Flexible Benefits
Flexible Benefits
Introduction
The "home" of flexible benefits is in the US, where the concept is strongly established. With a limited national health service, medical insurance is the responsibility of the individual and employees are typically offered healthcare insurance, covering private medical, optical dental, physiotherapy etc. through their flexible benefits scheme.
Flexible benefits is an employee reward system, which allows employees to choose from a menu of optional benefits to suit their preferences and lifestyle requirements. They are normally allocated an amount to spend on benefits; this may be a percentage of their salary or a set sum, which enables companies to more accurately predict the overall cost of their benefits.
According to Michael Armstrong (2002)
“Flexible benefit systems means that individuals can tailor their benefits to suit their personal needs and particular obligations and aspirations. From the employer’s point of view a flexible benefit policy can save money on benefits which are neither needed nor wanted”
One of the most commonly cited reasons for introducing flexible benefits is to improve recruitment and retention. According to an independent survey sponsored by RebusHR and carried out by Sandheys Consulting in 2002, 100% of firms interviewed agreed that flexible benefits helped or would help with recruitment and retention of staff.
Other key business drivers for introducing flexible benefits are:
Globalisation
Mergers and acquisitions
Tax efficiencies
Group Rates
Reduced third party costs
Not-for profit service
Government legislation/pressure
Background
In 1998, the organisation implemented a Flexible Benefits Package in order to provide the employee with more choice in their options and make a cost saving for the organisation. Out of 81 employee's currently employed only 11 remain on the old benefits package. The organisation has made a saving with every new
Introduction
The "home" of flexible benefits is in the US, where the concept is strongly established. With a limited national health service, medical insurance is the responsibility of the individual and employees are typically offered healthcare insurance, covering private medical, optical dental, physiotherapy etc. through their flexible benefits scheme.
Flexible benefits is an employee reward system, which allows employees to choose from a menu of optional benefits to suit their preferences and lifestyle requirements. They are normally allocated an amount to spend on benefits; this may be a percentage of their salary or a set sum, which enables companies to more accurately predict the overall cost of their benefits.
According to Michael Armstrong (2002)
“Flexible benefit systems means that individuals can tailor their benefits to suit their personal needs and particular obligations and aspirations. From the employer’s point of view a flexible benefit policy can save money on benefits which are neither needed nor wanted”
One of the most commonly cited reasons for introducing flexible benefits is to improve recruitment and retention. According to an independent survey sponsored by RebusHR and carried out by Sandheys Consulting in 2002, 100% of firms interviewed agreed that flexible benefits helped or would help with recruitment and retention of staff.
Other key business drivers for introducing flexible benefits are:
Globalisation
Mergers and acquisitions
Tax efficiencies
Group Rates
Reduced third party costs
Not-for profit service
Government legislation/pressure
Background
In 1998, the organisation implemented a Flexible Benefits Package in order to provide the employee with more choice in their options and make a cost saving for the organisation. Out of 81 employee's currently employed only 11 remain on the old benefits package. The organisation has made a saving with every new