What does 2021 mean for employee benefits?12.01.21
Charlotte Godley, Head of Proposition
I think it is fair to say that we were hoping that 2021 would not start the way it has, with the country back to full lockdown! At least this time around, there is a light at the end of the tunnel with the roll out of vaccinations, but given the rather subdued Christmas and New Year celebrations, for most of us it is still a tough start, and that’s even before we mention politics!
Where “unprecedented” was probably the word of 2020, it seems that “uncertainty” is likely to be at the top of the list for 2021. Whilst I could (and probably will!) write a lot more about the uncertain future of businesses, likely increase in mergers and acquisitions, redundancies and how our own pockets could be impacted by the cost of COVID as well as Brexit, for now I will focus on employee benefits in 2021, which is a safer and, I hope, more positive place to rest my mind!
Employee wellbeing remains top of the HR agenda
Undoubtedly, wellness will continue to be a significant theme in 2021 and will continue underpin everything we do at Benefex. In keeping with my optimistic outlook, we will be returning to the physical workplace to some degree in 2021. This will be welcomed by many, but also has its challenges – financially, through cost of commuting and additional childcare costs plus, for some, a reduced household income; but also mentally and emotionally, with continued uncertainty where even going back to travelling on public transport may well fill some people with dread!
Ensure your wellbeing strategy and communication is robust!
It has been great to hear that so many businesses invested in the wellbeing of their employees in 2020, and the challenge now is to ensure your wellbeing strategy is fit for the future. At Benefex we have seen great uptake of our Communications Manager module, which has really helped customers to reach employees with relevant and timely information, and smart use of OneHub has meant that all the great work that has been done relating to wellbeing can be easily accessed so employees can take advantage of what is offer and therefore that your return on investment is maximised. I know the wonderful Gethin Nadin’s Wellbeing Wednesdays were extremely well received throughout 2020 and he will be continuing to provide insight and support over the coming weeks and months.
What to expect from benefits in 2021
Employee benefits and online benefits platforms are going to play a key part in helping employees adapt to more changes in their personal and professional lives and in supporting employers in communicating and engaging with their employees.
We saw an increase in the uptake of Protection benefits such as Additional Life Assurance, Spouse/Partner Life Assurance and Critical illness in 2020, and we expect this trend to continue as everyone continues to focus on their health
Season tickets loans
These are likely to see an increase in uptake when we return to the workplace and with a focus on managing spend. Considering the financial impact of COVID on many individuals, employers may want to consider extending the use of employee loans to support their employees further
Where we have seen a reduction in the value of contributions to Childcare Vouchers, I expect this to increase as children go back into formal childcare arrangements when parents return to work. We could also see more employers looking at other arrangements to support working families such as emergency care
We have already seen an increase in cycle to work take up in 2020, and many employers increased the maximum limit to allow employees to purchase electric bikes, as many people looked to avoid using public transport. If the government does move to subsiding the purchase of electric bikes which is currently under consideration, this is likely to increase further
Benefit-in-kind tax on Ultra Low Emission Cars is due to increase to 1% from April 2021 but remains hugely beneficial, and there is a much wider range of electric vehicles now available so I anticipate that take-up of these schemes will continue to increase this year
Gym membership and equipment
This is an interesting one! A lot more people are working out from home, but the question is whether they will go back to the gym or will continue with home workouts. It is likely to be a mix, but I am sure that at-home workouts will continue to be popular, so would certainly recommend you ensure your gym offering includes access to at-home workouts as well as physical gyms
Online learning has seen a huge upturn in 2020 as we all decided to use our commuting time to learn a new skill (mine was Spanish, which has had limited success!!) and we have seen more employers extending the use of OneHub to encompass Learning modules
Unsurprisingly, fewer employees selected Holiday Buy in 2020, so I expect to see this increase in 2021 as many of us are desperate to get abroad (fingers crossed!) This benefit can also support employers in managing cost, so it may be that the number of additional days allowed will be increased to encourage take-up
Improving benefits return on investment
Overall, value for money both for the employer and the employee is going to be key in 2021. Many benefit providers offer additional products at no extra cost such as EAPs, virtual GPs and access to discounted products, so this could be a good time to review your benefits offering to make sure you are getting the most for your money
Get your people involved with employee feedback
I know you may feel employees are surveyed-out as many employers issued a number of surveys in 2020, but the best way to understand whether your benefits plans are right for your employees is to ask them! We’d be happy to support you in developing a survey with a few simple questions to ensure your employees value and understand what you are offering
In summary, it’s a good time to review what you have, address any obvious gaps, and ensure you are maximising value. At Benefex we are always on the look-out for new benefits that align with our customers’ needs so watch this space! And make sure your employees know about what you offer – communication is key!
Charlotte is Head of Proposition at Benefex