Benefits packages have, historically, been the extra element to a job offer with which companies look to make a difference to talent acquisition and retention. As the scope of benefits packages within the industry increases, the impact they have on which offers jobseekers choose to accept – and the companies they choose to remain with – becomes greater than ever. In order to stand a chance at remaining competitive in their hiring and staff retention, it’s vital that companies understand what is being offered “as standard” elsewhere in the market – then react accordingly.
Twenty years ago, offering a slightly better company car or a day or two of extra holiday might have been a deal-maker, but the impact those elements will have on the final decision these days has grown proportionately less as benefits packages become increasingly impressive.
We’ve noticed that there appears to be two schools of thought within digital commerce – it seems that the major eCommerce solution providers put more money into their basic salaries and, due to their natural work cycles, can present the challenge of regularly changing projects and clients. The large retailers, however, offset the single client base and BAU work, and cover any salary discrepancy by increasing what’s on offer in term of benefits.
This might make it seem like these businesses offer a higher wage in lieu of benefits but that’s not the case – what these companies are providing outside of salary is competitive with other areas of the technology market and certainly a step forward from previous ‘standard benefits’. 25 days holiday, a 3% pension, flexible working including the option to remote work, substantial discretionary bonuses of circa 8% salary, plus healthcare (sometimes individual, sometimes family) are all in the average benefits package.
Conversely, though large retailers may offer less on base salary, many make up for it with an extremely enticing benefits offering. On average, bonuses and pension contributions will be higher, reaching up to 15% for bonuses and anywhere from a pension match around the 10% mark to a contribution doubling scheme up to 9% – which sees an employer paying an extra sum of up to 18% of the worker’s salary into their pension.
Beyond the financial, healthcare is more often than not for family rather than just the individual, and often supplemented with a dental care policy. There’s an investment in quality as well as health, with these businesses ensuring their staff have access to highest specification equipment and gadgets to create engaged and exciting workplaces, and staff may be given up to £1,000 per year to invest in their own ongoing professional learning and development.
Work/life balance is another area where start-ups especially appear to be making a better offering than more established businesses. While “birthday off” is now standard and extra to the standard 25 days, a further day off per year for a ‘life event’ (wedding, christening, funeral etc.) is being introduced at some companies, and seasonal adjustments can have a huge impact on how employees regard their workplace. A full shut-down over Christmas without counting that time towards annual leave will boost 25 days holiday into the 30s on some years. The most cutting-edge approach to work/life balance we’ve seen recently are companies who operate ‘summer hours’, with the working day wrapping up at 3pm in July and August, effectively putting another 10 daysworth of time off on the table for their staff.
Holidays are a subject for discussion too. Some businesses are investing in a company holiday to assorted exotic locations, and not as an incentive trip to be earned either – merely as part of the package. On top of that, another newer initiative that some start-ups have implemented is the idea of offering staff a sabbatical after a given number of years’ service (an average of four, from what we’ve seen) and giving their workers spending money (£2k average) for this time away from work.
Make no mistake about it, all these elements combined in a benefits package made available across all staff is a huge investment – but one which, if judged correctly, can offer an equally huge return on investment. A strong benefits offering makes it more likely that the best talent will flock to work for you, increasing output potential, both in terms of quantity and quality which, one would hope, will lead to a strengthening of reputation, more customer satisfaction, more repeat business, and more revenue. Beyond this, the better the benefits package, the harder it will be for an employee to walk away at the first sniff of a slightly better salary, which will lead to higher staff retention rates and a more consistent workforce and company culture – which, in turn, you would also hope would lead to better productivity levels, not to mention less time and money spent in recruiting, inducting and upskilling replacements.
