Why Flexible Benefits Are Back On The Agenda

By Marcus Beaver, Sales Director, Symatrix

Many larger companies have used some type of flexible benefits package in the past, but recently the trend has seen a resurrection and not just in bigger corporations. Now, many smaller and medium sized companies are seeing the advantages that this type of plan offers and implementing their own versions.

What Are Flexible Benefits?
Benefits are one of the “perks” of working and vary by employer. They include many different things such as: private medical insurance, childcare vouchers, pension plans, life insurance, dental coverage, gym membership, company cars, training and development, ability to buy/sell annual leave, etc.

Unlike standard benefits, where all employees in the company get the same types of “perks”, flexible benefit schemes allow employees to choose the benefits that best suit their needs and lifestyles. Employees get a “benefit allowance” and they decide which benefits and in what quantities they would like. Employees usually get two choices; they can leave their salary alone and just use the benefit allowance offered to them, or they can adjust their salary, flexing it either up or down to either take more or less benefits.

Why Are Flexible Benefits Making a Resurgence?
Today’s workforce is more diverse than ever in terms of culture, religion, age and gender, and the days of “one size fits all” policies no longer work. Companies realise that they have a responsibility to look out for the best interests of their employees and this often includes the need to do things differently.

Flexible benefit schemes are becoming more popular now and for good reason. Flexible benefits are an easy way to attract and retain talent in an organisation as employees appreciate being given the freedom and control to choose the benefit package that best suits their individual needs and they also tend to value these benefits more. With the economic situation being as it currently is, many organisations are not able to provide pay rises, even to their most talented employees, so using flexible benefits is a way to give those members of staff a little something extra without the company incurring too much cost.

Also, with the current market, it is proving more difficult to recruit new talent as people are afraid to leave their current positions. Therefore, it is vital to be able to entice new job seekers into joining your organisation. Offering higher salaries is challenging as companies are having to “tighten their belts,” so providing a competitive and flexible benefits package is an effective way to lure them.

Flexible benefits are also a good fit for companies that have merged or have acquired another company as when organisations come together, there is often a mis-match in the benefits that they offer. Companies are facing the challenge of having to harmonise benefits across the whole organisation without being seen to be taking benefits away from employees, or significantly increasing their costs by giving everyone the highest level of benefits.

For example, one company may give its employees more holidays, whereas another company may provide a better car allowance. When these two companies come together, the newly joined company can not afford to give all of the employees more holidays and a better car allowance, but by choosing one or the other, or minimising both, there is bound to be discontent from the staff. Flexible benefits works for both the employers and the staff as it gives the employees the freedom to choose the benefits they want and the amounts of each, while also putting a cap on the amount of cost that a company has to put out in terms of benefits. A flexible benefits scheme allows the company to harmonise benefits at a holistic package level, rather than at an individual component level.

Want To Learn More?
Flexible Benefits is now a key component of Oracle HCM. Contact us to find out more about the capabilities of Oracle HCM, and how Symatrix can help you plan and implement flexible benefits within Oracle HCM. For UK enquiries, please call John Brownhill on +44 (0)1372 860 740 or email him at john.brownhill@symatrix.com