As a caring leader of a small company, you may be wondering how to set up benefits for your employees without smashing the budget. Employee benefits can help you recruit and retain talented employees, as well as support their wellbeing and increase productivity. But, when every penny counts, it can feel difficult to spend on something that may not appear ‘essential’ to everyone.
However, that doesn’t mean that benefits are out of reach for your company. We’ve put together our top tips for creating a cost-effective employee benefits scheme so you can get started, no matter the size of your organisation.
We’ve outlined 5 ways you can implement employee benefits as a small business with the help of a financial wellbeing provider:
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1. Focus on what employees really need
It’s tempting to jump straight into a benefits programme if you want to get something up and running quickly. However, if you don’t take time to plan, you run the risk of investing in benefits your employees won’t need or use.
Before you get started, do your research. That might look like an employee survey, or even a workshop where you think together about what kind of benefits package would work best for your team. Try to find out what problems your employees are facing: do they need support with childcare, transport costs, mental health, or financial health?
2. Make the most of your workplace pension
You may not have thought about your workplace pension scheme as an employee benefit. After all, it’s something you’re obliged to provide for your team. But this can form a huge part of helping your employees build financial wellbeing and confidence in their futures.
On a basic level, your employees will benefit from your employer contribution and the tax relief they get from the government, at the same time as building their savings pot for retirement. Helping them understand their pension scheme and keep on saving into it can be a simple way to increase their wellbeing.
But you can also take it further. With a small cost increase to you, you can put more into their pot, perhaps through a matching scheme. You could also change the way the scheme is set up, such as switching to salary sacrifice (see below) or paying contributions based on full pensionable earnings (their whole salary) rather than their qualifying earnings (the amount between the minimum and maximum bands).
When it comes down to it, the most impactful way you can support your employees with their pension isn’t necessarily through higher contributions – it’s by helping them understand how much they need to save and guiding them to take the right action.
According to the Pensions and Lifetime Savings Association (PLSA), most people don’t know how much they should be putting away to achieve a comfortable retirement, and behavioural research shows that personalised guidance and nudges can significantly improve pension engagement and saving rates.
That’s where pension coaching support comes in. It combines financial education, personalised projections, and 1:1 guidance to help employees make confident decisions about their retirement savings, even if your organisation can’t afford to increase employer contributions. It’s a cost-effective way to unlock long-term financial wellbeing for your team.
3. Take advantage of salary sacrifice
Introducing salary sacrifice benefits can be a great way to give more to employees at the same time as saving your organisation money. There are a number of great schemes out there, including salary sacrifice pensions, Cycle 2 Work, workplace nurseries, and electric vehicles. When employees sign up, they can get a benefit at a reduced rate, while you save money on employer National Insurance payments. Find out more about the range of tax exempt salary sacrifice schemes available here.
With the money you save on employer NI, you may be able to unlock extra budget to invest in other employee benefits. As such, it can be a good way to start building your offer for employees.
4. Exploit technology for low-cost support
Many employees will be comfortable using technology, especially their phone, which can be a good way to bring benefits to them at a lower cost. For example, rather than spending hundreds or even thousands on a set of in-person workshops, a digital education or financial wellbeing solution (like Maji) can give them ongoing access to helpful materials that they can continue to use, for a cheaper price.
Similarly, rather than employing an in-house coach for expensive support sessions, using a digital service can save you money and make it easier for employees to connect at their own pace.
5. Help employees engage
Once you start investing in your first benefits, you’ll want to get the best return on investment with high employee engagement. Spending money on something nobody uses is just pointless.
You can help your employees understand and engage with their new benefits through webinars, team meetings, lunch and learn sessions, or including them in your newsletter. But tech can unlock new ways to highlight relevant benefits, too: on Maji’s app, employees can see benefits like shopping discounts integrated into their spending plans. For example, if they spent £10 at Sainsbury’s but could have accessed a 5% shopping voucher, they’ll see the potential savings on their breakdown of spending. This can help them understand exactly what’s available and why they should use it!
A good tech platform can be used to send alerts, nudges and personalised insights that drive high engagement – and therefore deliver a better return on investment.
For younger employees in particular, tech is not a nice-to-have, it’s a necessity. In fact, 98% of Gen Z own a smartphone, and 91% say the technology an employer uses would influence their job choice. With this generation entering and reshaping the workforce, investing in a digital-first benefits platform that drives engagement isn’t just smart – it’s vital.
How to get started with employee benefits
If you have some understanding of what your employees need, it’s time to think about your budget and where you want to spend it. This is also the perfect point to consider working with a financial wellbeing provider, who can help you choose benefits that deliver real value for your team while maximising your budget.
Remember that setting up salary sacrifice benefits can be a good way to make your employee benefits budget go further, even if it’s a limited one.
Maji’s financial wellbeing solution supports employees across their different life stages, with educational materials, digital and 1:1 coaching, and a series of exciting tools to help them plan their finances. What’s more, Maji can help you introduce a range of salary sacrifice benefits that can unlock NI savings for you at the same time as giving employees something they need.
To find out more about how Maji can help your small company get started with employee benefits, schedule a demo.
