Employers use competitive remuneration packages to attract and retain the very best employees. Skilled and high-quality talented individuals are constantly in high demand and many businesses are in competition with one another. A good remuneration package adds to an employer brand and can make a business more attractive to those skilled candidates for both attracting new talent and also to keep existing employees happy.
A recent study highlights 69% of employees would choose one job over another if it offered better benefits. In addition, 75% of employees are more likely to stay with their employer because of their employee benefits package.
What is a remuneration package?
A remuneration package is the collection of benefits offered to an employee by their employer and can be seen as the complete offering by an employer. It includes an employee’s wage or salary, but more appealing packages will also offer other benefits such as; bonuses, enhanced pension schemes, enhanced annual leave entitlement, health and wellbeing programmes, flexible working, company cars and they can even include reward programmes, e.g. employee of the month.
A comprehensive, well thought out employee remuneration package should align with the Company’s mission and values. Today employees and potential candidates are looking to work for Companies with purpose, who demonstrate corporate social responsibility and treat its employees in a way that aligns with its culture and values. When candidates are comparing an offer between two different businesses, the remuneration and benefits package can provide a strong sense of the corporate culture.
But what does an attractive remuneration package look like to an employee?
It is vital that the Company’s benchmark their employee remuneration package against others in the UK to see how it compares in the market. Here are some remuneration package examples, included in the current benefit packages on offer in the UK;
• Competitive salary – the salary for an employer’s top and high demand roles should be competitive and meet or exceed the market standard. Salaries should also be regularly reviewed and benchmarked against the market and cost of living to keep them competitive. Performance-related pay can be used as an annual reward to review performance against objectives and behaviour, and linked to an annual base pay increase.
• Bonus scheme – some employer’s offer incentives in the form of an annual bonus or performance-based bonus to reward employee achievements and loyalty. Bonus schemes should work alongside clear targets to help drive employee performance, engagement and development.
• Flexible working – research shows that one of the top retention strategies for employers is flexible working, with 42% of employees choosing to stay with their employer because of the flexibility on offer. This could be flexibility of hours they work or home working. Flexible working is becoming increasingly popular, as employees seek to maintain a healthy work-life balance or to manage long commutes.
• Work-life balance – whether intended or not, people are encouraged to be connected 24/7 due to advances in technology, as a result, employees’ are drawn to companies which promote a healthy work-life balance. An effective way to manage this is by encouraging employees to take holidays and to go home on time.
• Unique benefits – a good remuneration package should aim to include some unique benefits to the Company or employees to make the offering stand out. For example, this could be; wellbeing schemes for employees, Employee Assistance Programs, financial planning, legal assistance, emergency childcare, or elderly care, or discounts on services or equipment the company offers.
A good comprehensive remuneration package is built on much more than just bonuses and salaries. There are differet types of remuneration that you can include to make remuneration packages more attractive. Here’s what other companies in the UK offer:
• Flexible benefits – this type of benefit program offers employees a choice between various benefits including cash, life insurance, health insurance, annual leave, retirement plans, gym membership and child care. Employees can choose to spend a % of salary against the benefits they most value and suit their lifestyle. It is estimated that 1 in 2 people would leave their current employer if they were offered a flexible remuneration package and benefits for the same role elsewhere.
• Career progression – a recent studied showed that more than two in five employees say that career progression opportunities are a big factor in how happy they are at work. It is important to employees that they can see a career ladder or pathway to progress so they can see options and routes available to them.
• Perks of the job – small regular perks, like team lunches, gift card rewards, an employee of the month, a thank you card from the MD and celebrations for a job well done are all ways to make your employees feel appreciated.
When assessing the remuneration package on offer, it’s important to remember employees pay tax on some company benefits and this is deducted from an employee’s earnings via the Company’s PAYE. The amount an employee pays depends on what kind of benefits they receive and their value.
In order to compete Company’s need to ensure that the remuneration package on offer is not only in-line with other companies in the industry, but also brings something unique to the table.
If you would like further guidance or support on this matter or require advice on other people management matters please contact Clover HR on 0121 516 0299 or email us at email@example.com
Copyright Clover HR