There is a widespread lack of understanding among employees of the value of their reward package, while uptake of total reward statements is low, according to a survey conducted by Aon Employee Benefits.
According to Aon’s Annual Benefits and Trends Survey, which surveyed nearly 500 UK businesses, 58 per cent of employers do not currently offer total reward statements, whilst just nine per cent have plans to introduce it.
The survey also found that 61 per cent of employers were concerned about their staff’s lack of financial understanding and 45 per cent did not feel their workforce fully understood their pension. This is a particular concern given recent changes to DC pensions which will force employees to make much more complex pension decisions.
When asked about the top three challenges employers experienced when implementing flexible benefit strategies, 63 per cent of survey respondents cited communicating with employees, 44 per cent cited keeping the flex scheme fresh and updated and 38 per cent cited administration and reporting as their top challenges.
Tobin Murphy-Coles, commercial director at Aon Employee Benefits said:
“These findings, mixed with increasingly complex decisions employees need to make, show employers that reward communications are a high priority. Total reward statements can certainly form part of this. New platforms not only deliver flexible, voluntary and online benefits, pensions and auto-enrolment but give employees a way of managing all their savings, debts, investments and earnings in one place. There is considerable scope for employers and employees to share this financial responsibility, serving the needs of both in a stronger way.”
He continued:
“Platforms such as Bigblue provide employers with an employee-friendly way of increasing engagement in benefits and financial education. This enables individuals to better plan for their current financial situation, as well as their future needs. Good systems enable full understanding about the decisions individuals make and their implications.”
Anne Oliver, head of communications at Aon Employee Benefits, added:
“We need to be smarter with our messaging and segmentation methodology to ensure we deliver the right message to the right person at the right time, so it leads them to take action. From our work in the US, we’ve proved that people’s values and attitudes are better predictors to their actions than demographics. So introducing marketing techniques to reward communications will engage better with employees and increase effectiveness”.