Features: November 16th, 2012

With pay freezes biting hard across public services it is becoming more difficult to recruit and retain talented people. James Malia explains how an innovative reward programme can make a difference.

Councils are having to adopt an innovative approach to reward the contribution of employees in order to help attract, retain and develop valued and talented staff members, thus ensuring they are equipped with the necessary skills and competencies to deliver high quality services to local people.

With a wealth of research confirming a link between reward and improved performance, many councils are finding that offering a good employee benefits package can be instrumental in supporting their recruitment, retention and engagement strategies, particularly at a time when pay rises and annual increments are not available.

West Lothian and Nottingham City Councils are currently delivering cost-neutral benefits packages to support their employee engagement drive.

West Lothian Council offer employee discounts, childcare vouchers and a cycle-to-work scheme to its staff. The Council provides the opportunity for employees to benefit from valuable savings on a wide range of services, whilst also being able to generate savings itself through reduced National Insurance payments.

We’ve helped West Lothian Council to deliver an employee benefits programme that best fits the workforce profile and caters for each individual employee, enabling everyone to profit from a variety of discounts and other financial benefits – without any expense to the Council.

Our partnership with Nottingham City Council has been established for approximately seven years now, and we provide its ‘Works Perks’ scheme. Over the years, the initiative has evolved according to the Council’s needs and we have fulfilled the ‘guarantee’ of a cost neutral solution.

Tara Bath, Reward and Retention Consultant, Nottingham City Council says: “The Council’s objectives to attract and retain talented people, support a committed and engaged workforce, and be an employer of choice are prominent. Implementing a high quality cost-neutral solution has helped us to achieve this.”

P&MM Employee Benefits has worked with Nottingham to include the HolidayPlus scheme within its employee benefits offering, allowing employees to purchase additional annual leave via salary sacrifice. This is a popular solution as the employer can reduce salary and National Insurance costs substantially, whilst employees gain extra holiday. Tara explains: “Since its inception, the scheme has seen various initiatives introduced, most recently the development of our holiday purchase scheme which has had the additional benefit for the council of driving savings that would otherwise have had to be found elsewhere, for example by cutting jobs or services. So by providing this option for our employees we are not only helping them to achieve a good work life balance and obtain additional leave at good value, but we are also supporting key business objectives by contributing to workplace savings. We have saved over £0.7 million on salaries and employers National Insurance through this scheme since launching.”

In addition, employer National Insurance savings are generated through this and the Council’s other salary sacrifice schemes, meaning that the cost structure ensures that each component scheme more than pays for itself from the employer National Insurance savings (the Council’s savings outweigh the provider’s fees). The fee structure is based on uptake, so everyone benefits from increased employee usage.

Furthermore, the National insurance savings made by the employer enable the Council to provide a comprehensive employee lifestyle discount scheme, as Tara comments: “This is a highly popular benefit, and because it helps raise awareness and usage of ‘Works Perks” as a whole, it also boosts uptake on the salary sacrifice schemes, thereby driving further savings for the Council – a very positive cyclical effect.”


Of course, a powerful regular programme of tailored communication is essential as employees must be aware of what is available to them. HR departments should ensure their provider offers numerous tools to communicate the advantages of the benefits package to staff effectively.

There are many ways to publicise a scheme to staff, including leaflets, posters and attention grabbing and engaging content for the intranet. Employers need to incorporate the communication of an employee benefit strategy within their overall plan as this ensures it is not forgotten. Organisations should use an appropriate variety of media to tell staff, perhaps on a fortnightly basis, about future offers. Regular communication, possibly in the format of monthly or six weekly meetings to refresh employees’ minds and offer the chance to fact find, also boosts the effectiveness of a scheme.

A competitive employee benefit package has significant power not only to attract the best, but also to retain them. For businesses today, loyal and productive employees are their ammunition and can impact on whether a company survives or flourishes.

Tara Bath explains Nottingham City Council’s approach to communication: “Integrating all of the employee benefits via a single provider, on a single web platform and all under the ‘Works Perks’ internal brand is of major benefit to the Council in being able to drive awareness (and therefore usage and uptake) of the salary sacrifice schemes.

“A scheme is only as good as the communication about it and we are fortunate to have a dedicated communication team who work closely with the benefits provider’s team to develop strategic plans to drive awareness of ‘Works Perks’ amongst colleagues. All scheme communication is centralised and the Council also has internal ‘Champions’ including some Trade Union Representatives, who help to raise awareness of the scheme in their local areas. We use posters and flyers, regular e-mail communication, promotional road shows at popular Council sites, plasma screens, internal magazine content, intranet bulletins and promotional videos to promote the benefits. All of our marketing uses straight forward language and high quality images that reflects the diversity of our workforce.

“The Council views communication of the scheme and the benefits of salary sacrifice as a continual, ongoing challenge. Colleagues’ personal circumstances are always changing, so to ensure that they always have a relevant and popular scheme, it is vital to continually communicate its features and benefits,” summarises Tara.

Looking ahead

As the repercussions of the recession seem set to continue, councils will increasingly seek ways to engage and retain their workforce, without creating a strain on financial resources – and employee benefits facilitate this by supporting and helping to improve the lifestyles of employees.

James Malia is head of P& MM Employee Benefits.
For more information visit: www.pmmemployeebenefits.co.uk