Almost half of UK employees would like additional annual leave as a workplace benefit, but fewer than one in five currently receive extra days off, new data suggests.
The gap comes as businesses face greater pressure over pay, with 80 percent of employers reporting that employee salary expectations have increased because of the cost of living. Only 39 percent of workers believe their pay has kept pace, while 32 percent say they are experiencing financial stress.
Businesses are consequently examining the wider value of their reward packages. Some 59 percent of employers are exploring benefits and other non-salary options as they seek to strengthen their employee offering while controlling costs.
Extra time off tops employees’ wish lists
The figures come from the HR & Payroll Pulse 2026 study by SD Worx, a company providing HR, payroll and workforce management services. The wider research surveyed 5,936 HR decision-makers and 16,500 employees across 16 European countries, although the company has not provided the number of UK respondents in the material released with the results.
Additional leave was the most sought-after workplace benefit among UK respondents, selected by 47 percent. Only 17 percent said they currently had access to it, leaving a 30 percentage-point difference between demand and provision.
The discrepancy was considerably smaller for flexible working hours. Some 36 percent of employees wanted greater flexibility over when they work, while 32.5 percent reported already receiving it. Health and wellbeing programmes were sought by 31.5 percent.
The results do not suggest that employees regard benefits as a replacement for higher salaries. With fewer than four in ten believing their earnings have kept pace with living costs, financial security remains an important part of the reward package.
Laura Miller, UK people country leader at SD Worx, said employers needed to consider a broader range of factors when assessing what employees value rather than relying exclusively on salary increases.
“What we’re seeing is a much broader definition of value emerging,” she said. “Employees are telling us that time, flexibility and longer-term financial security matter too, whether that’s an extra day of annual leave, greater control over working hours or meaningful support with their pension.”
She argued that organisations under pressure to manage their own costs could benefit from understanding which elements of their reward packages employees value most.
“A reward package doesn’t have to cost more to feel more valuable, but it does have to reflect what employees actually want.”
Financial security remains a priority
Longer-term financial support also featured prominently in employees’ preferences. Four in ten said they valued pension and retirement planning support, compared with 24 percent who valued performance-related pay and 23 percent who wanted remuneration linked to skills and competencies.
Pension provision is already widespread among the UK employers surveyed, with 59 percent offering pension plans. A third provide retirement planning support.
Other financial benefits attracted interest from sizeable minorities. Three in ten employees valued discounts or other assistance with living costs, while 29 percent wanted transparent information about pay levels and fairness. A further 28 percent wanted a clear overview of their total rewards and benefits.
The importance attached to transparency extends to recruitment and retention. Nearly three-quarters of employees, 72 percent, considered pay transparency important or very important when deciding whether to join an organisation or remain with their current employer.
Yet discussing remuneration remains uncomfortable for many workers. Employers considered 65 percent of managers confident in conversations about pay and reward, while only 38 percent of employees themselves felt comfortable discussing or requesting a salary increase.
Reward packages under greater scrutiny
The results suggest employers looking beyond salary need to distinguish between benefits employees actively want and those that simply expand the number of items in a reward package.
Annual leave presents the largest gap identified in the UK data, while flexible working appears much closer to employees’ stated preferences. Financial support and greater visibility over the value of remuneration packages also remain important as household budgets stay under pressure.
Miller said communicating the overall employment package could become increasingly important for organisations competing for staff.
“The businesses that understand that distinction – and communicate the full value of their package clearly, will be in a much stronger position to attract and retain people.”
The study covers employees and HR decision-makers in Belgium, France, Germany, Italy, the Netherlands, Spain, the UK and nine other European countries. The figures reported for annual leave, pay expectations and benefit preferences relate specifically to UK respondents.
William Furney is a Managing Editor at Black and White Trading Ltd based in Kingston upon Hull, UK. His writing focuses on contemporary employment issues including pension schemes, employee health, financial struggles affecting workers and broader workplace trends.
- William Furney
- William Furney
- William Furney
- William Furney
