRECT MANAGER TRUST IN SENIOR LEADERS

EB_0813 21EB_0813 21 19/07/2013 15:5719/07/2013 15:57

EB_0813 22EB_0813 22 22/07/2013 15:0222/07/2013 15:02

COVER STORY


[for employers] to do is to meet with the supplier, and don’t just meet with the sales people. Then, when the salesman is doing the sales pitch, [employers should] watch the body language of the operations person because they’ll wince every time the sales person over-promises something.”

Under-performing third-party provider relationships can have catastrophic consequences, and those with employee benefi ts providers are no exception. Consider the payroll provider that fails to pay staff on time, or the healthcare provider that fails to properly manage a rehabilitation programme for an employee on long-term sick leave.

Encouraging the right corporate behaviour can help to avoid such disasters. For example, creating a value proposition such as Barclays’ can help communicate to employees the behaviour that is expected of them when dealing with third-party providers.

For example, how and when should an HR or reward professional cultivate a relationship with the account manager assigned to them by one of their employee benefi ts providers? How transparent should they be with these providers about their organisation, and what is

the protocol for dealing with any service standard-related issues?

That said, the behaviour expected between employees and an organisation may need more careful attention. Cranfi eld’s Wilding says: “It’s not uncommon that [employers] will fi nd that [employees] will actually act worse with their colleagues than they do with suppliers. It’s a bit like a dysfunctional family.

“In other words, they put a nice smile on for their suppliers and their customers and are extremely good at working with them and accommodating them, and very good at managing win-win relationships, but internally, between the functions, it can be very dysfunctional in terms of what is going on.”

Ethical behaviourExecutives have the power to drive good, ethical behaviour down through their organisation with the help of their line managers. The CIPD’s McCartney says organisations should have trust role models at different levels of an organisation and multiple trust-based relationships, so they can compensate for each other if one of these relationships breaks down.

“It’s about [employers] having adult relationships with employees [and] having dialogue around diffi cult issues,” she says. “For example, in diffi cult economic climates, where employers have to make redundancies, key issues need to be addressed with no spin. Employees don’t want spin, they want the truth of the situation and that may involve giving them lots of information around how the

Viewpoint

Emma Scott is representation manager at The Chartered Institute of Purchasing and Supply

The recent scandal that saw horsemeat detected in a range of products claiming to contain beef has made the food industry begin to wonder whether it can trust some of its suppliers.

Tesco reported a loss in sales in the three months following the scandal, which caused its share price to drop by 5%, demonstrating the impact of supplier relationships on organisations’ reputation.

Of course, supplier relationships vary between employers. Some are purely transactional, but those that have the greatest impact are nurtured and built on trust and transparency, so here are a few basic rules for employers to follow.

Firstly, select the right supplier, which means working with a business that can deliver products and services an employer needs that match its culture and values.

All organisations want the best possible deal, but employers should also consider what really constitutes ‘fair’. Perhaps some of the unscrupulous suppliers that brought horsemeat into supermarkets’ supply chains would not have felt the need to do so if they were making a healthy enough profi t margin on the meat they were asked to produce.

Employers can also build trust by being open and honest about their business. They should, if possible, share business plans, forecasts and customer feedback with their suppliers to help them better understand the business and deliver what the employer wants and needs.

Finally, employers should endeavour to build bridges with their suppliers to make it easy for them to share information, good or bad. An employer is far better positioned to resolve an issue if it is fl agged by a supplier as early as possible.

But, ultimately, a trust-based relationship should involve employers treating their suppliers as an extension of their own organisation and making them feel part of their team, which will enable both parties to reap the rewards.

C3 BEHAVIOUR: ESSENTIAL FOR SUPPLY CHAIN SUCCESS

Source: Professor Richard Wilding, Cranfi eld School of Management

Co-operation Co-ordination

Collaboration

C3

�Those who believe they are paid fairly tend to have a higher level of trust in their leaders”Oliver Auty, Kenexa

EB_0813 23EB_0813 23 19/07/2013 15:5719/07/2013 15:57

COVER STORY


organisation is performing, and giving them a say, so they have a voice in the organisation.”

But employers should fi rst examine the fairness of their current corporate behaviour and practices before embarking on such transparency, in view of the fact that fairness is critical for employers that want to build engaging, trust-based relationships with employees. Pay is a case in point.

Research by the Kenexa High Performance Institute, Perception is reality: the importance of pay fairness to employees and organizations, published in 2012, shows that staff who believe they are paid fairly are nearly twice as engaged as those who do not (see graph, page 21).

Oliver Auty, Europe, Middle East and Africa regional sales director, compensation, competencies and skills manager at Kenexa, says: “Belief in pay fairness contributes to overall trust in managers and leaders. Those who believe they are paid fairly tend to have a higher level of trust in their leaders.

“This indicates that organisations should take care not only in setting competitive and equitable pay rates, but also in helping managers and employees to understand how and why the organisation chooses a particular approach to compensation.”

Duncan Brown, performance, reward and talent principal at Aon Hewitt Consulting, adds: “We need to be more open about how rewards are determined and what they are, with hugely improved reward communications in many

@ Read also How transparent are benefi ts charging structures? at: bit.ly/16oDgjh

> Organisational trust is based on co-operation, co-ordination and collaboration.

> Employers should be realistic about their

employment proposition to employees.

> Service-level agreements are not the only way to build trust with benefi ts providers.

IF YOU READ NOTHING ELSE, READ THIS. . .

employers. Practising what they preach on values and reward principles is essential.”

Barclays’ Jenkins, like a number of chief executives, this year waived his annual bonus in light of the bank’s ‘diffi cult year’, with many organisations having also frozen executive pay. In addition, Jenkins restructured the bank’s bonus criteria in October 2012, linking bonuses

to customer satisfaction, rather than sales.There are, of course, critics who dismiss the

concept of organisational trust as woolly and meaningless, but the numbers relating to the impact of organisations that are addressing the concept speak for themselves.

Take Barclays: the bank’s share price leapt from 179.90p in August 2012, when Jenkins started as chief executive offi cer, to 317.05p at the end of July. Only an HR professional in the wrong career would not want to present such numbers at their next board meeting EB

BARCLAYS’ NEW PURPOSE AND VALUES BLUEPRINT

Source: Cloud created by Employee Benefi ts from Barclays Purpose and Values, February 2013

@ www.employeebenefi ts.co.uk/benefi ts/pay-/-bonus-and-reward

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EB_0813 26 12/07/2013 16:32

HEALTH AND WELLBEING


Health and wellbeing initiatives need a long-term focus to succeed properly, says Tynan Barton

KEEP ON RUNNING

T he 2012 Olympic and Paralympic Games may seem like a distant memory now, but many employers used last year’s events to launch health and wellbeing schemes and

raise staff awareness of healthy lifestyles.But can initiatives that are short-term, or

focused on a one-off event, have a long-lasting effect on health and wellbeing?

One way of ensuring a health programme has a long-lasting effect on employees is through regular communication. Wayne Campbell, managing director of Healthy

Performance, says: “The important thing about a healthy culture at work is making it a regular communication. It doesn’t have to be something where [the employer] invests thousands of pounds. It could simply be, when it’s a health awareness week, for example, [using] some materials from a relevant charity. If it’s a regular thing, lots of employees will buy into it because it becomes the norm.”

Many employers use annual national health events to promote healthy initiatives, such as No Smoking Day in March, or National Heart Month in February. The HR index, published by

Viewpoint

Dr Serena McCluskey is senior research fellow, Centre for Health and Social Care Research, University of Huddersfi eld

There is good empirical evidence that a biopsychosocial intervention, delivered in the workplace, is fundamental in tackling obstacles to work participation. The biopsychosocial approach emphasises the infl uence of individual beliefs, attitudes and behaviours, and work environment factors, for example organisational policies, practices and workplace culture, on health and wellbeing.

Specifi cally, it has been shown that for many common disorders, vocational rehabilitation comprising healthcare alone has little impact on occupational outcomes; signifi cant input from the workplace and appropriate workplace accommodations is required, according to Vocational rehabilitation: what works, for whom, and when?, (G Waddell, AK Burton, NAS Kendall, published 2008).

While there is an assumption that such principles will apply to all workers, there is a dearth of evidence on outcomes later in the life course.

Supporting the continued work participation of older workers is crucial in light of the increasing age of the working population. The expectations being factored into pension reviews and legislation mean that people will continue working to older ages, but recent evidence by the Health and Safety Executive suggests ill-health has a major impact on the work ability of older workers.

It has been recognised that line managers are probably best placed to provide the necessary workplace accommodations, according to Dame Carol Black’s Review of the health of Britain’s working-age population (2008), but not well equipped to interpret and apply biopsychosocial principles.

Educating and enabling line managers to adopt this approach may be key in reducing the costs incurred by the employer, society and the individual associated with prolonged sickness absence and premature retirement.

> Short-term initiatives can help to lay the foundations for a long-term change in employee health and wellbeing.

> Behaviours, such as healthy eating or

exercise, must be repeated regularly if they are to become a habit.

> Regular communication about healthy initiatives can encourage a healthy culture.


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EB_0813 27EB_0813 27 22/07/2013 16:4122/07/2013 16:41

HEALTH AND WELLBEING


@ www.employeebenefi ts.co.uk/benefi ts/healthcare-and-wellbeing

CASE STUDY ASTELLAS

Meeting the challenge Pharmaceutical fi rm Astellas offers its staff a long-term programme to improve their activity and stress levels, weight and motivation. Since 2010, the organisation has taken part in the Global Corporate Challenge (GCC) wellbeing initiative, which measures participants’ daily activity levels through the number of steps they take, promoting a goal of 10,000 steps a day.

From 2010 to 2013, the number of Astellas employees that took part in the GCC has risen from 245 to 1,365, almost a third of its 4,500 workforce across Europe, the Middle East and Africa.

Rachel Collier, HR programme manager at Astellas, says: “This is one of our key initiatives for employee wellness. It’s quite fun and a collaborative and competitive way of encouraging wellness. It fi ts in well with the other things we do.”

Astellas’ UK headquarters gives staff the opportunity to join a bikes-for-work scheme, walking and running clubs, and take part in netball, football and tennis using its onsite sports pitches.

The statistics Astellas receives from the GCC show the programme’s effect on employees’ health: pre-GCC, in 2012, 35% of its staff said they were inactive, taking fewer than 5,000 steps a day, but post-GCC, this fi gure went down to 9.4%. Highly active employees, who take more than 12,500 steps a day, made up only 7.1% of the workforce before the event, but afterwards they reached 50%.

Steve Hoblyn, senior director, employee engagement and HR effectiveness at Astellas, says: “As a pharma company, our raison d’être is to improve the lives of patients, but from an HR perspective, we need to bring that internally and improve the lives of our employees.”

@ Read also Health benefi ts on a limited budget at: bit.ly/1bWxlSm

business information fi rm Pearlfi nders in July 2013, found some employers invested in health and wellbeing during the fi rst half of 2012 (pre-Olympics) and have maintained that level of investment in 2013, but such investment has declined in some sectors [see table above].

Anthony Cooper, managing director of Pearlfi nders, says: “We started tracking this in the build-up to the Olympics, and looked at what employers were doing with health and wellbeing, and if they were trying to ‘live the Games’ through the organisation. The positive thing is that the majority of sectors across the board are maintaining what they did last year.”

But can a health and wellbeing initiative establish a change in behaviour or attitude among employees? If, as Campbell suggests, an employer is communicating regularly about healthy living, and the opportunities are there, it may be easy for employees to form a habit of regular exercise or eating healthily, for example.

Dr Benjamin Gardner, lecturer in health psychology at the Health Behaviour Research Centre, University College London (UCL), says: “A lot of people work in the same place, go in at the same time each day, sit in the same seat, and so much of their context is stable. As long as they’re interested, the workplace is a good place to get new habits up and running.”

Many health initiatives can help to support

and establish a change in employee behaviours over a number of weeks. Jill King, Europe, the Middle East and Africa (EMEA) director at the Global Corporate Challenge (GCC), says that although the GCC workplace wellness programme runs for 16 weeks, staff from participating organisations have access to support and initiatives for the entire year.

“It’s really about challenging people’s perceptions of getting active,” she says. “It’s not that we’re asking people to go to the gym for 16 weeks, because that’s not sustainable; we’re encouraging people to incorporate exercise into their everyday life.”

Helping employees to change to healthier habits does not necessarily have to involve a long-term commitment from an employer, but it should take on a supportive role. Gardner says that although the UCL study suggests interventions need to be quite intensive and supportive of staff in the early stages, it should create a long-lasting change. “The intervention itself might only be short-term, but hopefully it will have long-term effects because you’ve tried to promote habits rather than just the change in behaviour,” he says EB

Source: Pearlfi nders HR Index, July 2013

INVESTMENT IN HEALTH AND WELLBEING: COMPARISON BETWEEN FIRST HALF OF 2012 AND FIRST HALF OF 2013

Sector 2012 (%) 2013 (%) Change (%)

Media 33.3 76.5 43.1

Telecoms 40 54.5 14.5

Homeware/electricals 30.4 44.4 14

Prof/Business services 36.2 44.5 8.4

Financial services 37 43.9 6.9

Public sector 33.3 40 6.7

Utility/Fuel 37.5 41.4 3.9

IT 44.1 47.4 3.3

Industry/Manufacturing 46.9 49.6 2.7

Retail 37.6 35.7 -1.9

Leisure 43.8 40.8 -2.9

Pharma/Healthcare 38.9 34.6 -4.3

FMCG 45.6 35.2 -10.3

Travel/Transport 46.4 30.6 -15.9

Motor 48.1 26.7 -21.5

Property 56.3 34.6 -21.6

TOTAL 41.5 41.9 0.4

EB_0813 28EB_0813 28 22/07/2013 16:4122/07/2013 16:41

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EB_0813 29EB_0813 29 16/07/2013 13:0516/07/2013 13:05

EB_0813 30EB_0813 30 04/07/2013 10:1704/07/2013 10:17

PENSIONS


W ith auto-enrolment under way and defi ned contribution (DC) pensions continuing to replace fi nal salary schemes, it is more important than ever for

employers to review their default investment funds to ensure they are fi t for purpose.

David Harris, managing director at TOR Financial Consulting, says: “Large numbers of employees are suddenly joining pension schemes and employers are realising that they are not making active selections. Only 10-15% of people in DC plans are active investment selectors; the rest are in the default fund.”

The Employee Benefi ts/Booz & Co Default funds survey, which polled 225 employers and was published in February 2013, found 67% of trust-based and 42% of contract-based plans review their default funds at least once a year.

Tim Banks, director of DC sales and client relations at Alliance Bernstein, says: “For each governance meeting, a review of the default strategy should take place, with best practice being a formal annual review.”

Investment objectivesThe Pensions Regulator suggests default funds should be reviewed every three years. Mel Duffi eld, head of research at the National Association of Pension Funds, says: “That review should look at the investment objectives, the performance, suitability for the membership, and charges.”

The frequency of a default fund review depends on how the employer has structured the governance of its pension scheme. Banks says: “A traditional lifestyle strategy usually means nobody is proactively managing that strategy on members’ behalf, so there is a greater onus on the governance committee to keep the default fresh through time.”

Before making any fundamental decisions about the default fund, it is important to determine its objectives. “We defi ne objectives

Default investment funds need regular reviews to keep them fi t for purpose, says Jennifer Paterson

TAKE STOCK OF OPTIONS

> Default funds should be reviewed about once a year.

> Reviews should start by looking at the profi le of the membership and the objectives of the fund.

> Employers should also examine the market to see what types of investment fund are available.


@ Read also How to choose the best default fund at: bit.ly/16LkNJP

@ www.employeebenefi ts.co.uk/benefi ts/pensions

by looking at the risk capacity for individuals against targeted outcomes,” says Banks. “Once you look at those issues in depth, you can get a good sense of the risk capacity for members, the tolerance for loss, what is added value, and then you can move to the next stage.”

After determining the objectives, employers should look at the profi le of their membership, including earnings, appetite for risk and existing pension provision. This might involve focus groups to represent the workforce. Harris adds: “You want to have a cross-section, rather than more senior management or more employees from the factory fl oor.”

The next step is to look at the types of fund available on the market. Duffi eld says: “There is a lot of interest in things like diversifi ed growth funds at the moment, so it’s about a trade-off between the amount of investment sophistication and the charges the trustee board or employer has the appetite to pay.”

Harris adds: “Employers have to consider what is the ideal model for them. This could come out of advice from an adviser or

consultant, or from their internal resources. Once they have decided on the type of fund, they need to think about the underlying investments and the selection process.”

The fi nal stage in a review is to engage the members, particularly when a change is being made, because it could be hard to explain why a different fund is more appropriate. Duffi eld says: “A lot of employers have said: ‘We’ve stripped out volatility, we’ve delivered it for the same charge or a lower charge, so we think we’ve delivered a better deal for you’.”

Employers should conduct a default fund review step by step, determining the fund’s core objectives, the membership profi le, what is on offer in the industry and the fund’s design.

Banks adds: “Think about what you want to achieve up front, rather than jumping straight into design. That audit trail gives you the ability to have reviews as a continual dynamic.” EB

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EB_0813 31EB_0813 31 19/07/2013 16:3619/07/2013 16:36

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EB_0813 32EB_0813 32 22/07/2013 15:0622/07/2013 15:06


PENSIONS

T here is no way to sugar the pill: auto-enrolment compliance presents a signifi cant fi nancial burden for employers. It

is an enormous project and there are many underlying costs.

To fully understand the costs, employers should fi rst carry out a cost-impact assessment. Mark Wilson, head of employee benefi ts at RSM Tenon, says: “We would put payroll data through our system and then, depending on a number of options and assumptions, come up with a range of costs an employer might be looking at.”

The most obvious extra cost is the gradual rise in contributions as levels ramp up until 2018. Dale Critchley, technical reforms manager at Friends Life, says: “It could be gradual or ‘big bang’: employers can start with 2% and increase it to 5% from 2017, and then 8% from 2018. But it goes to what they want to achieve. The cheapest is not always the best value.”

For instance, a minimum employer contribution of 1% may just be an added cost rather than an opportunity to add value. Employers should project the cost of increased contributions to see what they can afford. Critchley adds: “There are modellers, and we certainly have them, that show what the cost of the increased contributions is likely to be. It

The cost of complying with auto-enrolment may be much more than employers think, so they need a full assessment of its impact, says Jennifer Paterson

SHARING THE COST

allows employers to put in current salary data, number of employees and likely opt-out rate.”

Administration has been highlighted as a key challenge since auto-enrolment began. Costs here can include the use of an external hub, merging payroll and pension providers, keeping records of opt-in and opt-out rates, or switching providers. Critchley says: “It may be painful to move the pension scheme now, but it will only become more painful if the number of

employees increases post-auto-enrolment. What may seem like a big job now can only get bigger. While employers are looking at the pension scheme, they might want to consider if this is the right pension scheme for the next fi ve, 10 or 15 years.”

Clare Abrahams, head of auto-enrolment at Lorica Employee Benefi ts, says: “Most providers offer an external hub free of charge, but that depends on whether an employer is using several different pension schemes. It’s about fi guring out what processes can be put in place and whether additional resources are needed.”

Hiring new staffThere is also the added cost of these extra resources, such as hiring new staff to manage the long-term administration process. Iain Chadwick, consultancy director at Johnson Fleming, says: “Where

there is a need to check data and do the verifi cation, all that is going to require people. The system still needs to be operated by somebody. There is still a signifi cant people resource needed to manage that interface and make sure everything is correct.”

To ensure value for money in the costs of auto-enrolment, employers need to educate and communicate with employees about the legislative requirements. Abrahams says: “If employers concentrate on enhancing members’ fi nancial education and making them aware of exactly what they’re getting in the pension scheme, that could work out a lot cheaper than actually giving them a salary increase. It is all about appreciation.”

A number of options are available to manage the costs of auto-enrolment. For instance, many employers are choosing to postpone auto-enrolment by up to three months to save

> Employers should complete a cost-impact assessment to determine likely costs.

> With increasing contributions, ongoing administration and penalties for non-compliance, employers should be prepared

for short-term and long-term costs.

> An investment is being made, so employers should make sure there is value in that investment by communicating with, and educating, employees.


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hael

Kirk

ham

EB_0813 33EB_0813 33 22/07/2013 15:1322/07/2013 15:13


PENSIONS

Viewpoint

Rachel Brougham is a principal, DC consultant and UK leader for auto-enrolment at Mercer

It is easy for employers to think the cost of auto-enrolment is simply the additional pension contributions, and this in itself is quite straightforward to calculate, as long as salary data is available and the scheme design known. If these are not available, employers will start to incur costs in cleaning up their data and deciding what contributions to pay. But auto-enrolment is not just a pensions problem.

For example, Whitbread reported having spent £1 million on implementation alone. Of course, Whitbread is a large employer, but the challenges it had in implementing auto-enrolment will be similar for all employers, albeit on a different scale.

Decisions need to be made within an organisation, and the complexity of auto-enrolment will require management time and effort, with specialist technical support. This can either be bought through an adviser or resourced directly from within the organisation.

Pension provider selection will require specialist advice and time commitment. The services offered by a pension provider will have knock-on implications for payroll and HR systems, which will need to be reconfi gured to deliver correct data in the right format. Not all systems will deliver all the data providers require and not all providers will offer workforce assessment services. Employers may need to look to payroll providers for solutions or to bring in a system from a third party.

Finally, communication on the scale and detail required for auto-enrolment is unprecedented in the world of pensions. Most providers will do some of what is required but not necessarily all, so the employer must consider, and pay for, not only the creation of the relevant material, but also the cost of its distribution.

The total cost of auto-enrolment will include advice, provider costs and maybe procurement, and will require major time commitment internally to implement it in a compliant and successful manner.

@ Read also Expert tips on surviving pension auto-enrolment at: bit.ly/Tsiwzu

all about the return on investment employers get for the costs they’ve incurred. They need to be careful they don’t avoid lots of costs but then get no benefi t for what may be thousands of pounds of employer contributions spread over the next 30 or 40 years.” EB

on contributions. Another common choice is to provide tiered pension options, so auto-enrolled employees go into a minimum contribution scheme rather than an existing, higher contribution scheme.

Wilson says: “There are ways to do as little as possible, but this can also end up with a reasonable bill if [employers] have not been signifi cantly involved in pensions before. [They] may have a low pensions take-up and relatively low contribution levels, and then have to increase them to comply with the legislation.”

Salary sacrifi ceAnother option is to introduce a salary sacrifi ce arrangement. Abrahams adds: “The savings involved with salary sacrifi ce can really cut down costs. If [an employer] pays 1% extra on someone’s salary, compare that with if they increased pension contributions by 1%. Because of national insurance, that can be a much more effi cient route.”

Employers can also turn the spotlight on other parts of their benefi ts package to see if costs can be saved. Wilson says: “Are employers getting the type of investment in relation to the suite of benefi ts, or is there a way to design something that could offset the costs?”

The main focus of auto-enrolment so far has been the lead-up to an employer’s staging date, but it is important to remember that there are initial costs and then ongoing, long-term costs. Chadwick says: “We hear a lot of stories about costs that people weren’t expecting. It is only when they get to the detail that they realise it isn’t as straightforward as it looks.”

Wilson adds: “There is an ongoing set of requirements, whether that’s additional payroll or governance costs. There is also an ongoing need to comply. The other extra cost is fi nes. The escalating penalties are incredibly high.”

Ultimately, there is no sense in undertaking this huge project without ensuring there is some value to the business. Critchley says: “It is

Source: Employee Benefi ts/Capita Pensions Research 2013, published July 2013

HOW MUCH EMPLOYERS EXPECT THEIR PENSION COSTS TO INCREASE ONCE AUTO-ENROLMENT IS IMPLEMENTED

1-9% 22%

10-19% 15%

20-29% 11%

30-39% 8%

40-49% 3%

50-59% 4%

60-69% 1

70-79% 1

80-89% 0%

90-100% 3%

No expected change 11%

We have not calculated this

21%

3%

HOW EMPLOYERS WILL BE ABLE TO AFFORD THE CONTRIBUTIONS FOR AUTO-ENROLMENT COMPLIANCE

42% 21%

of respondents said they would have to pay for pension contributions out of their own profi ts.

said they would have to freeze or cut salaries to fi nd the money.

said they would be forced to make redundancies.

Research published by the Institute of Directors in May 2013

@ www.employeebenefi ts.co.uk/benefi ts/pensions

EB_0813 34EB_0813 34 22/07/2013 15:1322/07/2013 15:13

EB_0813 35EB_0813 35 22/07/2013 14:2622/07/2013 14:26

FLEXIBLE BENEFITS


W hether through water use, air pollution, waste or greenhouse gas emissions, the carbon footprint we are all treading onto the planet is signifi cant.

But from 1 October 2013, the Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 will require, for the fi rst time, that all UK-quoted companies report their greenhouse gas emissions in their annual

HOW GREEN IS

accounts, plus what actions they plan to take to reduce their carbon footprint. The Department for Environment, Food and Rural Affairs has estimated this reporting could contribute to four million tonnes of carbon dioxide (CO2) emissions being saved by 2021.

Most employers have a dedicated corporate social responsibility (CSR) policy, which includes how the business aims to lessen its impact on the environment. But what does this

mean for staff? Graham Simmonds, managing director and co-founder of Green Rewards, says: “Employers need to align this to a wider approach, such as committing to an environmental strategy, whether through commitments around carbon reductions or supporting the communities they operate in.”

Alastair Denton, managing director of employee benefi ts at Edenred, adds: “Employers need to put together a holistic proposition rather than just tacking on things that look green for green’s sake.”

Employers can also refl ect aspects of their CSR policy in a fl exible benefi ts scheme, offering perks that fi t a green or sustainable focus. This is an ideal place to include these benefi ts, because it offers employees a choice around how they support the environment. Richard Stewart, director of Mazars Employee Benefi ts, says: “There are environmental opportunities through these schemes, but

> In October 2013, UK-quoted companies will have to report their greenhouse gas emissions in their annual accounts.

> Sustainable and green benefi ts include bikes-for-work schemes, low-emission company cars, environmental pension

investments and opportunities to eco-volunteer.

> These perks, as part of a fl exible benefi ts scheme, should also be aligned with the organisation’s corporate social responsibility strategy.


YOUR VALLEY?

EB_0813 36EB_0813 36 19/07/2013 17:4819/07/2013 17:48

Four million

tonnes of CO2

emissions could be saved by 2021 through UK-quoted companies

reporting their greenhouse gas

emissions


@ www.employeebenefi ts.co.uk/benefi ts/fl exible-benefi ts

CASE STUDY ACCENTURE

Perks foster sustainable growthAccenture UK and Ireland offers its employees a range of green benefi ts through its fl exible benefi ts scheme, including a bikes-for-work scheme, a recognition programme provided by Green Rewards, free home energy audits and a volunteering allowance for eco-volunteering activities.

Camilla Drejer, corporate citizenship lead for Accenture UK and Ireland, says these benefi ts are tied in with ensuring the sustainable growth of the business.

“Fostering sustainable growth for our organisation and our stakeholders is at the heart of our environmental strategy,” she says. “As a people-based business, all this is underpinned by how we engage our staff and support them in taking action to reduce their personal and business environmental footprint.”

The energy audit is part of a pilot project called Green My Home, in which 50 Accenture staff have signed up for free home energy assessments. Another way for employees to increase sustainability is to claim 12p per mile each time they cycle to business meetings. The Green Rewards programme gives staff recognition points to spend on sustainable products and services.

Accenture employees are also allowed up to three days’ paid leave each year to

volunteer in their local communities. Drejer says: “Eco-volunteering covers a range of activities, from conservation work and tree-planting through to sharing business skills with young people looking for careers in the green sector or helping our sustainability charities develop their organisational framework.”

The organisation also offers staff free membership of its Environmental Action Group (EAG), which aims to increase sustainability

awareness and support the implementation of more eco-smart work practices.

“We connect with our members through a monthly call, an online Yammer group, and postcards and newsletters,” says Drejer. “The EAG consists of more than 400 employees from across the UK and Ireland.”

decide the earning rate of green points. For instance, if an employer wanted to reward employees who cycle into work, we would help them to work out roughly how many employees do that, how many miles would be cycled per year and how many points to give

typically it is left to the employees. It is more about the choice.”

Bikes-for-work schemes, for instance, might appeal to a small percentage of staff, but they cover both environmental and health issues. Stewart adds: “Employers offer choice because they have to allow people to do something that suits their circumstances. It might not be that everyone wants to, or can, cycle to work. But for people who value it, they can do it, while others can do other things. That’s one of the fundamental aspects of fl exible benefi ts plans.”

Recognition programmeAn environmental focus can also be included in a recognition programme. For example, employers can reward staff with a points-based currency from provider Green Rewards, which can then be reimbursed at an online green shop or donated to a local community or charity project.

Simmonds says: “It is up to the employer to

out per mile, based on their available budget.”Employers should also consider the

environmental impact of company car schemes, particularly because tax savings are driven by emissions. Cars with higher CO2 emissions incur a higher percentage of tax. Stewart adds: “A lot of employers are introducing car schemes that impose limits or steer people towards low-emission cars.

“At Mazars, we could have put a CO2 limit on the car scheme, but we felt that we ought to give employees choice. [HM Revenue and Customs] will penalise people who don’t go for cars that are low on emissions, so there should be an element of self-policing.”

Socially responsible pension scheme investments, such as ethical or environmental funds, are also becoming popular with employers, but mainly as a voluntary fund. Stewart says: “Socially responsible investing is more of an option that is offered to people

EB_0813 37EB_0813 37 19/07/2013 17:4819/07/2013 17:48

FLEXIBLE BENEFITS


Viewpoint

Tim Roberts is managing director at Good Measures

HR’s sustainability role is intricate. Firstly, sustainability begins at home, so organisations must ensure they manage staff sustainably. Employee wellbeing, health and safety, work-life balance, inclusion, talent management, fair total reward, employee development, positive and open dialogue, and staff involvement in-house and out, are all vital. We all know they interlink to deliver a high-performing, engaged, healthy and wealthy workforce.

Secondly, look at cost-effectiveness and governance. Leading green employers recognise that sustainable business is good business. It’s all about effi ciency and cost-effectiveness, not public relations. Are employers sure their total rewards optimise cost-effectiveness and return on investment, with key components supplied by reputable partners? The trend is to look at the true environmental and reputational cost, as well as the social contribution of individual business activities. We should adopt this approach, too.

Recently, we highlighted the impact of reduced investment returns and robust infl ation on pensions. Secure, affordable pensions depend on a clear investment return gap. The challenges here arise from the long timeframes and strong correlations in carbon, climate, resource and investment management and pensions. This calls for a radical rethink of saving-at-work incentivisation with far more lenient taxation, not penalisation.

Thirdly, integrated programmes will lead to an improved understanding of global climate and resource scarcity challenges. Simple workplace actions often achieve the greatest change, such as Center Parcs rewarding employees’ home energy savings to reinforce how vital corporate energy effi ciency is. Sustainable HR and rewards add up for the individual. Helping employees reduce their commuting, business travel, home energy and water costs today will add up tomorrow at individual and corporate level.

rather than it being the default.”Another way to offer employees choice

around their environmental spotlight is to include a carbon-offsetting scheme in a fl exible benefi ts package. Environmental charity Pure the Clean Planet Trust’s scheme allows staff to enter their gas and electricity usage, as well as their travel, into an online calculator.

Robert Rabinowitz, chief executive at Pure the Clean Planet Trust, says: “It tells you what your footprint is and you can choose how much you want to offset. We then take the money and look for a project to support.”

Payroll givingEmployees can also choose to share the cost of their carbon footprint with charities, often through a payroll-giving scheme. Stewart says: “Through payroll giving, employers can give staff access to an open range of charities or, in some cases, run with a charity that is involved entirely in the environmental space.”

@ Read also Top tips for greening your fl eet at: bit.ly/1ax7TBa

Ultimately, if an employer chooses to include green or sustainable perks in a fl exible benefi ts scheme, it should also ensure that this is aligned with an overall CSR policy.

Edenred’s Denton calls this practising what you preach. “At Edenred, we believe we should minimise our impact on the environment,” he explains. “We invest time in this as a business, so when we talk about it to others, we are really walking the walk as well as talking the talk.”

Rabinowitz adds: “If an employer can make its employees aware of what their carbon footprint is and how they can reduce it, that’s going to support the organisation’s efforts in reducing its own corporate footprint. If this is part of a broader CSR strategy, that’s how you would get the most traction.” EB

CASE STUDY WITHERS

Green benefi ts raise CSR profi leLaw fi rm Withers has been working to raise its corporate social responsibility (CSR) profi le alongside the green benefi ts it offers to staff.

When it launched its fl exible benefi ts scheme in April 2013, it included a section called Ethics and Sustainability, which is the entry point into its payroll-giving, bikes-for-work and carbon-offsetting schemes.

The carbon-offsetting benefi t, provided by Pure the Clean Planet Trust, allows staff to enter the details of their carbon footprint online and determine an amount they can pay to offset it. Sharon Tebb, compensation and benefi ts manager at Withers, says: “It makes you feel OK about fl ying and all the other things you do.”

Sustainability’s fi t with CSR is part of the law fi rm’s culture. Tebb adds: “People

often ask about our CSR policy at interview. That’s why we are trying to offer more of these types of benefi ts.”

However, such benefi ts might not suit all employees, which is why they sit well in a fl ex scheme. “It doesn’t matter if you don’t get 50 people doing it,” says Tebb. “It’s all about choice.”

Tebb’s other hat at Withers is as CSR manager and she has helped to shape the programme over the past year. “We didn’t really have any real programme,” she adds. “We did a lot, but there was no formalised programme. I’m always looking for ways in one hat to improve the other hat.”

EB_0813 38EB_0813 38 19/07/2013 17:4819/07/2013 17:48

INDUSTRY FORUM

As the climate of economic austerity continues, employers should take steps to ensure they get

the most from their reward and benefi ts spend, says Andrew Woolnough

Reward has to boost employee engagement

Supplied by:

Aon Hewitt’s latest Trends in global employee engagement report, published in May 2013, revealed that pay, the extent to which employees believe they are fairly paid for their contribution to an organisation’s performance, is the third most important driver of employee engagement.

In traditional engagement research, pay is often thought of as a hygiene factor. This means employers have to get pay right, but incremental investments do not have a signifi cant impact. However, this shift in the importance of pay, up from sixth place in 2011, indicates that it is now more important to employee engagement than it has been in the recent past.

This fi nding could result from a number of developments. Firstly, it could mean ongoing pay and bonus constraints are starting to affect the extent to which employees are prepared to stay and strive for their organisation. Secondly, traditional retirement security is either gone or at risk, and pay may be considered more important as a consequence.

Also, the employee psychological contract may be changing and staff with less long-term loyalty will value pay more. Thirdly, two of the three regions where pay is a top driver, Asia-Pacifi c and Latin America, are growing regions where the job market is competitive and pay remains a critical aspect of the value proposition to attract, retain and engage talent.

The medium-term risk for employers is that employees could become very mercenary as job opportunities open up for higher pay.

About 40% of staff globally think they are fairly paid for their contribution. This is a low percentage

Andrew Woolnough is client development director at Aon Hewitt

Often, the employee is not aware of the total package and the investment in them”

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and although we are unlikely to ever see high scores for this driver, there are steps organisations can take to improve staff understanding of their pay composition and how pay decisions have been made.

Recognition is often still an under-used and under-rated tool and is signifi cantly less costly than direct pay. Employees look to leaders and managers for recognition, both in terms of their performance and also acknowledgement of the organisational challenges they sometimes have to deal with in performing their jobs. One benefi t of formal and informal recognition is that it offers fl exibility in the way employers recognise individuals, for example a public thank-you, a private personalised note, or a real-time acknowledgment of a job well done, are all important to motivation and engagement.

Total packageThere is also the question of employee perception of reward and benefi ts. Often, the employee is not aware of the total package and the employer’s investment in them, which can include not just pay and benefi ts, but also training and development or softer cultural factors, such as social responsibility. Investment in effective communication can give employers more bang for their buck.

Aon Hewitt’s 2013 Benefi ts administration survey, published in July, shows 28% of organisations cite communicating the full value of reward as their top engagement priority. Benefi ts provision, particularly fl exible benefi ts, can play a vital role in enhancing benefi ts perception and employee engagement, as long as the administration and communication around the package is optimised and seen to be fair.

The survey suggests the key benefi ts challenge facing employers is obtaining a higher return from benefi ts expenditure. In an environment of tightening budgets, organisations have to be far more creative when it comes to employee engagement.


@ www.employeebenefi ts.co.uk/benefi ts/pay-/-bonus-and-reward

EB_0813 39EB_0813 39 22/07/2013 16:2922/07/2013 16:29

VOLUNTARY BENEFITS


A s new technologies advance and their capabilities increase, bring-your-own-device (BYOD) schemes have become more popular in the workplace. These enable staff to

use their own devices, such as smartphones, laptops and tablet computers, at work.

A YouGov poll of 2,151 adults, commissioned by the Information Commissioner’s Offi ce (ICO) and published in March 2013, revealed that 47% of all UK adults now use personal equipment for work purposes. But in the world of cyber infi ltration and computer viruses, concerns about BYOD schemes have been raised.

The same ICO survey found that fewer than three in 10 users of BYOD schemes had received guidance from their employer on how to use their devices appropriately, and how to comply with the Data Protection Act.

The ICO has issued guidance for employers about BYOD schemes. It recommends that an employer’s policy should cover: what type of personal data can be processed on the device, and whether and how it is stored; which documents can be accessed through a personal device, and how controls can be put in

More employees are using their own electronic devices at work, says Ian Silvera

PERSONAL

place if the device is lost or stolen.Laurent Bouchoucha, sales development

director, Europe, Middle East and Africa, at Alcatel-Lucent Enterprise, says: “There are a number of issues around BYOD. The fi rst is security and the second is about trying not to make life complex for employees. Employers need to build the security and BYOD policies fi rst, and then supply the tools.”

Cash allowanceMartha How, principal at Aon Hewitt, says BYOD schemes can be implemented in various ways, such as an employer providing staff with a cash allowance that they can use to buy a device. This is straightforward for the employees, but the cash allowance will be subject to tax.

How says a salary sacrifi ce arrangement is the best option for employers. “The smartest way to implement a BYOD scheme is to use a salary sacrifi ce plan, where an employee sources a device and pays for it via their employer,” she says. “As long as it is structured properly, it can be tax-effective.”

Another area of concern for employers is the speed at which technology can become

@ Read also Developments in benefi ts apps and modellers at: bit.ly/175NQZ9

@ www.employeebenefi ts.co.uk/benefi ts/voluntary-benefi ts

> Employers need to ensure that employees comply with the Data Protection Act when implementing a bring-your-own-device (BYOD) to work scheme.

> BYOD schemes enable employees to be fl exible, fast and productive.

> A big cultural change will be required.


obsolete. The ICO points out that data is still largely generated on PCs, but because this data is increasingly accessed on user-owned, hand-held devices with a shelf-life of one to two years, employers are having to manage that data more proactively.

With a wide array of operating systems available, the challenge of managing the higher disposal frequency of such devices can quickly stretch resources. Not only must obsolete devices have all confi dential data wiped before they are discarded, but new devices must be synchronised and brought up to par. Devices that are upgraded cyclically, for example mobile phone contracts that are renewed each year, may need reconfi guring.

Independent BYOD consultant John Laity says such schemes require a cultural change within an organisation because they involve staff supplying their own equipment for work. “It’s nothing to do with IT security, it’s to do with workfl ow,” he says. “Employers have realised you don’t necessarily need to have a piece of technology sat on an employee’s desk.”

Bouchoucha adds: “It’s a revolution. Before, IT departments were dictating what types of device could be used. But now it’s not just a couple of employees that are requesting access to their own devices; the number of employees doing so is increasing.” EB

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EB_0813 40EB_0813 40 22/07/2013 16:3322/07/2013 16:33

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EB_0813 42EB_0813 42 15/07/2013 17:1515/07/2013 17:15

MOTIVATION


P erformance development reviews (PDRs) are traditionally conducted annually between an employee and a manager to identify the employee’s progress and performance during the

year and agree goals for the following year.But PDRs can also be linked to motivation

and recognition programmes. The Chartered Institute of Personnel and Development’s (CIPD) Performance management in action survey of 507 HR professionals, published in November 2009, found that most employers use PDRs as part of their performance management programmes.

Using a PDR in this way provides a consistent way to evaluate staff and assign rewards accordingly. However, PDRs could lose favour among employers as new tools emerge to measure performance. WorldatWork’s The state of performance management survey, published in October 2010, revealed that 58% of HR managers gave their performance management process a ‘C’ grade or worse.

Martin Alden, head of B2B and partnerships at Wickes, says the main problem with PDRs is their infl exibility. “A PDR is most powerful when

Peer recognition can make employee performance reviews more relevant and dynamic, says Ian Silvera

SLICK MOVEit is used as something that you live and breathe, rather than just a paused moment in time,” he says. “What often happens with employers that don’t invest in their PDR system is that they use it as a badge of honour for employees to hang something on at the end of the year. Usually what happens is that an employer will run a PDR, and the employee will put it away in a drawer until two weeks before next year’s PDR. The employee then suddenly realises they need to achieve, in two weeks’ time, the objectives they agreed on last year.”

Regular meetingsAlden’s view is supported by the CIPD’s survey, in which 83% of respondents agreed that appraisals are a cornerstone of performance management, and 90% felt regular meetings were an integral part of performance management within an organisation.

If regular meetings or reviews are not taking place, a formal PDR can seem out of date and ineffective, creating negativity around the process. Eric Mosley, chief executive of Globoforce, says: “The main reason for this negativity is because PDRs have been around

Viewpoint

Benjamin Reid, senior researcher at The Work Foundation

Performance reviews have a long history, but largely as something that is done to employees rather than something that motivates and inspires them. For Frederick Winslow Taylor’s Scientifi c Management Approach in 1911, a performance review was something managers did between themselves to establish workers’ tasks. Even by 1957, Douglas MacGregor (he of Theory X and Y fame) was fi nding himself ‘uneasy’ at the way in which performance appraisals put managers in the position of ‘playing God’ in their judgements on staff.

Surveys suggest up to 98% of staff fi nd performance reviews unnecessary, and the Society for Human Resource Management’s Impact of people management practices on business performance survey, published in 1997, found that 90% of managers approach reviews with a sense of dread.

But it does not have to be like this. At their heart, formal performance reviews should be an honest, open conversation between colleagues. That they generally are not is largely because they are often the only occasion when managers discuss performance with employees. And because they are often linked to reward and promotion, they are more like a job interview, or, worse, a hatchet job, than a useful refl ection on performance.

Formal performance reviews will work only when they are a single, reward-linked occasion among many hundreds of regular informal honest conversations about performance, and favour the employee’s voice rather than the manager’s. Reviewing performance should be embedded in all team practice.

A key characteristic of outstanding leaders is that they excel at giving time and space to others. A culture of regular, open refl ections on performance is needed to drive engagement. This makes formal performance reviews rewarding for the individual and the organisation.

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EB_0813 43EB_0813 43 22/07/2013 15:2422/07/2013 15:24

MOTIVATION


CASE STUDY PEER 1 HOSTING

Helping staff to help themselvesPeer 1 Hosting has a traditional annual performance review cycle, but it starts each year with a process an objective-setting exercise called Peer Promises. This involves employees and managers spending time together to set their promises to deliver and be accountable for during the forthcoming year.

Helen Ives, HR director, says: “Everything that we do from a learning, recognition and performance standpoint is very collaborative and peer-to-peer led.”

The Peer Promises system focuses on employees’ ideas,

identifying what they can bring to the organisation and what goals they have over their career.

Ives adds: “We try to keep the system side of reviews as light as possible and focus on conversations. We see ourselves very much in the relationship business and to deliver a good system, we have to have good, motivated people.”

Peer 1 Hosting also runs a Team Awesome online recognition programme, in which employees can recognise each other when they are spotted ‘living’ the employer’s values.

Ives says: “That has had a

@ www.employeebenefi ts.co.uk/benefi ts/staff-motivation

@ Read also Social media plays growing role in recognition schemes at: bit.ly/RlryJe

> Employers can use peer reviews to contribute to the performance development review (PDR) process.

> New technologies give employers an opportunity to ask employees about their peers.

> A recognition scheme can easily be integrated into a PDR.


for decades and the format hasn’t changed. Also, employees generally don’t like having a review with their manager because he or she might not have seen the great work they’ve done over the year. Because some things can change rapidly over a year, an annual peer review can be outdated when it is conducted.”

Mosley says employers are moving towards crowd-sourced performance reviews to counter the rigidity of PDRs. “There’s a move towards getting more input and more data,” he says. “Employers are looking to get peers to help in the process because they are around their colleagues throughout the year. The main advantage is that peers see the great work people do throughout the year. As long as there’s some mechanism to give that feedback frequently, then it’s recorded.”

Mosley’s view is supported by the Spring

2013 Society for Human Resource Management/Globoforce Employee recognition survey, published in June, which polled 800 HR professionals. It found that 90% of respondents said feedback from an employee’s peers is more accurate than that from a supervisor or manager.

Social recognitionThe research also showed 85% of respondents are using, or would consider using, social recognition, a system that empowers employees to recognise each other’s work. Also, 78% of respondents said crowd-sourced recognition would be helpful data to incorporate into performance reviews.

Mosley adds: “Employers conduct social recognition programmes, which give peers the opportunity to give positive feedback on discretionary effort, where an employee has carried out a task which is above and beyond their job specifi cation. These programmes allow peers to nominate a colleague for an award. Over a year, that creates a catalogue of what an employee has done and it can be taken into the annual review, so an employee has some commentary from colleagues for a manager to take into consideration.

“The advantage of this is that it can be very rewarding and motivating for the employee, and they can feel that if they do great work, it will be recognised. The number one reason why employees become disengaged is because

they don’t feel recognised or appreciated.”Colin Hodgson, sales director for reward and

recognition at Edenred, adds: “Technology is allowing organisations to deliver far more from recognition programmes than ever before. It’s given employers more visibility about who is interacting with their recognition programme and, more importantly, how they’re interacting.

“Most PDRs have some kind of cultural value. For example, how do employees act against the employer’s corporate values and how do they contribute to the working environment? So there’s a correlation between recognition and appraisal because of the association with cultural values. We are seeing opportunities to start using information that’s available in the recognition programme and draw it out to contribute to the annual appraisal.”

Hodgson says this could work in practice in two ways: employees could extract data about how often they have nominated colleagues for activities associated with good behaviour. Secondly, a line manager may share that access so they can identify how many nominations an employee has received and so what that employee is contributing.

More employers may soon look to social media as a way of garnering information on staff performance EB

remarkable impact on engagement and motivation.”

This is illustrated by the fact that the organisation’s engagement score increased from 39% in 2011 to 51% in 2012.

Peer 1 Hosting is also about to introduce an online tool that will enable its employees to write

and create online training for each other.

Ives adds: “As a technology organisation, we have a lot of young, gifted people working here with a lot of knowledge and we want to make the most of that by creating a platform for peer-to-peer learning.”

EB_0813 44EB_0813 44 22/07/2013 15:2422/07/2013 15:24

EB_0813 45 12/07/2013 16:16


EMPLOYER PROFILE

H SBC is streamlining its employee benefi ts offering as part of plans to safeguard its talent during their career with the organisation and through into retirement.

The streamlining project will culminate in the delivery of a new benefi ts proposition in 2015 that will provide all employees with a suite of competitive benefi ts regardless of their role or

career band within the organisation.Maria Strid, head of performance and

reward, says: “As with any large organisation comes a degree of complexity, particularly as you grow, both through acquisition and organic growth. We want to try to make sure we have an employee benefi ts proposition that is consistent and equitable, and slightly simpler than what we have today, which would also

help and support the new organisational structure and our overall business strategy.”

Stuart Gulliver, who took over as HSBC’s group chief executive in January 2011, announced in May of that year a new business strategy with which he planned to make savings of up to $3.5 billion (£3 billion) within three years, to boost shareholder returns.

An investor update announced in May this

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HSBC’s change programme is streamlining its reward and benefi ts offering to give all employees a fair and motivating package, says Tynan Barton

BIG INVESTMENT

HSBC wants a “consistent and equitable” benefi ts proposition, says Maria Strid

EB_0813 46EB_0813 46 22/07/2013 17:0122/07/2013 17:01


HSBC AT A GLANCE

HSBC opened its fi rst branch in Hong Kong in 1865. The global banking group is named after its founder, the Hong Kong Shanghai Banking Corporation. In 1992, the UK’s Midland Bank became a wholly-owned member of the HSBC group, and in 1999 it was rebranded as HSBC.

The business employs 260,000 people worldwide, with 47,300 based in the UK, and has 6,600 offi ces around the world, in both established and emerging markets. Its network covers more than 80 countries and territories in Europe, Asia Pacifi c, the Middle East, Africa, North

America and Latin America.It serves about 58 million

customers through four global businesses: retail banking and wealth management; commercial banking; global banking and markets; and global private banking.

HSBC’s global head offi ce is in Canary Wharf, London.

CAREER HISTORY

Maria Strid, head of performance and reward, has been at HSBC for two and a half years. She joined from Santander UK, where she was head of reward and international mobility, having been at that organisation for six years.

She started her reward career at a design engineering consultancy Ove Arup and Partners.

Strid says one of her biggest career achievements has been her role in changing the status quo. “That could be from big things to small things,” she says. “It was quite an unusual period at Santander, [for example], because that was during the fi nancial crisis, so being part of a mergers and acquisitions team, and then the integration and implementation that came with that, was something quite special.”

So Strid is well-positioned to manage the changes at HSBC. “We are reshaping the benefi ts agenda, making sure it’s aligned to a new organisational structure and helping the business to operate more effi ciently from an employee point of view,” she says.

“Seeing team members develop and fl ourish is something I take great joy in. Sometimes that means they move on and do other things, but seeing somebody develop and successfully go through their reward career is special.”

year revealed that the bank, which reported a pre-tax profi t of $8.4 billion (£7.3 billion) for the fi rst quarter of 2013, almost double the $4.3 billion (£3.7 billion) it reported a year earlier, is committed to growing its business and dividends, as well as streamlining its processes

and procedures, during the next phase of its strategy between 2014 and 2016.

In preparation for streamlining its employee benefi ts, HSBC ran a consultation process with employees and staff representative bodies, including its pension trustees, from January to

April 2013. “The most high-profi le change we proposed was the pension change,” says Strid.

“Our future proposition will be a very competitive defi ned contribution (DC) pension scheme. We were very clear that this isn’t a cost-cutting exercise at all, so the premise was

EB_0813 47EB_0813 47 22/07/2013 17:0122/07/2013 17:01

EMPLOYER PROFILE


Case study

Hasintha Gunawickremasenior business performance manager

Hasintha Gunawickrema, senior business performance manager, European retail banking and wealth management, has worked at HSBC for seven years.

As a working parent with a young family, Gunawickrema values holiday days and the fl exibility she has to buy or sell holiday, depending on what her plans are for a particular year. This gives her fl exibility around managing family commitments.

She also values the bank’s

private healthcare benefi t. “It gives me so much comfort on how we can manage unforeseen health issues,” she says.

“Last summer, I had to see an ENT [ear, nose and throat] consultant urgently, when the NHS could only accommodate me after seven days.

“I was able to see an ENT consultant in less than a day using the HSBC healthcare cover. Having such amazing support from my employer makes me feel valued.”

also around reinvesting any potential annual savings into the overall proposition, and that’s what we’ve done.”

The new benefi ts strategy, which will be implemented between January and July 2015, will introduce a trust-based DC scheme with a core employer contribution of 10% on the fi rst £20,000 of salary, and then 9% on the remaining pensionable salary.

HSBC will also offer matching contributions of up to 7% and pay all the annual management

charges for the scheme, which has different sections for different groups of employees. The bank plans to close its defi ned benefi t (DB) plan to future accrual.

HSBC prides itself in its employee feedback efforts, and the benefi ts consultation process was no exception, says Strid. “The exercise is probably the greatest feedback we’ve ever had. We have genuinely listened and that has shaped the new proposition.

“Pensions is a complex process. What did

come through was that our employees wanted to understand it better, and get some help with understanding it, so one of the things we have committed to is a long-term fi nancial education programme. We will be launching that in the fourth quarter of this year.”

HSBC recognises the power of a competitive pension scheme in attracting top talent to the business. Strid says: “[The pension scheme] is a key benefi t, but also it is a fi nancial product. Taking the time, through both fi nancial education and providing a pension benefi t that is very competitive and good for our employees, is key.”

PMI for allThe bank will also introduce private medical insurance (PMI) for all its employees and their families as a core benefi t, as well as income protection at 60% of salary, which is double the current level.

In line with its aim to offer employee benefi ts that appeal to all staff, HSBC has also upgraded its fl exible benefi ts platform to a new system provided by Aon Hewitt.

The bank has also introduced single sign-on. “One of the things to make things easier for our employees as they go through the annual

EB_0813 48EB_0813 48 22/07/2013 17:0122/07/2013 17:01


@ www.employeebenefi ts.co.uk/industry-sectors

THE BENEFITS

Pension> A new, trust-based defi ned contribution arrangement. From 1 July 2015, HSBC will increase its core employer contribution from 8% to 10% for the fi rst £20,000 of employees’ pensionable salary and to 9% for any remaining pensionable salary above £20,000. It will also match any employee contributions of up to 7%.

Private medical insurance > From January 2015, all employees will be eligible for company-paid private medical insurance for themselves and their family.

Income protection> From January 2015, all employees will be eligible for employer-funded income protection of 60% of salary.

Holidays> From 2015, annual holiday entitlements will range from 25-30 days (plus public holidays), depending on global career band.

> Days can be bought and sold up to a maximum of fi ve days.

Maternity leave> From 2015, HSBC will provide 19 weeks’ paid maternity leave.

@ Read also Santander reshapes reward in quest to be the best at: bit.ly/YZrYu5

[fl exible benefi ts] elections, or things they can change every month, is single sign-on,” says Strid. “As long as they’re logged into the network at their desk, they can go straight in without any additional sign-on. That’s one of the things that makes the administration more user-friendly.”

HSBC uses multiple channels for communicating benefi ts to staff. In addition to home mailings and its intranet site, it stages benefi ts roadshows each year and uses 600 employee benefi ts champions to promote the perks on offer.

The champions are also responsible for answering colleagues’ questions ahead of the fl ex enrolment window.

The bank also uses the screen savers on employees’ computers to remind them that

the fl ex enrolment period is coming. “That is something we see,” says Strid. “Most people go into the system and make some active choices. About 70% [of staff] log in and do that.”

Strid says the change programme refl ects one of the biggest business issues facing HSBC: “We inherited a number of things through acquisition, so that would have changed the current landscape as to how things look today,” she says.

“But moving forward, we want to make sure [the programme] is fi t for the future and fi t for the organisation.”

But Strid is aware of the limitations of a benefi ts package in helping the business to retain talent, however robust it is. “It’s about creating the right culture, which means that we have an organisation that people want to join and then stay,” she says.

“It’s an easy thing sometimes for organisations to over-emphasise the rewards and benefi ts piece. It’s almost like a hygiene factor: if you get it wrong, you will have a problem, but it certainly isn’t the key thing that we would look to for people to join or stay.” EB

�It’s about creating the right culture, having an organisation that people want to join and then stay”Maria Strid, HSBC

EB_0813 49EB_0813 49 22/07/2013 17:0122/07/2013 17:01

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EB_0813 50 08/07/2013 11:14

BUYER’S GUIDE


PRODUCT FILE

@ www.employeebenefi ts.co.uk/resource-centre/buyers-guide

S alary sacrifi ce car schemes were one of the top 10 benefi ts that employers offered their

workforce through salary sacrifi ce arrangements in 2013, with 6% of employers having introduced the benefi t this year, according to Employee Benefi ts’ Benefi ts Research 2013, published in May.

Employee interest in such schemes, which involve an employee forgoing a portion of their gross salary in exchange for a car, is being driven by a growing awareness of the benefi t.

A survey by Tusker, conducted in June 2013, found that 87% of more than 500 employees polled have recommended a salary sacrifi ce car scheme to a colleague.

Schemes are attractive to employers because they typically cost the business nothing, with most providers able to manage all aspects of car maintenance, including servicing, breakdown cover and insurance, as well as ongoing communications about, for example, driver and car safety.

But complications can occur when an employee goes on long-term sick leave and cannot keep up the repayments on a car, or if an employment contract is terminated, which may result in an employer having to meet the outstanding costs of the car.

NI savingsEmployers can also benefi t from the national insurance (NI) savings made by deducting employees’ car payments from their pay, which many organisations choose to invest in their car scheme.

For staff, salary sacrifi ce car schemes are a cost-effective way to obtain a car, and not just because of the NI savings. They can also reduce the level of tax they pay by choosing a low-carbon dioxide (CO2) emission model. This is because company car tax is based on CO2 emissions as well as the P11D value of a car.

Since Chancellor George Osborne announced plans in his March 2013 Budget to introduce an ultra-low-emission company car tax, car manufacturers have

SALARY SACRIFICE CAR PLANS

What is a salary sacrifi ce car scheme?This is a car scheme for which an employee forgoes a portion of their gross salary in exchange for a car.

The schemes offer tax and national insurance breaks for employers and employees.

Where can employers get more information?More information is available from Employee Benefi ts’ website at www.employeebenefi ts.co.uk/benefi ts/company-cars-and-fl eet

And from HM Revenue and Customs at www.hmrc.gov.uk

Who are the main providers?ALD Automotive, Alphabet, Fleet Evolution, Fleet Hire, Hitachi Capital, Inchcape Fleet Solutions, Leasedrive, LeasePlan UK, Lex Autolease, Tusker, Venson Automotive Solutions, Zenith.

The facts

Company cars via salary sacrifi ce arrangements seem an attractive option, but take-up is low, says Clare Bettelley

33%of employers offer car salary sacrifi ce schemes (Alphabet fl eet management report, March 2013)

11%of employers offer cars via salary sacrifi ce on a voluntary basis (Employee Benefi ts Benefi ts Research 2013)

STATISTICS

@ Read also Salary sacrifi ce car schemes explained at: bit.ly/153KwNB

been busy designing bigger cars with low emissions, which are increasingly being offered through salary sacrifi ce schemes.

But despite the growing interest in salary sacrifi ce cars, overall take-up of the perk is low. The number of employers that offered cars through salary sacrifi ce arrangements more than doubled from 3% to 8% between 2009 and 2011 according to the Employee Benefi ts’ Benefi ts Research, but cars were only the ninth most popular benefi t offered through salary sacrifi ce in 2013, with just 11% of employers offering them on a voluntary basis and 3% through fl exible benefi ts.

Another factor deterring employers is their liability in offering company cars, including the potential threat of a corporate manslaughter charge if an employee is injured or killed while driving a company car.

Thin

ksto

ck

EB_0813 51EB_0813 51 23/07/2013 15:5023/07/2013 15:50

EB_0813 52EB_0813 52 23/07/2013 16:1423/07/2013 16:14

BUYER’S GUIDE


PRODUCT FILE

@ www.employeebenefi ts.co.uk/resource-centre/buyers-guide

A n increasing number of employers are turning to group dental plans to meet employees’ needs.

The Offi ce for National Statistics’ report Adult dental health for England, Wales and Northern Ireland 2009, published in March 2011, showed that 12% of respondents said the cost of their dental care and treatment was covered by a pre-payment plan or insurance scheme.

The British Dental Health Foundation survey Is your smile at risk?, published in May 2012, revealed that only 57% of employers allow their staff to take paid time off to visit the dentist. The same survey showed 93% of employers do not give staff occupational health information on good oral health.

The growing demand for group

dental plans is also refl ected in more recent research. The 2013 Denplan dental benefi ts survey, published in January 2013, showed that 63% of employees without a dental plan would consider one if their employer offered it.

Dental insuranceAccording to National Dental Plan (NDP), two out of three new employers it works with have not offered dental insurance before. In addition, dental benefi ts offered under private medical insurance (PMI) are one of the most claimed employee benefi ts, with 97.5% of NDP’s members making use of the insurance plan.

The Health cover UK market report 2013, published by Laing and Buisson in July 2013, showed that at the start of this year there were more than three million

employer-paid PMI schemes and 367,000 employer-paid dental insurance plans.

One reason for the rise in demand for group dental plans is the 2014 NHS charges review, which employee benefi ts providers expect to result in a rise in charges for NHS dental services.

The NHS currently offers three levels of charges for dental treatment for all patients, unless they are exempt. Exemptions currently cover pregnant women and nursing mothers with children up to 12 months old, students in full-time education up to age 19 and discretionary exemption up to age 23, plus recipients of various benefi t payments and allowances.

The lowest NHS charge is £18 for treatments such as X-rays and scaling and polishing; the next level is £49 for treatments such as

GROUP DENTAL PLANS

What are group dental plans?A group dental plan is an insurance-based scheme that offers employees cover for both preventative and restorative dental treatments. The plan gives staff access to dental insurance through their employer. The benefi ts can be accessed in various ways, including via private medical insurance, fl exible benefi ts or as part of a health cash plan. The level of cover can range from accident and emergency care to treatment for cancer.

What are the origins of group dental plans?National Dental Plan was the UK’s fi rst corporate dental insurance scheme in 1987.

Where can employers get more information and advice?Employers can get more information from the British Dental Health Foundation at: www.dentalhealth.org. More information is also available from employee benefi ts consultants or healthcare intermediaries.

What are the costs involved?Costs vary depending on the level of cover required, the way a scheme is funded and the number of employees covered. Accident and emergency cover can cost from £3 a month per employee. The average cost of dental insurance is £10-15 a month per employee.

The facts

Group dental plans are growing in importance for both employers and employees, says Ian Silvera

Drea

mst

ime

EB_0813 53EB_0813 53 23/07/2013 17:5523/07/2013 17:55

BUYER’S GUIDE


PRODUCT FILE

Any legal implications?There are no legal implications around offering employees dental benefi ts.

Any tax implications?Dental perks are classed as a benefi t in kind, so are subject to tax and national insurance. Employers must also be aware that they are required by law to fi ll in a P11D form.

Which providers have the biggest market share?The corporate dental market has traditionally been split equally between four providers: Bupa, Cigna HealthCare, Denplan and National Dental Plan. Other providers include Dencover, Health Shield, Medicash, Munroe Sutton, Simplyhealth and Westfi eld Health.

What is the annual spend on dental benefi ts?According to Laing and Buisson’s Dentistry UK market report 2011, published in January 2011, spending on public sector (NHS) dentistry was about £3.32 billion, 58% of total spending, and private dentistry spend was about £2.4 billion, 42% of total primary care dentistry spending. In the private sector, £1.8 billion was paid directly to dentists by patients for private treatment, including fees reimbursed in whole or in part by dental insurance and health cash plan claims. Private patients covered by dental capitation plans spent £588 million in dental plan subscriptions in 2009/10.

Which providers have increased their market share most over the past year?It is diffi cult to know, but while dental providers indicated they had all seen steady growth, there is anecdotal evidence that cash plan providers may be taking some of their business.

In Practice

@ Read also Dental benefi ts prove their worth at: bit.ly/13OXgpS

fi llings, and the top charge of £214 covers treatments such as crowns and inlays.

Although dental cover can be included in PMI schemes, a less costly trend emerging is for group dental plans to be offered through fl exible benefi ts. Two-thirds of NDP’s employer clients offer dental insurance through a fl ex scheme. Providers have noticed that the cost and complexity of pensions auto-enrolment has caused employers to rethink how they offer other benefi ts, such as dental perks. Many are now allowing staff to choose voluntary arrangements for dental care, with a view to moving to fl exible arrangements at a later stage.

Providers have also noticed an increase in the number of small and medium-sized enterprises (SMEs) offering dental benefi ts via fl ex. For example, in July 2013 Bupa launched a dental care product aimed at SMEs, providing cover for routine treatments.

The provider market has seen other recent changes. For example, Axa PPP Healthcare has launched a dental plan for employers to offer staff. It offers six levels of cover of staged

reimbursements per treatment. Staff have telephone access to dental nurses, and can also obtain information about how to maintain good dental health through an online dental health centre.

NDP has also launched a percentage reimbursement dental care product, called Radiant, which provides 100% reimbursement for preventative and minor treatments and 80% for major treatments. It will go live for employers in September 2013.

Health cash plansOffering dental benefi ts through health cash plans is an alternative to PMI. Cash plans have seen a surge in popularity because they can provide employers with a relatively cost-effective benefi t. For example, according to Laing and Buisson’s Dentistry UK market report 2011, the biggest proportion (31%) of claims paid out through health cash plans in 2011 related to dental treatment.

Various cash plans are available for employers to help staff cover their dental healthcare costs. For example, Simplyhealth’s core corporate-paid plan starts by providing up to £60 worth of dental cover and up to £300 worth of dental accident for £5 a month per employee.

Simplyhealth has also updated its employee-paid cash plans this year to include dental accident cover. The upper age limit to join has also been raised from 69 to 79. Premiums for this start from £2.83 a week, and it can cover up to four children under 18 and living

at home for free. These plans run alongside

Simplyhealth’s dental insurance, which offers premiums from £7 a month per employee for existing customers. New clients are provided with cover via Denplan.

By comparison, Cigna HealthCare’s standard insurance plan ranges from £3.31 to £20.18 a month per employee.

Engage Mutual also provides a health cash plan, which it launched in August 2012. This plan entitles employees to an annual allowance that they can spend on any one, or a range of, six treatment areas, including dental.

Two factors for employers to take into consideration are the fact that the default retirement age will increase to 67 by April 2028 and average life expectancy in the UK now stands at 80.

Older employees are much more likely to need dental treatment, partly because they grew up in an environment when there was no fl uoride toothpaste and now suffer from tooth decay much more than their younger colleagues and require more dental work.

Demand is also increasing for cosmetic dentistry, including teeth whitening. Providers describe this as an ‘Americanisation effect’, with employees no longer seeing dental benefi ts just for health purposes, but also to improve their personal image.

of employers offer dental insurance

for employees and their dependants on a voluntary basis (Employee Benefi ts Healthcare research 2013, published July 2013)

63% 18% 28%of employees without a

dental plan would consider one if their employer offered it (Denplan dental benefi ts survey, January 2013)

of UK adults said they don’t

go to the dentist more often because they can’t afford it (Dental survey 2013, Simplyhealth, published April 2013)

STATISTICS

EB_0813 54EB_0813 54 23/07/2013 18:2123/07/2013 18:21

That’s the world of Denplan for you.

Give us a call now to find out more

0800 587 1019www.denplan.co.uk/companies

Your employees are your most valuable asset

Support their health and wellbeing with a Denplan dental plan

Dental care is much more than having a brighter smile.

There is evidence that links oral to general health* and 69% of companies agree that

dental plans enhance employee wellbeing**. Taking a preventive approach to your

employees oral health can be the best way for them to avoid expensive treatments, while

potentially reducing absenteeism. Arranging a dental benefit not only shows you care

about their dental health but also their overall fitness and wellbeing.

* Source: British Medical Journal: BMJ 2010; 340:c2451

** 2013 Dental Benefits Survey - research undertaken by YouGov January 2013

CAM879 06-13

Denplan Limited, Denplan Court, Victoria Road, Winchester, SO23 7RG, UK.

Tel: +44 (0) 1962 828 000. Fax: +44 (0) 1962 840 846. Email: [email protected]

Part of Simplyhealth, Denplan Ltd is an Appointed Representative of Simplyhealth Access. Simplyhealth Access is incorporated in England and Wales, registered no. 183035 and is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation Authority. Denplan is regulated by the Jersey Financial Services Commission. Denplan Ltd only arranges insurance underwritten by Simplyhealth Access. Premiums received by Denplan Ltd are held by us as an agent of the insurer. Denplan Ltd is registered in England No. 1981238. The registered offices for these companies is Hambleden House, Waterloo Court, Andover, Hampshire. SP10 1LQ

EB_0813 55 04/07/2013 14:21

CONTACTDIRECTORY


Simplyhealth – we can be bothered Simplyhealth has been helping people access affordable healthcare for 140 years. We specialise in healthcare, so you can rely on us for our specialist knowledge. We’re the UK’s biggest cash plan provider and a major provider of dental plans, private health insurance, self funded health plans and mobility aids. We help nearly four million people with their health and 20,000 companies choose us as their healthcare provider including British Airways, the John Lewis Partnership, Royal Mail and Tesco.

We’re committed to delivering exceptional personal customer service, and go out of our way to do the right thing, not the easy thing. We’ve won many awards for our health plans and customer service. Most recently, we were named winner of the Customer Commitment Award at the 2013 UK Customer Satisfaction Awards for the second year running and we also won the Best Cash Plan Provider award at the 2012 COVER Excellence Awards.

We follow mutual values and care about our communities. Last year we donated over £1 million to local causes and national charities.

SimplyhealthSimplyhealth HouseDerwent Avenue ManchesterM21 7QP

Tel: 0845 075 0063

Email:[email protected]

Web:www.simplyhealth.co.uk/business

HEALTHCARE & WELLBEING

Next Jump is the world's largest corporaterewards and benefits provider supporting90,000 corporations with a network of 100million users globally. This includes more ofthe UK's largest organisations than anyother provider, making Next Jump thedefault choice for employee voluntarybenefits programmes.

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Next Jump Ltd.99 Waterloo RoadLondonSE1 8UL

Tel: 0800 690 6265E-mail: [email protected] Web: www.nextjump.co.ukContact: Brendan or Toby

VOLUNTARY BENEFITS

A leading provider of Lifestyle Management; Employee Discounts; Concierge Services and Reward & Recognition solutions.

With a range of clients from SMEs to large multinational organisations we are able to offer: � Discounts from over 3000 vendors which can

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the costs of absenteeism.

FitLinxx UK Ltd17 Campbell Court Campbell Road Bramley Hampshire RG26 5EG United Kingdom

Web: www.fitlinxx.comE-mail: [email protected] Phone: 01256 640 140

EB_0813 56 09/07/2013 15:32


CORPORATE CHILDCARE

Offering a real alternativeCo-operative Flexible Benefits is changing

the way we think about employee benefits by

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We already offer a comprehensive range of

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CORPORATE EYECARE

Choose Intelligent Corporate Eyecare (ICE) for the only electronic eyecare voucher that provides all of these benefits for just £25;

Can you afford not to choose Intelligent Corporate Eyecare?

Intelligent Corporate Eyecare14 Crown TerraceAberdeenAB11 6HE

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EAP PROVIDERS

AXA PPP healthcare is one of the largest, most experienced private medical insurers in the UK.We offer:

Private medical insurance Occupational health services Employee assistance and wellbeing programmes (EAPs)

Phillips HouseCrescent RoadTunbridge WellsKentTN1 2PL

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w: www.axappphealthcare.co.uk

Authorised and regulated by the Financial Services Authority. We may record and/or monitor calls for quality assurance, training and as a record of our conversation.

Our Vision - At Premier we believe in

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premiercompanies.co.uk 020 8663 5800

Premier Pensions Management Ltd Corinthian House17 Lansdowne RoadCroydonCR0 2BX

Tel: +44 (0)20 8663 5800Fax: +44 (0)20 3014 8768Email: [email protected]

EB_0812_PREMIER_dis 1 16/07/2012 15:57

EMPLOYEE BENEFITS CONSULTANTS

Enrich is one of the UK’s leading employee benefits consultancies. Our services include:

Pensions: auto-enrolment, planning and solutions, pension plan design, implementation, performance management and governance.

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Wellbeing: helping employees lead a healthier and more productive life.

Enrich51 MoorgateLondonEC2R 6BH

Tel: 020 7997 5800Fax: 020 7997 5801Contact: Jamie BarnesEmail: [email protected]: www.enrichbenefits.com

BENEFITS SOLUTIONS

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EB_0813 57EB_0813 57 09/07/2013 15:3209/07/2013 15:32

CONFESSIONS OF A BENEFITS MANAGER


I can tell you for certain that Big Bad Boss couldn’t care less about our health. The only reason we are

looking at a wellness programme is because they have one in the US.

Indeed, the Higher Beings over there wouldn’t be bothered if it wasn’t for the fact that staff illness costs money. Someone has woken up to the fact that our staff are not the healthiest bunch, and this costs us in terms of medical insurance, not to mention life insurance if they keel over while still on the payroll.

Big Bad Boss has sent me the US programme to review and implement. There are 27 documents; when HQ decides to do something, it really goes for it. However, Each document seems to be aimed at a six-year-old.

Luckily, I have not been asked to localise it for all of Europe, just to roll it out in the UK. Mind you, that will be hard enough. Our guys are already running around trying to meet their quarterly objectives, on top of a slew of HR programmes to complete every year, such as performance management, competency assessments, diversity training and ethnicity reporting. I can just see eyes rolling at the introduction of another activity viewed as unnecessary.

The US wellness education slides start with a lot of statistics about health globally. Apparently, obesity has more than doubled in the past 30 years. Then they talk about the top health issues in each country. Apparently, the UK’s top health

�

Healthy obsessionCandid is tasked with implementing a staff wellness programme that originated in the US, but fi nds her stress levels rising

Imagine if I could furnish chill-out rooms with nice candles and soft music. Maybe not”

issue is stress, followed by work-life issues (in other words, the number of hours of stress). If we want to fi x that, I think we should be looking at individual workloads, fl exible working arrangements and creating a more collaborative management style. Those things might actually infl uence the health of our staff, but no, instead we are giving them a wellness programme. Yippee.

The HQ wellness programme, I learn, is made up of several parts. First, there is an employee assistance programme (EAP). The good news is we already have one in the UK, across Europe in fact. Mind you, I am not very impressed with it. One of my colleagues rang for help when she was bereaved, and it just gave her a list of numbers to call. We might as well offer access to Google as an EAP for all the difference it really makes to someone in need.

The second part is a stress-awareness programme. My heart sinks. How can we, in all seriousness, tell our workforce to get healthy by managing their stress when the company is the main source of it? It is such a shame I am not given any leeway to do something more positive about stress. Imagine if we could stop treating people as if they are a commodity, like photocopy paper to

be churned out and then recycled?Even if we are not going to

change the way we treat employees, we could at least offer them some therapy at the end of it. Imagine if I could furnish chill-out rooms with nice candles and soft music. Maybe not, but perhaps I could contact that on-site massage fi rm that has been hassling me. I am sure it will be worth getting them in to do a demonstration; I am a martyr to the job, you know.

Next on the wellness programme action list is health assessment and health screening. This is an online

health test, which basically asks employees how many hours they slob in front of the TV while eating fast food and drinking beer.

At the end of it, staff discover just how unhealthy they are on a scale of one to 10, so that they may be motivated to do

something about it. I am quite sure our guys are too busy being stressed at work to fi ll in yet another questionnaire.

I can roll it out, but I just hope that the US doesn’t want me to track compliance.

On the screening side, HQ insists we get on-site testing for weight, height and blood pressure, plus various blood tests that it has branded ‘Know your numbers’. How am I going to get anyone around

here to agree to buy into that? Luckily, the Higher Beings get an annual health screening with their private medical insurance, so at least I don’t have to get them into a medical van in the car park.

Still, I can almost guarantee nobody from marketing or sales will turn up, unless we can fi nd a very attractive nurse.

I am also rather alarmed by the ‘numbers’ they think we should have. My cholesterol is around 4.5, which is supposed to be normal, but the programme recommends being under 200. It turns out that Americans measure all this stuff differently, so I will have to go through all the training documents.

Finally, we need to promote physical activity, because this can prevent all manner of expensive health problems. HQ has organised some after-work running and cycling clubs. I don’t think so. Not in these shoes.

Perhaps this is my chance to get the company to sponsor membership to that new fancy gym around the corner. Not that I am all that keen on sweating after work any more than I do during the day, but it could be nice to pop in there for a manicure in my lunch hour. Just think what that could do for my stress levels.Next time... Candid talks to the sales department about commission.

@ Read more Confessions at: bit.ly/RKlOt2

Employee Benefi ts accepts no responsibility for loss or damage to material submitted for publication. Copyright Centaur Media plc. All rights reserved.

No part may be reproduced in any form without written permission of the publisher. Employee Benefi ts is published by Centaur Media plc., the UK’s premier

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vacancies at Centaur. You can subscribe online to Employee Benefi ts at www.centaursubs.co.uk.12-month subscription: UK: £67, Europe & USA: £83, Rest

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EB_0813 58 23/07/2013 15:44

EB_0813 59EB_0813 59 17/07/2013 14:3417/07/2013 14:34

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Capita Employee Benefits is a trading name of Capita Employee Benefits Limited and Capita Employee Benefits (Consulting) Limited. Part of Capita plc. www.capita.co.uk. Capita Employee Benefits Limited and Capita Employee Benefits (Consulting) Limited are registered in England & Wales No: 02260524 and 01860772 respectively. Registered Office: 17 Rochester Row, Westminster, London, SW1P 1QT. Separately authorised and regulated by the Financial Conduct Authority.

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EB_0813 60EB_0813 60 17/07/2013 17:1217/07/2013 17:12

Documents

Build confidence into staff and business - Good Measures