United Kingdom

2021 and beyond: Looking at the future of employee benefits in a post-COVID world

We’re in the midst of a shift in how companies view employees; we’re seeing more companies adopt an employee-centric model in how they approach employee benefits and the wider employee experience.

Global Medical Trends

In part due to COVID-19, we’re also seeing a lot of change across both strategy and employee expectations; in Aon’s 2021 UK Benefits and Trends Survey, 79% of companies responded that they believed they would need to change their benefits offering to meet the needs of future generations. Employers also appeared to be tuned in with employee needs; 91% said they believe employee expectations are changing, and nearly half (40%) said they believe their current benefits do not meet the needs of the existing generations in their workforce. It’s clear that there is still a great deal of change yet to happen.

Using data from our recent HR Pulse Survey and the 2021 UK Benefits and Trends Survey, we take a look at how 2021 changed the employee benefits landscape, what the future of employee benefits holds, and whether companies are ready for the road ahead.

Agile working

The COVID-19 pandemic has catalysed huge amounts of change in how we work and where. Our Pulse Survey research shows that for nearly three-quarters of organisations, over half of their traditionally office-based workforce are now working remotely. Initial research suggests that this forced change is here to stay; 85% of businesses either have or are actively considering future agile ways of working, with 81% currently evaluating or updating their longer-term approach to remote and virtual working. Nearly half (43%) of organisations have permanently expanded the population of employees who qualify for remote working.

These changes reflect how HR professionals perceive employee expectations; 95% of organisations reported that employees expect agile/home working, and 93% responded that employees wanted more flexibility in their working hours. Here, there is a clear correlation between employee expectations and employer proactivity. Although agile and remote working bring their own challenges, it looks like – in the most part – the change will be long-term.

Benefits strategy

Inevitably, the changes have also impacted the benefits employees are interested in – and this is reflected in the benefits companies are offering. Perhaps driven by the responses from employee engagement surveys, our pulse survey also showed that 78% of businesses are already or actively considering evaluating and updating their approach to total rewards. Historically, we have often seen a disconnect between the benefits offered by companies and those valued by employees – potentially we will start to see supply and demand align more closely.

There’s also been a shift in how employers are presenting their employee benefits to their workforce. Our 2021 UK Benefits and Trends survey showed that only 28% of companies have a clear Employee Value Proposition (EVP). Considering the upward trend in companies reporting they believe their EVP has a positive impact on employee engagement, retention and recruitment, it’s not surprising to see that a further 43% of respondents are planning to formalise an EVP for the first time.


Unsurprisingly, with a shift in working practices, we have seen that the vast proportion of companies (86%) have given communications a higher priority since COVID-19. However, nearly half (49%) still have no allocated budget and just over a third (36%) have no internal resources to support creating an engaging benefits and wellbeing communications programme. We are also still seeing that the more traditional routes of communication are still being utilised – email (95%), virtual webinars (55%) and manager cascade (39%). It may be that due to homeworking these methods are not as engaging as they once were; employees may have an element of communications overload and technology fatigue. We are starting to see alternative methods emerge – video and animations, apps and podcasts were all listed by respondents as utilised channels – but it’s clear that limited resources are a barrier to adoption. The future does look bright for technology and apps; 82% of employers stated that they believe that in the future they will impact employee engagement positively.

Perhaps as a result of the financial uncertainty caused by the COVID-19 pandemic, we have also seen that 75% of companies are planning to enhance their communications around financial wellbeing. For optimum engagement, employers will have to integrate into their overall financial wellbeing strategy – whether they are utilising financial education, technological support such as apps or more physical support such as workplace saving schemes.

Employee Wellbeing

In the past twelve months, the vast proportion of companies have placed a greater emphasis on employee wellbeing, with mental health, wellbeing for homeworking, and work/life balance all appearing as key priorities.

Just over a third of businesses (37%) also expect their health and wellbeing budges to increase in light of the pandemic, and 77% of businesses planning to have a formalised health and wellbeing strategy within in the next 12-18 months. These changes have been reflected in an increase in companies who have a Board level sponsor for their health and wellbeing strategy; suggesting that more employers are planning to focus on and invest in employee wellbeing as part of their long-term plans.

However, whilst we have seen that the majority of employers have defined strategy in place for mental and emotional health (76%), and physical health (61%), only a third had a defined strategy for career wellbeing (32%) and social wellbeing (30%). We must not lose sight of supporting the other pillars of wellbeing, which have been equally affected by the pandemic – especially when employees are potentially isolated whilst working from home, with other forms of opportunity for social interaction also drastically reduced by the pandemic.

Despite the challenges, it’s clear that the change is not completely water under the bridge. There is still a metaphorical waterfall of change ahead; dependent on how the post-COVID working world emerges. We’re already starting to see the shift due to early adopters, but the next 12 months will reveal the long-term impact more clearly.

Global Medical Trends


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