United Kingdom

Offering flexible benefits via salary sacrifice is becoming increasingly popular among UK employers who already provide them, new research has found.

August 2014


Nearly 60 per cent of UK employers now provide benefits funded by salary sacrifice schemes such as childcare vouchers, cycle-to-work schemes and additional pension contributions.

One fifth of employers also provide voluntary benefits such as gym membership or retail discounts, with 70 per cent of employers who offer them doing so via a third party provider.


"It makes so much sense to wrap up all of these existing benefits into one cohesive, branded, flexible benefits offering," said Matt Duffy, Head of Online Consultancy at Aon Employee Benefits. "Rather than employees considering each of these benefits in isolation – and usually referring to the individual provider brand names – combining all benefits in one place, under one employee benefits brand, leads to a far higher level of engagement in benefits and a better appreciation of their value."


According to the XpertHR research which polled over 300 UK companies, the top five flexible benefits include childcare vouchers, additional pension contributions, private medical insurance, dental insurance and cycle-to-work schemes.

However, due to the changeable nature of flexible benefits which allow employees to 'pick and choose' the type of benefits which are relevant to them, many employers view flexible benefits as too complex to implement. As such, just 12 per cent of UK employers actually provide them.

But, says Duffy, this is a 'widespread misconception':

"There is a time commitment from an employer during the design and build phase of the scheme, but partnering with an experienced provider who can hand-hold clients through the implementation journey, avoiding pitfalls and outsourcing the administration can make the introduction of a flexible benefits scheme pain free," he explained. "The returns to an organisation can far outweigh the time and financial cost of implementation."



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