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The six pillars of an effective flexible benefits scheme

uploaded on 15 January 2021

Group of people sitting down smiling

The six pillars of an effective flexible benefits scheme

With 2021 just beginning, now is the right time to review whether your organisation’s benefits offering supports your employees’ needs, and drives engagement.

This time last year no one could have anticipated the way Coronavirus has impacted our personal lives and the way in which we work. As a result, employee benefit schemes designed before the pandemic hit, are unlikely to meet the needs employees have today.

Review is critical to ensure your scheme meets its intended objectives - to support employee needs and drive engagement.

While pay rises are off the table, a well-designed and fit-for-purpose benefits package can be a tax efficient way for employers to increase the value of an employee’s total reward;

to ensure they have the right support from a financial and health wellbeing perspective, whilst still acting as an attraction and retention tool.

Whether an organisation wants to scrutinise an existing flex scheme or think about introducing one for the first time, the north star question remains the same. How could it deliver better value for you?

1. Have you got the tech you need?


The best place to start is looking at modern, innovative SaaS software, which provides a far greater degree of flexibility and adaptability. Without superior software, it won’t be possible to keep pace with the support employees need as changes emerge. Changes are happening faster and more frequently than before as Coronavirus impacts employees’ health, finances, wellbeing and place of work. Staff need to be able to access and amend benefits on any mobile device, at any time. The organisation needs to do this without it being a significant drain on cost and time.

With a reduced employee headcount, many organisations simply don’t have the human resource to keep on top off the wide range of benefits employees might need access to. Neither do they have the time or money to administer schemes manually or through clunky platforms.

While technology is the foundation of a successful flexible benefits offering, a scheme can only deliver best value if it rests on the other five pillars that drive success. Use these to evaluate the effectiveness of your own scheme. For some this will help them to realise

2. Is the scheme designed around the needs of your workforce?

Every workforce is unique, comprising multiple generations of employees that have different incomes, lifestyles, responsibilities and requirements. Employees will only engage with a scheme and take-up benefits that meets their needs at the time the need presents. Employers should take time to research, segment, and understand what benefits will appeal to each segment. Having a partner who can undertake this diagnostic to benchmark and make recommendations aligned to your overall EVP strategy is essential. This is the foundation upon which you will build. Agree a return on investment to aim for and design the scheme to leverage NI savings for the organisation, maximise uptake and ultimately be a key component of employee satisfaction.

3. Think carefully about how you need to resource the implementation and renewal, don’t rush it

Use ROI measures to identify key stakeholders to resource implementation. You’ll need colleagues with people expertise as well as ones with a financial background. Take time to establish solid governance and structure of the implementation team and methodology. Allow sufficient time to implement and ensure that you take the opportunity to refresh, rethink and revise the offering. Class leading platforms can provide fantastic insight and data, make sure you take time to understand and act on it.

4. Cleanse, correct and validate data

The quality of employee data fed into your scheme matters. Inaccurate data undermines the user experience and takes time and resource to fix. Only accurate data should be entered into the system. Use an automated system to transfer, check and validate data to reduce the risk of human error. Edenred uses intelligent data validation tools to cross check critical information such as tax codes correlating.

5. Review management information regularly

You’ll be able to mine a ton of information from your software but it’s what you do with that information that matters. Use it to identify what’s working and what’s not. Benchmark against the changing nature of the market, organisation and employee needs. Draw intelligence and consult with experts to make recommendations. Take action, drive change and ensure you are on track to deliver the agreed ROI.

6. Help employees understand how they personally benefit from the scheme

The effectiveness of your communication strategy will either strengthen or undermine the other pillars. If you have taken the time to research and segment your workforce you will have the necessary information and insight to understand what, when and how to communicate to each segment.

Nestle does this particularly well by building personas of employees in each segment. Representations that articulate the thoughts, fears and behavioural characteristics of each group. Nestle draws on this information to define key messages and identify the most relevant method of communication for each segment.

Vlogs tend to be used more frequently to communicate with the younger generation and written content for the older. The better an employee understands the positive impact a benefit will have on their life, the more likely they are to engage with it. Benefits with tax-related implications are complicated. Wading through the terms and conditions turns many people off. The better an organisation can communicate to break down barriers to understanding complex benefits, highlighting and selling the advantages to their people, the greater the take-up.

Budgets will be tight for 2021 and senior leaders are right to question the effectiveness and cost of employee engagement schemes like flex. Make sure yours is built on a solid foundation, supported by the key pillars to create a fantastic user journey experience. One that employees want to engage with because they understand it’s relevance.

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