Is Your Employee Benefit Scheme Working? Here’s How to Find Out

shutterstock_162426023Why are you offering an employee benefit scheme?

To boost motivation? To attract the best applicants, improve retention and reduce staff turnover? To make sure you’re ahead of the curve if your legal obligations change?

Or maybe because you simply think that protecting (and rewarding) your loyal colleagues is the right thing to do?

Whatever your answer, the important thing is that you know how to measure the scheme’s success.

And to do that, you need a reliable way to work out employee uptake and perceptions of your scheme, as well as how it impacts on their behaviour.

Many companies simply choose and implement a scheme and consider this a fait accompli: it’s not.  You need to undertake regular reviews of your scheme’s performance to check that it continues to meet the needs of your workforce.

Since most schemes are renewed annually, this gives you a natural deadline to work towards.

There are two main indicators that you should look to when evaluating your scheme: what employees do, and what they say.

First: what they do. If the scheme is optional, how many people have actually decided to take it up?

Check out your data from before and after you introduced your scheme. How do the numbers stack up for employee absenteeism? How many people have quit? And, for hard financial figures, how much has HR had to spend on short term cover, or on recruitment drives to replace the staff you’ve lost?

Secondly, ask your employees what they think of the scheme and what changes they would like to bring in. What types of cover are they most concerned about? What perks would they be most grateful for? If they’ve chosen to opt out, ask them why. Presenting these questions in a survey format can help you to quickly collate the results and spot recurring trends.

This is also a great opportunity to remind your workforce of the benefits that are on offer and to explain the details of the scheme to any new recruits.

Seeking this information “straight from the horse’s mouth”, as it were, not only saves you the trouble of second guessing their opinions, it also encourages them to feel involved in the process, which can improve motivation, highlight your efforts and help to improve uptake and engagement with the scheme itself.

Taking the time to properly assess your scheme and respond to your employees’ needs has tangible benefits for your bottom line.

In a study conducted by The Benefits Research 2013, 41% of companies said that they made changes to their scheme based on employee feedback and requests. Promisingly, over four-fifths of respondents also reported that that their benefits packages were both an effective recruitment and retention tool, compared to just 60% and 53% respectively in 2011.

Regular assessment of your employee benefit scheme, it seems, doesn’t just keep your workforce happy. It actually helps to keep you on track to achieving your business goals, making it a valuable investment for your company’s future.

Want to talk to an expert you can trust about implementing an effective employee benefit scheme? Give our team a call today.

Get Started Today






How HR Managers can save €1000s on Life Insurance

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If you’re looking into group life insurance schemes for your company, chances are you’re in for a shock.

Quotes for the same product can vary enormously from provider to provider.

In fact, we recently contacted four of the largest insurance providers on behalf of a client with 250 employees, and were given quotes ranging from €40,000 to a staggering €80,000!

So how do you make sure that you’re not paying way over the odds?

As a starting point, there’s the question of how generous you, as the company, can afford to be.

Broadly speaking, there are two types of life cover that you can opt to provide to your employees: death-in-service cover and disability cover.

At the name suggests, death-in-service cover means that, if an employee dies, their next-of-kin receives financial support after their death. This takes the form of a single lump sum.

Disability cover, on the other hand, tends to be far more expensive.

This provides ongoing, regular income to an employee after a deferred period of time (usually 13-26 weeks), if they are rendered unable to work by a disability. Typically, payments are a set percentage of the employee’s salary, for example 75% or 66.67%, minus the State Illness Benefit – currently €188 for a single person.

Whether you choose to offer both types of cover is up to you; many companies only provide the former.

Then, there’s how generous you want the insurer to be.

Like any form of insurance, the higher the level of cover, the higher the cost.

The amount you spend on Death-in-service cover will vary according to how much your employees are paid and how much their families are set to receive if they die.

Typically, the size of the lump sum that a person’s next-of-kin receives is worked out as a multiple of the deceased employee’s pre-tax, basic salary. Depending on the policy, this could be anything from twice to twelve times the amount the employee earns – and the cost of the scheme will reflect that.

While you may want to reward longer-term or higher seniority employees with higher levels of cover, it’s worth asking yourself whether this is really a make or break issue for new starters.

Of course, life insurance is an attractive perk and many people like to tick it off the list when checking which benefits their prospective employer offers. However, there’s little evidence that talented applicants choose one company over another based on the actual size of their life insurance policy.

Is it really worth paying big bucks in order to make yourself mega-competitive in this area?

Other key considerations to bear in mind are the occupations of your employees and their age profiles.

Unsurprisingly, a manual-based older workforce push up your premiums.

While you can’t change these factors, paying close attention to the finer differences between suppliers’ policies can make a big difference to the final bill.

For example, if most of your workforce is young, a handful of more expensive premiums will have a negligible effect on the total, but if your workforce skews the other way, it can add thousands to your scheme. Make sure you shop around for policies that best serve the demographic of your company!

Trawling though this information can be a confusing experience.

The most reliable way to ensure that you’re getting the best deal is to work with a trusted advisor that knows the industry and can navigate this for you. They know exactly how to reduce life insurance costs.

It’s tempting to try and save money by doing it all yourself, but when prices vary so widely, scrimping on support and splashing on a sub-standard scheme is often a false economy.

Even SMEs and smaller companies can save thousands by choosing their policy carefully – and typically, that means shelling out on some expert advice.

It’s essential that the advisor you choose is 100% independent, has good inroads with the major insurance companies and is an excellent negotiator. You need someone who’s willing to do the hard graft needed to bring down the costs!

Do you have any tips or tricks for bringing down the overall costs of your group life insurance? Let us know in the comments section below!






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shutterstock_222294943When it comes to pensions, major changes have been taking place across the border.

While in Ireland pensions are still an optional employee benefit, provided at the company’s discretion, that’s no longer the case for our nearest neighbours.

Now, many observers are asking the very reasonable question: how long before Ireland follows suit?

And, just as importantly: how can I make sure I’m ready when it does? 

But first things first. What’s actually going on in the UK?

In 2012, the UK embarked on the path of auto-enrolment. Last October, it became a legal obligation for all companies with more than 60 employees to auto-enrol employees between 22 years old and the State Pension Age into a pension scheme, if they earn over £9,440 (€11,500) per year.

And, while it doesn’t have to happen automatically, they must at least offer a workplace pension scheme to all employees aged 16-74, or those earning under the threshold, if they ask for one.

By 2018, companies with 50 or fewer employees will need to get on board, too.

Once the dust has settled, employers will pay 3% of the individual’s gross earnings into the scheme, up to an income threshold of £41,450 (€50,500). Employees will pay 4%. This is being phased in gradually, though, up until the 2018 deadline.

While employers are obliged to auto-enrol their staff, individual employees don’t have to stay in the scheme. They can choose to opt-out by filling in a form. However, their bosses must keep re-enrolling them automatically every three years.

What’s more, companies that fail to comply with the regulations could face fines of between £50 and £10,000 a day, depending on how many employees they have.

And how’s it working out so far?

Pretty well, actually.

Auto-enrolments chief Charles Counsell has proclaimed the project so far to be a “success” and most UK companies seem to agree with him.

Research conducted last summer found that most employers were confident that the new rules were “manageable” – although, unsurprisingly, smaller businesses had more qualms.

80% of SMEs said that automatic enrolment was a “good idea” for their employees, compared to 86% of small companies and three-quarters of micro ones.

So what does this mean for you?

At the moment, the debate over auto-enrolment continues in Ireland

Big players like the benefits consultant Mercer are pushing the government hard to follow the UK’s lead. The OECD has been urging the country to adopt the approach for years.

Meanwhile, opponents like the Irish Association of Pension Funds say the whole pensions sector is in a mess and “there is a huge amount of work to be done before any type of auto-enrolment solution is introduced in Ireland.” 

But whether it happens sooner or later, the likelihood is that it will happen.

And the best thing a responsible, forward-looking company can do right now is to be ahead of the curve.

If you don’t currently offer your employees a pension, now is the time to start addressing the shortfall. To get you started, I talked about the different types of pension you can provide, and their comparative pros and cons, here.

Taking control of the situation by implementing your own initiative means that you can do things your way – while keeping your current employees happy and offering a great perk to potential new ones.

After all, as consultant Tracie Denson of Barclays Corporate and Employer Solutions puts it: “Nobody understands the business better than those who work within it.

“That said, we have also seen how easy it is for businesses to underestimate complexity of auto-enrolment and the time it requires.”

Want to find out more about how auto-enrolment could affect your business, or to talk to an expert about the best pension options for your team? Give us a call today.






How to Soften the Blow of Auto Enrolment

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Since auto-enrolment was rolled out in the UK in 2012, it’s becoming a hot topic for Irish businesses too – while we wait to find out if and when it’s likely to be introduced here, or not.

We take a closer look at how it could impact you if it is implemented – and what you should do, to soften the blow!

No neutral ground

Auto-enrolment has plenty of pros – and cons – it’s certainly not a topic you are likely to find neutral ground on, if you’re a business owner.

But did you know that less than half of employees in Ireland have a pension scheme?

It’s a concerning, but unsurprising statistic. Like a lot of other countries, employees in the private sector in Ireland have relatively low pension coverage and this is an attitude that has had businesses like Thesaurus call for a dramatic change on the savings horizon.

They’re pretty certain that putting a legal obligation on employers to enrol employees into pension schemes is the only way to tackle the looming pension problem.

What’s the likely impact?

So how could it impact you and your employees? Taking a look at how it has been implemented in the UK, as described in detail on the Public Policy blog, gives you quite a useful insight into what you could expect.

As a quick overview – it means that all employees must be offered a workplace pension scheme. While it would be completely compulsory on employers to offer it, employees themselves may have the choice to opt-out by filling in a form. But this is something they will need to do every few years – as employers will have to keep re-enrolling them!

There will be a minimum contribution for both employers and employees – currently at 3% and 4% respectively in the UK. While these contributions are gradually being phased in, this can translate to quite a sizeable amount of Euros – so is it possible to soften the blow?

Easing the impact

Auto-enrolment is, by definition, automatic for employees. But as the UK’s Pensions Regulator helpfully points out, it is not automatic for businesses, and it will take some time for you to prepare and ensure all eligible staff are correctly enrolled.

Thankfully, this is not something you would be expected to do overnight – they suggest a realistic timeframe of 12 months. In this time, you would need to make sure that any existing pension schemes you have in place are suitable for auto-enrolment, and that you’re fully compliant with all your duties. If it is introduced in Ireland, then auto-enrolment is most likely to see a phased rollout, which may allow a reasonable amount of time to adapt to it.

The biggest concern will be the minimum contributions required, from both employer and employee. To ease the transition, we could expect a gradual increase in percentages over a period, as has been the case in the UK. And as Real Business points out, this can offer employees quite an attractive deal, as their pension pot will soon start to grow.

But even with a transition period, this could still raise potential challenges for employers – so it’s important to consider a couple more issues that could soften the blow for you.

Firstly – find a suitable workplace pension scheme for you. You’ll need to ensure they are fully compliant with all legislation, but this can take a lot of the work out of the move for you, leaving you free to focus on your business.

Next – establish a clear plan and timetable. There will be a lot of key dates to note along the transition period, so it’s vital to make sure that you have reached each step along the way in a timely fashion. The last thing you want is to be caught out unawares!

What are your thoughts on the prospect of auto-enrolment in Ireland?

 

Let us know what you think!






Making a Business Case for Using an Employee Benefits Advisor

Simon Shirley's employee benefits advisors work tirelessly to help you find the perfect benefits schemes for your employees.

Recently, we talked about
the four signs that you might need an employee benefits advisor. From the amount of time that researching all of the different benefits plans takes to the often conflicting needs of employees and finding the right balance of plans and options, there are many reasons why an HR manager may need to employ the services of an employee benefits advisor.

Naturally, any decision regarding the use or allocation of company resources should be rooted in a sound understanding of the needs of the business and whether or not the return will be worth the cost. After making the determination to use an employee benefits advisor to assist you and your organisation in choosing and maintaining employee benefits schemes, it is time to make a business case for using said advisor.

How can a business case for using an employee benefits advisor be made? To answer this, we here at Simon Shirley Advisors have assembled a short list of ways you can justify the use of a dedicated benefits advisor in your business.

Business Argument #1: It Allows You to Focus on Increasing Productivity

Human Resources managers have a plethora of tasks to handle, from the recruiting, interviewing and hiring of new talent, to consulting with top executives for strategic planning, to the dozens of everyday interactions with employees designed to keep said employees happy, engaged, and working for your company instead of the competition. These tasks alone are enough to fill any HR manager’s day, and having to spend hours upon hours of time performing the kind of detailed research required to find an employee compensation and benefits scheme that balances the needs of all your company’s personnel detracts from your ability to dedicate time to your other duties.

By utilising the services of an employee benefits advisor, you can get a sampling of the top employee benefits packages that best suit your company’s needs and means. This saves you time on digging through the ever-changing list of available benefits packages yourself, time that you can dedicate to ensuring that employees are performing at their best.

Business Argument #2: It can Help Reduce Employee Attrition

One of an HR manager’s biggest concerns is to minimize employee attrition. Whenever an employee leaves, your company has to:

  1. Find a suitable replacement.
  2. Train said person for the role.
  3. Get that new hire settled in.

One of HR's most important tasks is to retain and develop a business' top talents.These activities all take time and money from your company. To find that one perfect replacement might take dozens of interviews. Even after a replacement is hired, it may take some time for this new person to become as proficient at producing value for the company as the staff member they’re replacing. Keeping employee attrition low helps to prevent dips in productivity and efficiency caused by a need to constantly cycle in new employees.

How does an employee benefits advisor help to reduce employee attrition? By helping to ensure that your company’s employee benefits and compensation schemes are up to par. In a recent study cited by business publication Inc.com, 74 percent of employees who leave their jobs cite “subpar benefits” as an annoyance factor that contributes to their decision to quit.

Keeping benefits schemes up to date helps to keep employees happy and working for you, and a dedicated employee benefits advisor can help you make sure that your company can deliver best-in-class employee benefits. Employee benefits advisors can make this task easy by checking your current benefits schemes against what is available on the market, managing existing plans to ensure the coverage of all eligible employees, and bringing to your attention any new schemes that may be attractive options as they become available.

Business Argument #3: It can save Capital

As was mentioned in the above section, the time and money that is spent on replacing lost talent with new hires can be higher than the cost of retaining the old employee.

How much more does it cost to find a new hire and get him or her up to speed rather than keeping an employee on staff? According to research by the Society for Human Resources Management, “direct replacement costs can reach as high as 50%-60% of an employee’s annual salary, with total costs associated with turnover ranging from 90% to 200% of annual salary.”

To illustrate the above example, say an employee makes €50,000 per year. If that employee leaves the organization, the cost to replace this person could be as high as €100,000 after you take into account lost productivity, training costs, and paying out the old employee’s accrued paid time off, among other expenses.

However, using the services of an employee benefits advisor can save your organisation capital in more ways than simply preventing employee turnover. By assembling a complete list of the available employee benefits and healthcare schemes on the market, your company get the best coverage for the money spent, and minimise liabilities from employees not being properly placed under the coverage. For example, not being able to collect on a key personnel insurance policy because that employee was not registered for the plan.

With the support of a dedicated employee benefits advisor, your company can save capital, improve employee engagement, and reduce employee attrition. Learn more by contacting Simon Shirley Advisors today.






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Is Your Employee Benefit Scheme Working? Here’s How to Find Out

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Why are you offering an employee benefit scheme?

To boost motivation? To attract the best applicants, improve retention and reduce staff turnover? To make sure you’re ahead of the curve if your legal obligations change?

Or maybe because you simply think that protecting (and rewarding) your loyal colleagues is the right thing to do?

Whatever your answer, the important thing is that you know how to measure the scheme’s success.

And to do that, you need a reliable way to work out employee uptake and perceptions of your scheme, as well as how it impacts on their behaviour.

Many companies simply choose and implement a scheme and consider this a fait accompli: it’s not. You need to undertake regular reviews of your scheme’s performance to check that it continues to meet the needs of your workforce.

Since most schemes are renewed annually, this gives you a natural deadline to work towards.

There are two main indicators that you should look to when evaluating your scheme: what employees do, and what they say.

First: what they do. If the scheme is optional, how many people have actually decided to take it up?

Check out your data from before and after you introduced your scheme. How do the numbers stack up for employee absenteeism? How many people have quit? And, for hard financial figures, how much has HR had to spend on short term cover, or on recruitment drives to replace the staff you’ve lost?

Secondly, ask your employees what they think of the scheme and what changes they would like to bring in. What types of cover are they most concerned about? What perks would they be most grateful for? If they’ve chosen to opt out, ask them why. Presenting these questions in a survey format can help you to quickly collate the results and spot recurring trends.

This is also a great opportunity to remind your workforce of the benefits that are on offer and to explain the details of the scheme to any new recruits.

Seeking this information “straight from the horse’s mouth”, as it were, not only saves you the trouble of second guessing their opinions, it also encourages them to feel involved in the process, which can improve motivation, highlight your efforts and help to improve uptake and engagement with the scheme itself.

Taking the time to properly assess your scheme and respond to your employees’ needs has tangible benefits for your bottom line.

In a study conducted by The Benefits Research 2013, 41% of companies said that they made changes to their scheme based on employee feedback and requests. Promisingly, over four-fifths of respondents also reported that that their benefits packages were both an effective recruitment and retention tool, compared to just 60% and 53% respectively in 2011.

Regular assessment of your employee benefit scheme, it seems, doesn’t just keep your workforce happy. It actually helps to keep you on track to achieving your business goals, making it a valuable investment for your company’s future.

Want to talk to an expert you can trust about implementing an effective employee benefit scheme? Give our team a call today.

hi

Press & Publications

Is Your Employee Benefit Scheme Working? Here’s How to Find Out

data

Why are you offering an employee benefit scheme?

To boost motivation? To attract the best applicants, improve retention and reduce staff turnover? To make sure you’re ahead of the curve if your legal obligations change?

Or maybe because you simply think that protecting (and rewarding) your loyal colleagues is the right thing to do?

Whatever your answer, the important thing is that you know how to measure the scheme’s success.

And to do that, you need a reliable way to work out employee uptake and perceptions of your scheme, as well as how it impacts on their behaviour.

Many companies simply choose and implement a scheme and consider this a fait accompli: it’s not. You need to undertake regular reviews of your scheme’s performance to check that it continues to meet the needs of your workforce.

Since most schemes are renewed annually, this gives you a natural deadline to work towards.

There are two main indicators that you should look to when evaluating your scheme: what employees do, and what they say.

First: what they do. If the scheme is optional, how many people have actually decided to take it up?

Check out your data from before and after you introduced your scheme. How do the numbers stack up for employee absenteeism? How many people have quit? And, for hard financial figures, how much has HR had to spend on short term cover, or on recruitment drives to replace the staff you’ve lost?

Secondly, ask your employees what they think of the scheme and what changes they would like to bring in. What types of cover are they most concerned about? What perks would they be most grateful for? If they’ve chosen to opt out, ask them why. Presenting these questions in a survey format can help you to quickly collate the results and spot recurring trends.

This is also a great opportunity to remind your workforce of the benefits that are on offer and to explain the details of the scheme to any new recruits.

Seeking this information “straight from the horse’s mouth”, as it were, not only saves you the trouble of second guessing their opinions, it also encourages them to feel involved in the process, which can improve motivation, highlight your efforts and help to improve uptake and engagement with the scheme itself.

Taking the time to properly assess your scheme and respond to your employees’ needs has tangible benefits for your bottom line.

In a study conducted by The Benefits Research 2013, 41% of companies said that they made changes to their scheme based on employee feedback and requests. Promisingly, over four-fifths of respondents also reported that that their benefits packages were both an effective recruitment and retention tool, compared to just 60% and 53% respectively in 2011.

Regular assessment of your employee benefit scheme, it seems, doesn’t just keep your workforce happy. It actually helps to keep you on track to achieving your business goals, making it a valuable investment for your company’s future.

Want to talk to an expert you can trust about implementing an effective employee benefit scheme? Give our team a call today.

hi

HR Managers: It’s time to get to grips with auto-enrolment

shutterstock_222294943When it comes to pensions, major changes have been taking place across the border.

While in Ireland pensions are still an optional employee benefit, provided at the company’s discretion, that’s no longer the case for our nearest neighbours.

Now, many observers are asking the very reasonable question: how long before Ireland follows suit?

And, just as importantly: how can I make sure I’m ready when it does? 

But first things first. What’s actually going on in the UK?

In 2012, the UK embarked on the path of auto-enrolment. Last October, it became a legal obligation for all companies with more than 60 employees to auto-enrol employees between 22 years old and the State Pension Age into a pension scheme, if they earn over £9,440 (€11,500) per year.

And, while it doesn’t have to happen automatically, they must at least offer a workplace pension scheme to all employees aged 16-74, or those earning under the threshold, if they ask for one.

By 2018, companies with 50 or fewer employees will need to get on board, too.

Once the dust has settled, employers will pay 3% of the individual’s gross earnings into the scheme, up to an income threshold of £41,450 (€50,500). Employees will pay 4%. This is being phased in gradually, though, up until the 2018 deadline.

While employers are obliged to auto-enrol their staff, individual employees don’t have to stay in the scheme. They can choose to opt-out by filling in a form. However, their bosses must keep re-enrolling them automatically every three years.

What’s more, companies that fail to comply with the regulations could face fines of between £50 and £10,000 a day, depending on how many employees they have.

And how’s it working out so far?

Pretty well, actually.

Auto-enrolments chief Charles Counsell has proclaimed the project so far to be a “success” and most UK companies seem to agree with him.

Research conducted last summer found that most employers were confident that the new rules were “manageable” – although, unsurprisingly, smaller businesses had more qualms.

80% of SMEs said that automatic enrolment was a “good idea” for their employees, compared to 86% of small companies and three-quarters of micro ones.

So what does this mean for you?

At the moment, the debate over auto-enrolment continues in Ireland

Big players like the benefits consultant Mercer are pushing the government hard to follow the UK’s lead. The OECD has been urging the country to adopt the approach for years.

Meanwhile, opponents like the Irish Association of Pension Funds say the whole pensions sector is in a mess and “there is a huge amount of work to be done before any type of auto-enrolment solution is introduced in Ireland.” 

But whether it happens sooner or later, the likelihood is that it will happen.

And the best thing a responsible, forward-looking company can do right now is to be ahead of the curve.

If you don’t currently offer your employees a pension, now is the time to start addressing the shortfall. To get you started, I talked about the different types of pension you can provide, and their comparative pros and cons, here.

Taking control of the situation by implementing your own initiative means that you can do things your way – while keeping your current employees happy and offering a great perk to potential new ones.

After all, as consultant Tracie Denson of Barclays Corporate and Employer Solutions puts it: “Nobody understands the business better than those who work within it.

“That said, we have also seen how easy it is for businesses to underestimate complexity of auto-enrolment and the time it requires.”

Want to find out more about how auto-enrolment could affect your business, or to talk to an expert about the best pension options for your team? Give us a call today.

Get Started Today






Reasons Why Your Company Needs Key Person & Shareholder Life Insurance

There are several reasons you'll want to have key person life insurance cover.For almost anyone, the topic of life insurance cover can be an uncomfortable one to discuss. However, life insurance can be a critical issue for businesses both large and small.

Why is key person life insurance important for businesses? Here are a few reasons why:

Reason #1: To Ensure the Survival of the Business

In many companies, there are one or more persons who are critical to the continued success of the business. For example, the owner of a small business or the majority shareholder of a corporation. Without these key persons, the business would cease to exist, or at the very least the ability to do business would be severely hampered.

Key person life insurance covers the business in case of the loss of an irreplaceable member of the company. When a key person covered by such insurance dies, the company is the beneficiary of the policy, and can use the money to make up the shortfall in operations until a suitable replacement can be found and brought up to speed. In this way, life insurance for key personnel helps to ensure the continued survival of the business.

Reason #2: To Pay Debts and Avoid Bankruptcy

Having life insurance for key persons can help your company avoid the path to bankruptcy.One of the major risks of a key person dying is that the company as a whole might die with them. In many cases, companies might have to file for bankruptcy, as they run out of funds with which to pay off debts such as bills, taxes, and payroll.

That last item in the list above is especially important as a means of keeping employees motivated. With key person cover, a company can let rank and file employees know that, in the event of the death of the company owner or some other person, their final paychecks/severance will be secure as there is an insurance policy in place to cover the expense. This gives other employees peace of mind so that they don’t have to worry about their financial future if one person’s health takes a turn for the worse.

Reason #3: To Reassure Investors

This is closely linked to reason number two for having key person cover. As much as employees like knowing that their severance packages will be funded in case the company loses a key person, investors like knowing that their investment is secure as well.

Savvy investors like to make sure that their bases are covered before pouring money into a business, which includes checking to see that measures are in place to retrieve their investment capital in case the business suddenly becomes nonviable. One such critical measure is key person insurance that can be used to pay back investors in case the company has to close following the demise of an operation-critical employee.

Having key person cover helps investors to make their investments with confidence in the knowledge that they’ll be able to recoup their investments in a worst-case scenario.

Who Needs to be Covered in Your Business?

Now that we know a few reasons why your business might need key person cover, who in the company should be covered? Naturally, you shouldn’t need key person cover for every single employee, as that would be a little excessive.

To figure out who in your company should be covered under key person life insurance, consider the following:

  • Who is responsible for your company’s direction?
  • How difficult would it be to replace this person?
  • How much value, on average, does this person generate for the company annually?
  • Does this person have personal contacts that enable your business’ operations?

The above are just a few examples of things that you might want to ask about an employee when considering if they should be covered under a key person life insurance policy.

For more information regarding key person and shareholder cover, contact Simon Shirley Advisors today, or check out our employee benefits options guide at the link below:






Six reasons to choose an Occupational Pension Scheme over a PRSA Plan

If you’re setting up a pension plan for your employees, deciding which one to opt for can be a challenge.

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The choice is often presented as one between more flexibility (Personal Retirement Savings Accounts) or a higher rate of contribution (Occupational Pensions Schemes) but, in reality, the options are far more complex.

Personal Retirement Savings Accounts (PRSAs) have already been around in Ireland for a while – since 2002, in fact. They’re designed to give you as much flexibility as possible when trying to save for retirement.

But, while they provide employees with an individually tailored plan, they often incur higher charges and restrictions that actually limit what an employee can do with their plan.

With this in mind, it’s not surprising that OPSs, which tend to carry lower direct costs and a higher contribution limit are the pension plan of choice for many employers.

Here are our top six ways that an OPS can trump a PRSA for employees:

  1. No benefit-in-kind tax for employer contributions

Under the PRSA system, employees pay a fairly hefty tax of 7% – sometimes even 8% – on contributions made by their employer. In an OPS, they pay no such tax at all.

  1. Gives employees more options on retirement

 While PRSAs are designed to give employees plenty of flexibility in how they save for retirement, when it comes to the range of options for taking those benefits on retirement, the OPS is the clear winner.

  1. No taxes on transfers overseas

Under the OPS system, if employees decide to transfer their pension plan to another country, no additional tax charges apply.

This gives the OPS a definite advantage over the PRSA, as providers of the latter are obliged to deduct income tax at an employee’s marginal tax rate from a transfer to an overseas pension plan.

  1. Easy to transfer in benefits from other plans

PRSAs are created on an individual basis, with a pension plan set up for each employee that they can take it with them – even if they change employment.

The drawback is that when they make the switch they can face restrictions and incur additional costs.

With an OPS, on the other hand, employees can transfer their pension value and benefits over to a new plan with a new employer, with little or no costs or restrictions.

  1. (Potentially) lower fees

The annual management charge for a PRSA generally starts at 1% – but, for an OPS, the management fees can be lower.

  1. Higher tax-allowable contributions for employees

Lastly, for employees that plan to make significant contributions to their pension plan, the OPS is the clear winner.

The PRSA limits include employer as well as employee contributions, which are taxed as benefits-in-kind. This means that the cut-off point for employee contributions that qualify for tax relief is much lower than for the OPS.

Clearly, both plans have their advantages. But, overall, an OPS structure often offers the most when it comes to the crunch.

That said, there may be specific reasons why a PRSA works better for your organisation, and it’s really worthwhile looking through them in detail to make sure you know exactly what to expect, before making your choice.

You can check out more about PRSAs in detail here and the OPS here.

Which do you think would work best for you? Have you already got an existing plan in place and are thinking of changing? Let us know what’s on your mind!






5 Things Your Boss Should Know about Pensions

There are many things to check when creating a company pension scheme for employees.In Ireland, and many other countries, companies use pension schemes as a tool for improving employee engagement and attracting top talents who have long-term employment plans with your organisation.

Today, we here at Simon Shirley Advisors wanted to discuss five things about pensions that we thought that HR managers such as yourself may want your boss to know about pensions when they are structuring or restructuring the company’s pension scheme(s), particularly for businesses within Ireland.

#1: Employees Have Options

In Ireland, employers are not legally obligated to provide employees with occupational pension schemes. There is, as stated by the citizensinformation.ie website, “positive government encouragement” to provide an occupational pension scheme to employees, but there currently exists no obligation to provide one. Please note that if your company does not provide an occupational pension scheme, it will have to provide access to some other pension planning option.

Even though your company may provide an occupational pension scheme, employees do not have to partake of the company’s pension plan. Instead, these employees can choose to engage in a personal pension scheme (otherwise known as a Retirement Annuity Contract, or RAC).

While it is possible for employees to maintain both an occupational pension scheme and a personal pension scheme at the same time, they cannot contribute to both plans for the same job. For example, say that Albert were to join the company’s occupational pension scheme, and only had that one job. In this instance, he could only contribute to his occupational pension scheme. If Albert were to start a side job at another company or start his own business (assuming such employment doesn’t violate any standing non-compete agreements with your company), he could then start a personal pension scheme and contribute to it based on his earnings from the other work.

#2: Employers Have Options

Employees can choose to use the company pension plan, or a personal retirement savings account, but not both for the same job.After 2003, a new kind of pension scheme became available to employers in Ireland who did not wish to contribute to traditional occupational pension schemes. This scheme, called a Personal Retirement Savings Account, or PRSA, can be used to either replace or supplement occupational pension schemes.

The existence of this option helps to give your company more flexibility in pension planning for its employees.

#3: Equality of Access for Part-Time or Fixed-Term Employees

However, while the option of using PRSAs can increase your company’s flexibility in handling pension schemes, it is important for upper management to keep in mind that it is necessary to provide their part-time and fixed-term workers equal access to any schemes that full-time workers doing similar work have access to.

As stated in the Pensions Authority handbook on how pension schemes work, “The Protection of Employees (Part-Time Work) Act 2001 and the Protection of Employees (Fixed-Term Work) Act 2003 require that there is no discrimination between part-time and fixed-term employees and their comparable full-time counterparts.”

For example, say that you have two workers in a construction company, one full-time, one part-time. Both do the same kind of work, so if the full-time employee gets a pension plan, then the part-timer should also have access to that same plan.

There is an exception to this rule, however. If the part-timer works less than 20% of the hours the full-timer normally works, then that worker does not need to be given the same pension plan options that the full-time worker gets.

#4: Pension Scheme Structures

For most companies in Ireland, the pension scheme provided will be structured as a trust. The other option, which is called a statutory plan, is set up by the legislation to provide benefits to employees in public-sector or semi-state owned legal bodies. So, unless your company is a state-owned one, you will most likely be using the trust structure for your company’s pension schemes.

As stated in the Selecting Member Trustees Handbook on the Pensions Authority website, a trust is an arrangement wherein “money is set aside in a trust fund, which is separate from the employer’s business, to finance the benefits payable to scheme members and their dependants.” Under the trust structure, the money paid into the trust is considered the trust’s asset.

Trusts, when created, should be established to ensure that members and their eligible dependents will receive the benefits they are owed regardless of whether or not the establishing business remains in operation. This involves carefully selecting trustees to manage the pension scheme and invest its assets so that members of the trust can receive their benefits regardless of the company’s financial health.

In fact, appointing trustees is a critical part of ensuring that your company meets all of its obligations under the Pensions Act.

#5: What the Competition is offering, and what is Available

Ultimately, the choice to offer a company pension scheme is one of the many tools that your company can use to attract and retain top-notch talent. This is one reason why it is absolutely critical to do some market research and find out what your competitors are offering to their employees. With this kind of research, your company can formulate a plan that will be competitive and attractive without being wasteful.

Without such research, your company might offer a plan that is too insubstantial to serve well as a means of tempting great workers to switch to your company, or one that consumes far more resources than is necessary to get the job done.

For this kind of dedicated research into such a key employee benefit, it can be very helpful to use the services of an employee benefits advisor, someone who has detailed knowledge of the different pension schemes that are out there, and can help you create a plan that is both cost-effective and competitive.

Learn more about employee benefits such as pension schemes, healthcare, and more in our free guide to employee benefits at the link below.






The Ultimate Comp and Ben Cheat Sheet for HR Managers

Doing research for employee benefits packages is a long, drawn-out process.As an HR manager, how can you find the best-in-class employee benefits packages that you need to ensure that your company can attract and retain the top talents in your industry?

You could start by engaging in hours upon hours of exhaustive industry research, combing through complicated benefits schemes one by one in a process that takes so long that by the time you finish, many of the benefits plans you’ve looked at have already changed, and new ones have entered the market as well.

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The HR Managers Guide to the Best Blogs About Pensions in Ireland

Knowing about pensions can help you establish the most effective plan for attracting and retaining top talent for your company.Every year, the rules and regulations regarding employee benefits such as pension schemes change. For many who don’t have extensive experience with managing human resources or a background in investment law, retirement planning, or finance, the ever-shifting landscape for pensions can be confusing and frustrating.

With so much changing from year to year, keeping up to date on information regarding pension schemes can be difficult. Thankfully, this task does not need to be impossible.

To help guide you to the information about pensions that you want to know, we here at Simon Shirley Advisors have cobbled together a short list of the best blogs to follow for pension advice in Ireland. In this list, you can find regularly updated blogs and news feeds that contain solid, actionable advice for pensions or important updates regarding legal decisions about pension schemes.

#1: The Irish Life Assurance Blog

Irish Life is a venerated veteran of the pension, investment, and life assurance markets, with many knowledgeable personnel with years of experience. Irish Life maintains a blog where they post important information regarding subjects such as changes to the state retirement age and how it impacts individuals, to overviews of the Irish pension industry.

#2: Pensions Law Ireland Blog

A blog published by A&L Goodbody’s pensions law department, the Pensions Law Ireland Blog highlights major case decisions related to pension schemes as well as many of the technical aspects of managing a pension fund, such as handling bankruptcy or pension adjustment orders.

Not only are there many good blog articles to read on this site to help build knowledge about pensions, there are also links to many other useful resources on their blog list page, such as the Department of Finance website and the Irish Institute of Pensions Management website.

#3: The Pensions Authority News Feed

For those looking to keep up with recent events in the pensions world, the Pensions Authority News Feed can be a useful resource.

This news feed updates frequently with new stories regarding important legal decisions about pensions in Ireland, such as active court cases, updates concerning how to file certain paperwork for pensions, and other major changes to pensions. Using the articles on this site, HR professionals and pensions managers can stay apprised of important changes and legal decisions that affect how pensions are operated.

Staying Up to Date on Pensions

Whether you’re an HR manager looking to stay ahead of pension information so that you can ensure that your company’s pension schemes for employees remain compliant and an effective means of attracting and retaining top talents, or you’re simply curious about how pension schemes work in Ireland and want to be well-informed, resources such as the ones in the above list can be very beneficial.

If you want to learn more about pensions in Ireland on your own, you can find lots of useful information on the Citizens’ Information website as well. Here, you can find current information regarding Personal Retirement Savings Accounts (PRSAs), Additional Voluntary Contributions (AVCs), and many other important factors that are a part of occupational pensions.

While researching everything regarding pensions and other employee benefits schemes on your own is very rewarding, you don’t have to go it alone. To get help quickly learning about pension schemes, life assurance, healthcare, and other employee benefits options, you can contact experts in these fields for advice as well.

Learn more by contacting Simon Shirley Advisors today.






4 Common Pension Myths Busted

There are a lot of myths regarding pension schemes and advisors, It's time to put the facts first.Everybody loves a good story. While sharing stories is a great way to confer important information to others, such as moral codes, rules, and the need for certain basic skills, not all stories are 100 percent accurate. However, these inaccurate stories gain popularity in the public consciousness, perhaps because they sound good or seem to make sense.

Unfortunately, when these stories or myths concern important financial decisions such as pensions, they can do real harm to people. This is why Simon Shirley Advisors have collected a short list of the most common myths about pensions to go over with your employees so that retirement won’t catch them unprepared. On top of being the right thing to do, going over retirement planning issues with employees helps to demonstrate your dedication to providing best in class benefits, driving employee engagement and retention.

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Tax Implications to Corporate Gifting HR Management Should Know

When giving a corporate gift, keep in mind the tax implications.Many people in HR management circles know the power of handing out gifts to employees. It sounds like a wonderful idea: “hey, Bob’s been a really great employee this year, let’s get him a (fill in the blank with a nonmonetary gift here) to reward him!” To be certain, rewarding employees who go beyond the pale for the company is a good idea. It demonstrates that you’re paying attention and that extraordinary effort will be recognized and rewarded.

However, when the next tax season rolls around, Bob might not like that big fancy whatever you got him as much when it shows up as a “benefit in kind” on his taxes that he has to account for as a part of his income. As it turns out, there are tax implications to corporate gifting that need to be taken into consideration, or else they might come back to surprise an employee unpleasantly later on.

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The HR Manager’s Checklist to Selecting the Best Pension Plan

If you're researching pension plans for your company on your own, there are a lot of things you'll want to keep track of.For many companies, choosing the right employee benefits package is a key strategy for attracting and retaining top talent. This is no less true of pension schemes than it is of healthcare, life assurance, or other employee benefits schemes.

To assist you in finding the right pension plan for your company’s employees, Simon Shirley Advisors has assembled a brief check-list to picking the best pension plan to help ensure long-term commitment from employees:

Item #1: Who Manages the Money?

An important first question to get an answer to is “who manages the money in the plan?” Naturally, your employees will want to know that their pension plan is being managed by responsible, reliable individuals, ones who have the experience and connections necessary to ensure that the plan outperforms over time.

This usually means that when your company is comparing investment managers, you’ll want to choose a global investment manager over a local investment manager. The global investment manager typically has access to more resources and possesses greater expertise than the local investment manager. This means that a global investment manager is more likely to deliver better results for your employee’s invested pension money.

Item #2: Is the Investment Strategy Appropriate for the Age Range of Your Employees?

Generally speaking, younger employees may be more suited to taking on high-risk, high-reward pension investment strategies that may have a high long-term pay-off. On the other hand, older employees who are closer to retirement are much more likely to want to have safe, stable investment policies in place that reduce the risk of their pension plan falling in value just before they enter retirement.

Balancing these opposing needs is important to making sure that there is buy-in from both sets of employees.

Setting up investment portfolios for each employee that start out with the high-risk, high-volatility approach and automatically switch over to lower-risk, more stable strategies as the employee nears retirement is one way to give your employees the best of both worlds.

Item #3: The Cost of the Pension Plan

Adding up all of the costs of your chosen pension plan can help you establish how much "fat" there is in the plan, and see if the rates are competitive.When HR managers are going over the different pension plans and methods (funded vs. unfunded, etc.) with upper management, the cost of a given pension plan tends to be one of the larger sticking points.

For any pension plan, it is important to know:

  • The management costs your company will incur.
  • What the administration costs of the pension fund are.
  • What the advisor fees will total.

Check these costs and compare them in all of the pension plans that you are seriously considering for your company. Are the pension fund’s costs competitive? Also, who’s paying for the costs of the fund? With pension funds, these fees can be paid by the employees’ funds, the employer, or even both.

Item #4: The Delivery

It doesn’t matter if your employees are on the best pension plan possible if the advisors who communicate the plan to your employees are poor at communication. The ability of the advisors to advise/inform employees regarding the specifics of their pension plan is critical. Without effective communication, employees are more prone to not seeing their pension plan as a valuable benefit, causing it to lose its efficacy as a means of attracting and retaining top talents.

A top-notch pension advisory firm will be able to do more than just advise on a suitable pension plan, they will be able to provide valuable advice and assistance to employees on a wide range of areas and should be seen as a trusted resource for employees to turn to.

Item #5: Access to Information

The availability and the quality of information provided to employees:

  • on-line access
  • Charting performance
  • Regular updates
  • 1-2-1 annual reviews with the advisor

These are just some of the things to bear in mind to ensure your employees have access to the relevant information.

Researching every pension plan out there can be difficult and time-consuming, but choosing a suitable pension plan can pay off in improved employee retention and productivity by providing employees a long-term reason to be invested in your company.

Of course, you don’t have to go through this process of intensive research and vetting alone. Using the services of a trusted advisor can help you make this process quick and easy, and help your employees transition from one set of benefits schemes to the next more easily.

Learn more about pensions and other employee benefits by picking up a free copy of our employee benefits eBook at the link below:






How Using an Employee Benefits Advisor Can Help Employee Engagement

Employee benefits are a core concern when trying to drive employee engagement.As an HR professional, attracting, motivating, and retaining top talents is a major concern. The costs associated with top-tier talents leaving the company are extensive, sometimes costing more than the lost employee’s annual salary.

Finding ways to address issues that are obstructing your efforts to engage employees can be a challenge, but there are ways to make this task easier on yourself, such as by leveraging the services of an employee benefits advisor.

How can an employee benefits advisor help you drive employee engagement, you ask? To help answer this question, we here at Simon Shirley Advisors have assembled a list of ways that an employee benefits advisor can help you drive employee engagement so that you can retain and attract top talents while keeping them at peak productivity.

#1: Providing Top-Notch Employee Benefits Schemes

First and foremost, an employee benefits advisor can help you find, evaluate, enact, and manage best-in-class employee benefits schemes for your employees. These specialists are dedicated to the task of keeping up to date with the latest benefits plans, such as for healthcare and pension.

An employee benefits advisor will do the research for you, leveraging years of experience and an in-depth knowledge of what plans are available, what your company’s budget is, and what your competitors are offering so that your company can have the most attractive set of employee benefits packages available without going over budget.

When employee benefits schemes are not up to standard for the industry, they become an annoyance factor that can contribute to disengagement among employees. With the right benefits schemes, you can create an incentive for employees to remain with your company, and even attract top talents from other organisations.

#2: Managing Implementation of a New Benefits Scheme

There's a lot of paperwork to consider for each employee when transitioning from one benefits scheme to another. An employee benefits advisor helps make the process pain-free.An employee benefits advisor does more than simply handpick a few of the best benefits schemes available at the time, they can also help you with the implementation and management of said schemes.

One of the biggest problems that employees have with their benefits schemes occurs when the company switches from an old benefits scheme to a new one: individuals getting passed over or missed during the process of signing up for the new benefits scheme.

For example, say that Bill from accounting gets accidentally missed during the new signup period for the updated healthcare programme. Unfortunately, Bill is not aware of this fact, and thinks that he’s been on the new plan just as long as every other employee in his department when he goes to redeem his medical benefit for a routine doctor’s visit, only to be told that he hasn’t been on the plan long enough (or is not on the plan at all), and has to pay out of pocket for that doctor’s visit. Naturally, this can lead to some frustration.

An employee benefits advisor can help you prevent problems such as this by handling the process of implementing the new benefits scheme for you. This minimises the risk that employees will fail to be signed up for the new benefits scheme, and make the process less disruptive for employees.

#3: Working with Your Employees after the Fact

Other than not being signed up for a new benefits scheme in a timely manner, one of the other major issues that frequently leads to employees being frustrated with a company’s benefits schemes is that the new rules for redeeming their benefits or the structure of the plan is unknown to them. Even if a benefits scheme has great benefits on paper, it will not do much good if it is too difficult for employees to navigate the scheme and redeem their benefits.

This is where an employee benefits advisor can be invaluable to boosting employee engagement. A benefits advisor is an expert in handling issues related to employee benefits. Using this expertise, the benefits advisor can walk your employees through the processes needed to take full advantage of their benefits schemes.

When employees know how they can get the most from their benefits programme(s), they are much more likely to see the value in the programme and see it as a motivational factor.

Beyond providing advice for using your company’s benefits schemes, an employee benefits advisor can also provide other forms of assistance. For example, Simon Shirley Advisors compensation & benefits experts also provide personal financial planning information, advice, and related services for your employees on a one-to-one basis, helping them create a solid financial plan for their future with your company.

Learn more about how you can leverage the services of an employee benefits advisor to maximise employee engagement in your company today!






Crouch, Touch, Pause, Engage!…4 Stages of Employee Engagement

Do you know these four rules to employee engagement?

The 6 Nations Championship is almost upon us, it always brings an air of excitement to the beginning of Spring and gives us rugby supporters something to look forward to. 

A thought occurred to us in Simon Shirley advisors as we look forward to this seasons 6 Nations that linked the now familiar cry of the referee of Crouch, Touch, Pause….Engage! to the challenge of the HR Manager driving employee engagement.

What do employee engagement and a rugby scrum have in common? It is an unusual question, to be sure, but bear with us for a bit.

While the pause phase of the scrum has been removed from the rules in recent years to speed up the process, we’ll keep it here, as it applies to today’s topic of the four rules of employee engagement.

So, how do the old pre scrum laws apply to employee engagement? Here are the four laws of employee engagement, as inspired by the rugby scrum:

Crouch

In driving employee engagement, preparation is key. When you’re looking into ways to drive engagement among employees, you need to get ready, much in the same way rugby players get ready during the scrum’s crouch phase.

Checking the state of employee engagement among your workers takes time and effort, but it can be well worth it to identify the cause of disengagement amongst your workforce. By preparing ahead of time, you start your efforts to address engagement with an advantage that can help you take more effective measures to engage employees.

Failure to prepare can lead to actually doing more harm than good, just as a scrum that is not properly executed leads to increased risk of player injuries.

Touch

When trying to drive employee engagement, putting yourself beyond arms reach is not likely to inspire trust and engagement. Sometimes, the best way to find out what is obstructing engagement is to go to the trenches and engage with front-line workers.

As an HR manager, reaching out to employees to identify their biggest frustrations is key to handling employee engagement issues that could be limiting productivity. For example, do employees feel that they are being denied the basic tools needed to do their jobs? Or, are they frustrated with a lack of communication from management where project goals are concerned? Perhaps they feel that the employee benefits schemes used by the company aren’t right for them.

By getting in touch with employees, you encourage better coordination, and can help to eliminate causes of disengagement.

Pause

After you’ve done your prep work and started to diagnose the causes of disengagement in your workforce, take a brief breather to go over your initial findings.

Examine your options for driving engagement, and try to come up with strategies for doing so quickly and efficiently, just as a forward in a rugby scrum tries to find ways to get the ball to his team’s backend as quickly and efficiently as possible to keep the other team from getting ahead.

Taking a time-out to examine your options can help you find the best solution by allowing you time to make a choice based on a thorough assessment of the merits of the plan. This, in turn, helps you avoid making rash, knee-jerk reactions to an issue that you might regret later.

Engage

After proper preparation, identifying the issues blocking employee engagement, and carefully planning your response to said issues, it’s time to put your plans into action and kick the ball back to the rest of your team.

With the right approach, you can reliably improve employee engagement so that your company can attract and retain top talents and keep your employees working at peak efficiency.

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We hope you enjoyed the post and this years 6 Nations Championship. 

Learn more about how you can drive employee engagement in your company with the help of Simon Shirley Advisors today!

Naturally, everyone here in the Simon Shirley Advisors office is rooting for our own Irish team to win the 6 Nations Championship to repeat last year’s win.






Top 5 Things Management Wants to Know about Employee Engagement

Your company's upper management will have a lot of questions about employee engagement, it's important to have answers.Here on the Simon Shirley Advisors Blog, we have frequently discussed the importance of employee engagement in our more recent posts. While many HR personnel recognize the need to keep employees engaged and motivated at work, upper management may need some convincing.

To help you build a case for building employee engagement, here is our list of things your boss wants to know about employee engagement:

#1: How Does Engagement Affect Productivity?

Engaged workers put forth more discretionary effort than disengaged workers do. How much extra effort? According to research by Gallup, business or work units that are in the top 25% of their organisation in employee engagement have “21% higher productivity” than business or work units in the bottom 25%.

This improved productivity could be the result of numerous other synergistic factors associated with motivated workers, including:

  • Reduced absenteeism.
  • Lower turnover.
  • Reduced safety incidents.
  • Fewer quality incidents.

Work units that have employees who are frequently absent are effectively understaffed each time someone calls in sick or skips work unannounced. This problem is compounded when employees quit, which incurs not only reduced labour for that work unit, but extra training costs and reduced productivity as a new employee is eased into the role that was just vacated. Accidents also serve to remove employees from the workforce, either for short or long durations. In manufacturing industries, quality incidents lead to rejections, which necessitates the remaking of a product, lowering productivity.

Because motivated employees show up for work consistently, are less likely to quit, pay more attention to their work (enhancing on-the-job safety), and make the extra effort to ensure quality standards are always met, productivity is improved.

#2: What’s the Cost of Disengagement?

Disengaged employees are an enormous strain on productivity profits, a weight that slows your company down.As reported by Gallup, in the UK, “26% [of workers] are actively disengaged.” Actively disengaged workers are those workers who are classified as working against the companies interests. They are more likely to skip work, steal from the company, and drive employees around them to do the same.

Across the Atlantic Ocean, the USA has an estimated 18% “actively disengaged” workforce, and it is costing their economy “between $450 billion to $550 billion each year in lost productivity” (roughly €467.4 billion). Note that this figure is just for the “actively disengaged” employees, and does not include the employees who are merely “disengaged” that account for 52% of the United States’ workforce.

For the year of 2013, the US’s total GDP was $16.7 trillion (about €15 trillion), according to the World Bank. Divide 550 billion by 17.6 trillion, and the 18% of actively disengaged workers in the USA cost that country 3.1% of its total GDP across all of the country’s producers.

Imagine what percentage of your company’s earnings that disengagement could be costing you when the average rate of actively disengaged employees for the UK is 26%.

#3: How Can We Drive Engagement?

After discovering the steep costs of employee disengagement, the upper management personnel in your organisation will probably want to know how your company can drive employee engagement.

To be truthful, there are many things your company can do to engage employees so that productivity will increase and turnover, absenteeism, and the like will decrease. The specific steps that your company takes will depend largely on the cause of disengagement among employees.

One thing that many employers might think of when it comes to engaging employees is employee salaries, which brings us to our next question.

#4: Do We Need to Increase Salaries?

More money does not necessarily lead to more engaged employees.In many cases, increasing employee salary is not the answer to employee engagement issues. Addressing obstacles to employee engagement such as disputes between managers and employees or confusion about work duties can be much more important and effective at improving employee engagement compared to simply handing out bigger paychecks.

Another strong element in driving employee engagement is the benefits scheme that your company offers. A competitive benefits package that compares favorably against industry competitors can help motivate employees to remain with the company, and even attract top talents away from competitors.

Keeping your employee benefits schemes up to date so that they are competitive with or favorable to those of your competitors can be a highly effective means of attracting and retaining talent.

While salary is important, as employees do need to be fairly compensated for their time and effort, it is not necessarily the root of the problem when it comes to disengaged employees.

#5: Can We Get a 100% Engaged Workforce?

To be honest, the answer to this question is probably no. As reported in an article on Inc.com, even companies scoring in the top 10 percent on employee surveys “register only about 38 percent of their employees as ‘fully engaged.’”

Although a 100% employee engagement rate might not be realistic, working to ensure that you have more actively engaged employees than actively disengaged ones is well worth the effort. By driving employee engagement, you can minimise the number of actively disengaged employees that detract from your company’s overall productivity.

Learn More about Driving Employee Engagement

To find out how you can drive employee engagement with better benefits, contact Simon Shirley Advisors today.






Why Having an Employee Benefits Advisor is better than doing it yourself

How competitive is your employee benefits package with your competitor's? An employee benefits advisor can help you find out.For a human resources manager, maintaining employee engagement is an important task, as engaged employees are more productive and less likely to quit prematurely. Engaged, motivated employees put forth greater discretionary effort and even promote the company’s brand during off hours, acting to entice other talented individuals to join your company.

One key strategy for driving employee engagement is to create and maintain attractive employee benefits schemes. With great benefits schemes, you can attract and retain top-notch talents in your organisation more easily. Because of this, many HR managers work hard to maintain great benefits schemes for their employees, often all by themselves.

While dedicating so much time and effort to maintaining your company’s employee benefits programmes is commendable, as an HR manager, you often have many other responsibilities to take care of on a weekly or even daily basis, such as:

  • Payroll
  • Hiring staff
  • Organizing paid time off
  • Training
  • Consulting employees

The above list only names a few of the job responsibilities that many HR managers might have.

Rather than going it alone, you can take advantage of the services of a dedicated employee benefits advisor to help you manage employee benefits schemes for your company. Why is it better to have an employee benefits advisor as opposed to not having one? Here are a few reasons to consider:

#1: You Receive Specialised Help

One of the key advantages that a benefits advisor has is the fact that such a person is specialised in researching, acquiring, maintaining, and consulting employees on the different types of employee benefits programmes that are available in your region. The advice of a dedicated expert can be invaluable because such experts dedicated all of their time to knowing everything they possibly can about benefits schemes.

An employee benefits advisor studies each of the different benefits schemes available to your company, assessing each in detail for potential problems or unintended benefits that might be missed during a more cursory examination. This can prevent unexpected complications further down the road.

#2: You’ll Save Time and Resources

Getting a little help from a specialist frees you up to handle tasks, allowing you to get more done with the time you have.Researching the many different pension, healthcare, and other benefits schemes available on the market takes a considerable amount of time and effort. In many cases, by the time that a busy HR manager is able to complete in-depth assessments of multiple benefits providers, the offerings of one or more of those providers has changed. On top of that, the time you spend on research is time taken away from your many other responsibilities.

A benefits advisor can do the research for you, finding the best options to meet your goals within your company’s budget so that instead of having to dig through hundreds of different plans, many of which would be wholly incompatible with your business, you can simply look at a short list of your best options. This saves you time on research, freeing you up to handle other responsibilities.

Beyond simply providing you options, a benefits advisor can also research what benefits your competitors are providing to their own employees so that you know whether or not your own programmes are competitive enough.

#3: Assistance in Implementing and Managing new Schemes

Changing over from one set of benefits schemes to a new set of schemes is trying even in the best of times. Employees have to be moved off of the old programmes and onto the new ones, and there cannot be any problems with the paperwork during the transition, or else an employee might find themselves unable to use the new benefits that they think they have when they should be able to.

Gaps in coverage for individual employees can quickly cause intense frustration, leading to an increased likelihood of turnover. Having an employee benefits advisor can prove to be an enormous boon in making sure that no employee is left without cover for healthcare or is accidentally left without access to a pension scheme to which they may be entitled.

Beyond simply making sure that every “i” has a dot and every “t” is crossed, an employee benefits advisor can help by going through briefing sessions with employees to make sure that understand the changes to their benefits schemes, what is different, what is unchanged, and what their own responsibilities will be.

#4: Continuous Evaluations

Feedback is important to the process of providing best in class benefits. Employee benefits advisors help you collect and use feedback to improve your benefits schemes.Even after you’ve implemented your new benefits schemes, an employee benefits advisor can perform periodic evaluations of how your benefits schemes are being implemented, both from the perspective of the employer and the employees. This allows for you to have information on how well the new benefits packages are addressing the needs of your company and its employees, and where there is opportunity for improvement.

When the time comes to renew your benefits schemes, an employee benefits advisor will once again do research on the employee benefits market to ensure that the costs for your benefits schemes are in line with the industry’s competitive market rates. If they aren’t, or if the benefits schemes themselves have become outmoded, an employee benefits advisor can work with you to modify your benefits schemes to be more effective within the current market.

Learn More from Simon Shirley Advisors

Employee benefits advisors from Simon Shirley Advisors work hard to make sure that your employee benefits programmes are the best that they can be for the right cost for your company. Beyond the advantages listed above, a Simon Shirley Advisors benefits advisor can provide personal financial planning information, advice, and services to your employees on a one-on-one basis, helping to prepare said employees for their financial future.

To discover more ways in which an employee benefits advisor can help your company attract and retain talent, contact Simon Shirley Advisors today.






Simon Shirley Presents: Solving 2 Big Employee Engagement Problems

Engaged, motivated workers who love their work are much less likely to leave the company early, and provide more value as well.In recent posts, we’ve talked a lot about what some of the biggest problems to driving employee engagment are. Today, we here at Simon Shirley Advisors wanted to discuss some methods that you can use to solve the biggest employee engagement problems so that your company can have a motivated, dedicated workforce, and you can meet your goals for keeping your company’s best talents in place and drawing the top talents from other companies to your own.

Employee Engagement Solution #1: Creating a Plan for Advancement

There’s a common question in many new hire interviews: “where do you see yourself in five years?” It gets used primarily as a boilerplate personality question, something to help the interviewer (usually a manager or member of HR) determine the level of ambition that the prospective hire possesses.

In many cases, a new hire fresh from college might not have a clear plan of where he or she will be half a decade from now, while many others may have a very specific vision of where they want to be. In fact, there are many articles on how to answer this question “correctly,” which leads to misleading answers being given from time to time.

However, there’s one thing almost no driven, productive hire will ever say: “stuck in the same job with no prospects for advancement.” Before even applying for the job, many top talents will research your company and the opportunities for advancement. If the prospect doesn’t see an opportunity for advancement, then he or she will move onto the next company on the list.

To attract these talents, and keep them after they join the company, there needs to be a clear, well-established method for attaining advancement within the company for these long-term planners to latch onto. Creating such a plan will, naturally, require close coordination and planning with different levels of management, examining the rate of churn for different positions within the company, and creating contingency plans for when employees leave the company due to retirement or other factors.

One great indicator of opportunities for advancement is the establishment of training incentives and programmes that encourage employees to learn skills that are needed to fill higher-level positions in the company. By doing this, you not only demonstrate that your company supports plans to advance employees from within, you also create a pool of ready-made replacements for if someone in a hard-to-train-for position ends up leaving the company suddenly, minimizing the time that position spends unfilled.

Employee Engagement Solution #2: Ensure Goals are Well-Defined and Achievable

Goals and performance targets need to be clearly worded to avoid confusion. If employees don't know their goals, then it will be much more difficult for those employees to meet their goals.One common problem with employee engagement noted in research cited by a Fast Company article states that “only half of people surveyed have clarity on what’s expected of them.” These employees have no clear idea of what they need to be doing to meet goals, and their performance suffers as a result.

Consistently missing goals because they are vague or unachievable can quickly become frustrating, which leads to disengagement with work as attempts to meet goals become seemingly futile in the eyes of workers.

From time to time, it might be necessary to sit down with upper management team members and review the performance goals being set for employees. During these meetings, examine:

  • Success rate for meeting goals across the company.

  • Clarity and objectivity of goals.

  • Whether or not employees have the tools they need to meet goals.

  • Employee perception of how meeting goals affects the company.

While there are many more metrics you might want to review with management, these ones are important to your performance goal planning specifically. The rate of success for employees to meet goals helps you determine whether or not there is a significant problem with your goals in the first place.

If goals aren’t being met consistently across the majority of the organisation, a reevaluation of goals may be necessary. Reworking goals so that they are based on hard performance figures can do a lot to improve results, as such goals are clearer and employees will be better prepared to try and meet them. Goals not based on performance metrics such as “improve communication with team leaders,” while certainly a good idea, are hard for individual employees to act on and demonstrate, or relate to business goals.

After re-examining employee goals, how are employees equipped to meet these goals? When employees lack the training, tools, and support needed to meet goals, they may feel that they were set up to fail. Ensuring that employees have the training and the tools necessary to meet goals consistently helps them produce value for your organisation and keeps them motivated and engaged.

Learn More Solutions from Simon Shirley Advisors

The potential obstacles to gaining complete employee buy-in to your company’s goals are legion, and there are many possible solutions which might work in one situation, but not for another. To get more solutions to common challenges in driving employee engagement so that you can retain your top talents and make them more productive, contact Simon Shirley Advisors today.






HR Management: Top Reasons Why Employee Engagement is Such a Challenge

The obstacle between you and creating a team of engaged, motivated workers can feel like a maze. Maybe it's time to clear a path.For HR managers, ensuring that employees are engaged with their work is not only a job, it is a constant struggle, one where your success can mean a huge difference in your company’s ability to meet goals and remain successful.

One question that many HR managers and business owners have is “why is employee engagement such a challenge?” Despite their best efforts, these professionals have to continually struggle to motivate their work force to operate efficiently. Are workers unmotivated because they’re not being paid enough? Or, is there some other obstacle between your work force and engagement with their work?

Today, we wanted to discuss a few of the major reasons why employee engagement is such a tough challenge.

Reason #1: Employee to Management Relations

Look up “reasons why people quit their jobs” or “why employee engagement is low” in your search engine of choice and odds are that most of the top articles you find will discuss employee to manager interactions (or a lack thereof) as a major contributing factor to disengagement.

Numerous studies have shown a strong correlation between employee disengagement at work and working relationships with their direct reports. In one study featured on custominsight.com, it was revealed that “problems with direct supervisors account for 49% of the most disengaged employees.” That’s right, nearly half of any given company’s most disengaged employees are disengaged because of poor relations with their direct reports.

However, even within this category, there are many different reasons why an employee might become disengaged. These problems may include:

  • Overbearing levels of micromanagement.

  • A lack of communication.

  • Interpersonal issues not directly related to work.

The above are but a few examples of issues that can be an impediment to employee engagement where management interactions are concerned.

Fixing manager/employee relations is no simple task, and as such will take a considerable amount of time and effort to diagnose and correct. The time-consuming nature of this task is one reason why fostering employee engagement is a challenge.

Reason #2: Poor Work/Life Balance

Younger generation Y employees have a particularly difficult time achieving a healthy work/life balance that keeps them engaged at work.Another commonly-cited reason for employee disengagement is a lack of a proper work/life balance for employees. When employees work too many hours for too long, burnout and disengagement are almost inevitable.

As many organisations such as Employers for Work-Life Balance note, this is especially challenging with so-called Generation Y or “millennial” workers, as they “care more about work-life balance but see less of a clear distinction between their day in terms of their work and personal lives.” Workers from this generation want a proper work/life balance, but have a hard time achieving it because they find it difficult to “shut off” during their non-work hours, spending time checking their work emails and responding to requests.

One of the biggest challenges facing companies as a whole is finding ways to provide workers with an adequate work/life balance, mainly because different individuals will have different conceptions of what a “good” work/life balance is. Even when a single employee has an idea of what their ideal work/life balance is, that opinion can change over time.

As an HR manager, creating plans for making sure that employees use their leave smartly and do not become overworked can be a daunting task.

Reason #3: Issues with Benefits Policies

Many companies use their benefits packages (such as pensions, health care cover, etc.) to help attract and retain talent. However, when these benefits packages are incomprehensible, outdated, or inconvenient to utilise, then they lose their value as tools for driving employee engagement.

Periodically reviewing your compensation and benefits programmes to make sure that they’re useful, relevant, and comprehensible to your employees can be a great tactic for making your comp and ben packages more impactful as drivers for employee engagement.

Beyond reviewing existing policies, it can be helpful to organize meetings with employees who have questions or concerns regarding their comp and ben packages to explain their uses, how they can be accessed, and other important details. This task can be delegated to employees’ direct reports after you coach these direct reports a little to make sure that they themselves understand your comp and ben packages.

When comp and ben policies are outdated or lack impact in comparison to your industry competitors, then they become another reason why top talents may consider leaving your company to go over to a competitor. In light of this, keeping your benefits packages and policies up to date is a crucial task.

However, constant research into the market, what the competition is doing, and what the best benefits packages for a given level of cost are can be an enormous time sink. Thankfully, there are ways to get this research done while minimising your time investment, such as by utilising the services of a dedicated employee benefits advisor to do the research for you and provide you with a list of the best in class options and what is most compatible with your company.

To learn more about the biggest challenges facing HR managers in ensuring employee engagement, and how you can use employee benefits programmes to address these issues, contact Simon Shirley Advisors today.






How To Drive Employee Engagement on a Budget – 4 Tips

Managing a budget for human resources efforts can be a huge challenge.For human resources managers, the struggle to keep employees engaged with their work is never-ending. As shown in multiple studies such as the “Linking People Measures to Strategy” study by the Conference Board of Canada, employees who are engaged with their work are more productive, putting in more time and effort to help the organisation that they work for meet goals.

However, as important as driving employee engagement is, there never seems to be enough room in the budget for all of the measures you want to employ for your company. Working within frequently tight budgets to maximise employee engagement at work to drive productivity and retention of key employees is a challenge, but not one that should be insurmountable.

So, how can you drive employee engagement on a budget? To answer this question, we here at Simon Shirley Advisors have assembled a few tips to keep in mind while you work to drive employee engagement for your company.

Tip #1: Differentiate Between Employee Happiness and Engagement at Work

One thing that many people forget is that employee satisfaction and engagement are not necessarily one and the same. As pointed out by the Harvard Business Review, “Employees who say they are ‘satisfied’ may or may not feel engaged.” While there is a high correlation between satisfaction and engagement, the two metrics are different, and should be tracked separately.

So, when looking for ways to drive employee engagement, consider whether the measures you take are designed to keep employees “happy,” or they’re designed to foster productivity.

Tip #2: Give Employees a Sense of Ownership/Control

How much impact do individual employees have on the projects they are responsible for? Is there a sense of control, of responsibility among front-line employees?

When employees feel that they are important, that their input and results matter, they are much more likely to be engaged with the work that they do. You can create a sense of ownership among employees by:

  • Relating to employees how their performance impacts results for the company.
  • Taking suggestions from employees on how to improve processes.
  • Basing bonuses on the efforts of individual work cells rather than entire departments/divisions of the company, if applicable.

The first bullet point highlights for employees how their work affects not only themselves, but all of their coworkers, instilling a sense of responsibility towards their fellow front-line workers.

The second bullet point is a way for you to demonstrate to employees that their input matters, and may even give you a few good ideas for improving processes to maximise efficiency. Employee engagement rises when the employees have a sense of involvement in the decision-making process.

The final bullet point is primarily applicable for companies that have a performance bonus programme already. With a company or department-wide bonus programme, whether or not a specific team of employees gets a bonus is dependent on the performance of hundreds or thousands of employees who are not a part of their work cell. This takes any sense of control over the ability to earn a bonus out of the employee’s hands. With bonuses based on the performance of an individual or a small team of workers, there is a greater sense of control over the ability to earn said bonus.

Tip #3: Identify and Eliminate Driving Factors for Disengagement where Possible

Fostering employee engagement and cooperation can help to boost productivity, morale, and revenues for your organisation.

One way to help drive employee engagement at work is to root out the obstacles to engagement that may be in place and find ways to minimise or remove them.

What are these obstacles, and how do you remove them? The answer to this question may change depending on the nature of your organisation and your corporate culture.

One of the most common obstacles to employee engagement, however is poor relations with management. Poor relations with management might not be the result of “bad management” per se, but an inability for employees and management teams to communicate with one another.

Fostering communications so that managers and front-line workers can help to drive engagement and keep employees working towards meeting important goals. This can often be accomplished simply by meeting with management personnel and periodically reviewing their communication practices with employees.

Review the turnover rates for employees who work under specific managers. If one manager has an unusually high rate of turnover, that may be an indication of a problem. Focusing your efforts on managers of teams with high turnover rates can help you identify issues with management that are causing employees to become disengaged, and thus more likely to leave the company.

Also, take time each year to review your company’s HR and benefits policies in general. Pay particular attention to any policies for which you have received complaints from employees, and find ways to clarify the policy for workers, or to change the policy itself if local regulations permit. Sometimes, altering or eliminating a confusing, outdated, or obstructive policy can remove a significant obstacle to employee engagement, and thus, productivity.

Tip #4: Interview Engaged Employees

Rather than focusing on problem areas in your organisation, you can examine those employees/teams in your organization that consistently produce superior results and try to find out what these teams and their managers are doing differently from the rest.

Here, you can find ideas for increasing engagement that may not need to rely on using a large amount of company resources/capital.

Also, you can share the success stories of these employees in your company newsletter/memos. Doing this shows other employees how superior effort is recognized by the organisation as a whole, and can help to drive competitiveness amongst teams as they try to be the next team featured in the newsletter.

For More Information

With the above tips, HR managers can help to improve engagement among employees, without necessarily needing to spend a huge amount of capital.

Driving employee engagement helps to boost productivity, reduce turnover, and increase revenue for many companies in a variety of industries. To get more tips for driving employee engagement on a budget, contact Simon Shirley Advisors today.






Communicating Employee Benefits in Kind Rules for Corporate Gifts

When it comes to communicating important policies and rules to employees, standing in the street with a megaphone just doesn't seem to cut it.With the Christmas holiday being almost upon us, we here at Simon Shirley Advisors thought that it would be a good time to discuss a serious topic: corporate gift giving. Many offices in the UK and other countries around the world take time to organize events such as Secret Santa gifting, office parties, and corporate bonuses near the end of the year.

What many employees might not realise is that many non-monetary gifts that they may receive from their employers are taxable as “benefits in kind,” where they are expected to pay tax for the monetary value of the gift, or “benefit,” that they received. In a way, this is similar to the manner in which employees are expected to pay PRSI and PAYE for benefits in kind when they receive health insurance cover from their employer (albeit on what is typically a much smaller scale).

HR managers can prevent misunderstandings by ensuring that employees know that any corporate gifts they may receive this holiday season may end up being added employee benefits to their taxes. With this in mind, here are a few ideas for making sure that your employees know about the Benefits in Kind rules regarding their corporate gifts.

Method for Raising Awareness #1: Email

Emails are an efficient way to communicate, but not everyone regularly checks their emails, or pays attention to corporate notices.In today’s connected world, the simplest, and often fastest, way to communicate with a large group of people is to send a mass email. Here, you can send out a notice explaining the rules for benefits in kind briefly so that all employees can be brought up to speed regarding these rules.

However, while this method will be highly effective for most employees, there are always a few who may slip through the cracks. In any organisation of a significant scale, there will be that small number of employees who don’t get the email because of technical issues or who regularly ignore corporate communications.

For these individuals, you may need to use an alternative method of communicating their BIK liabilities.

Method for Raising Awareness #2: Departmental/Team Meetings

Instead of using an automated communication, you can have team managers arrange a quick meeting to discuss the issue of BIK corporate gift tax liabilities with employees in person. This gives employees the chance to hear about how corporate gifts will influence their PRSI and PAYE costs from their direct reports.

Here, employees will have an opportunity to ask questions that they may have about PRSI and PAYE. When preparing management staff for these meetings, try to provide them with as much information and resources as are reasonable so that they are ready to answer basic questions.

At the very least, this should give your front-line employees the basic idea of how benefits in kind “earnings” will affect their tax liabilities.

Method for Raising Awareness #3: Regular Mail/Brochures

Sending a brochure or other physical document detailing the nature of BIK to employees is a great way to make sure that they know about their tax liabilities for corporate gifts.For those employees who work offsite much of the time, organising a meeting with their whole department or even their core team might not be practical. When this is the case, using standard post to send employees a physical brochure to inform them of the rules regarding benefits in kind and how a non-monetary corporate gift will show up as a tax liability for their PRSI and PAYE dues.

This method gives your employees a physical item that they can reference on a moment’s notice, which can be handy for ensuring retention of information.

This particular method of raising awareness has two major flaws:

  1. It can be expensive. The larger your organisation is, the more brochures you will have to print and pay postage for. While the cost of printing a single brochure and prepping it to be sent to a single employee may be small, when that cost is multiplied by thousands of employees, the expenses can quickly become quite large.

  2. The post. Once your brochures have been made, they still have to be shipped to your employees. While the post is normally quite reliable, there is always that chance of a mishap where mail gets misfiled, delayed, or lost so that the brochure doesn’t arrive at the employee’s address in time.

Using Multiple Avenues of Communication

Rather than simply use any one of the communication methods listed above, you can use multiple methods of contacting employees to make them aware of the benefits in kind rules regarding corporate gifts.

By combining the use of communication channels, you reduce the chances of employees missing the message to almost nothing.

Try to Include Good News in Your Communications

In any form of communication regarding the rules for applying BIK to PRSI and PAYE dues, it may help to reference the exceptions to the BIK rules, such as:

  • One-time benefits under €250 in value. As reported by welfare.ie, “employers do not need to apply PRSI and PAYE to small benefits worth €250 or less as long as an employee receives only one such benefit a year.

  • Aggregation of minor benefits. When employees receive minor benefits all throughout the year, employers can make arrangements with the revenue agency to pay PRSI and PAYE on behalf of their employees. As stated on the welare.ie site, “to do this, employers must factor-in the ‘grossed up’ value of benefit – this is the notional amount which, if PRSI and PAYE were deducted from it, would leave the employee with the net value of the benefit received.”

Noting exceptions such as the above can take some of the sting out of the announcement, and help your company explain to employees why you use the benefits models that you do.

To learn more about how to communicate benefits in kind rules to your employees, or for advice about providing benefits to your employees, contact Simon Shirley Advisors today.






How to Get the Best Deal from Health Insurance Providers

Balancing the needs of your business' employees with the needs of your business can be tricky, particularly when it come to finding the right deal for healthcare.

In Ireland, the cost of health insurance for employees is community-rated, meaning that the cost of any given healthcare scheme is the same for each adult, child, or student regardless of their age or medical history. This is fundamentally different from the risk-related model, wherein costs were adjusted by the insurance provider for each healthcare applicant based on their age, occupation, medical history, and other risk factors from their lifestyle that may affect the likelihood that they will need to use their healthcare.

With Ireland’s healthcare costs being standardised for any given plan, how can your organisation get the best deal for healthcare coverage for employees?

One way is to make sure that you provide your employees with a plan that gives them the level of coverage that they need across the three benefits categories of:

  1. Hospital in-patient cover for public and private hospitals.

  2. Day-to-day cover for hospital outpatient treatment, doctor consultations, dental treatment, and other specialist services.

  3. Employee assistance programmes providing information and counseling services to employees.

While the cost for any given plan in Ireland is the same regardless of the “risk factor” that an employee represents, the level of coverage for each of the above service categories does influence the price of a plan.

Because of this, one could say that one trick to getting the best deal from a healthcare provider is to peruse their plans for the best balance of coverage types to meet the needs of your employees.

One important note: starting on 1st May, 2015, lifetime community ratings will be put into effect. This means that there will be a premuim loading for anyone who joins a plan after the age of 35. This loading will be at the rate of 2% per year, so a 35 year-old person will pay 2% extra, a 36 year-old will pay 4% more, and so on.

Choosing the Right Plan

Navigating the healthcare insurance market, and all of the options available from each provider, can be like trying to navigate a maze blindfolded.Depending on the level of coverage that your employee healthcare plan provides, the cost of cover for each employee could range from €1,000 to €1,800 per annum (note that the actual amount may vary from year to year and some premium care plans can exceed these costs).

When researching the healthcare plans that are available from private health insurance providers such as VHI Healthcare (which is partially state-owned), Aviva, GloHealth, and Laya Healthcare, do some research on your staff first. Finding out which plans are the most broadly beneficial can help you narrow your search for healthcare insurance for employees by making sure that the benefits are well-matched to your workforce.

By matching healthcare scheme benefits to your workforce demographics, you can find a plan that efficiently fills the needs of your employees without paying an arm and a leg.

Choosing Your Level of Contribution

Another way to save on employee healthcare plans is to select how much you want to contribute to said plans. There are four different levels of contribution that an employer can make to an employee’s healthcare plan:

  1. Flat Rate Contributions. Under this plan, you (the employer) make a single, flat-rate contribution to an employee’s healthcare costs. Under this contribution scheme, the employee pays the balance for any healthcare costs.

  2. Pay for Basic Plan Only. Rather than pay a flat rate, you can cover the full cost of a basic plan for the employee. If the employee wants more comprehensive coverage, then he or she can pay the difference for the more comprehensive plan.

  3. Pay Full Cost for Comprehensive Employee Coverage. Here, you assume the full cost of a comprehensive healthcare plan for the employee, removing personal healthcare costs as a concern for the employee.

  4. Pay for Full Cover for the Employee as well as their Spouse/Partner and Children. In addition to paying for the healthcare cover for the employee, you can also cover the costs of healthcare for the employee’s spouse/life partner and children. While costly, this is a very effective benefit for attracting and retaining top talents.

When choosing a level of contribution to make, try to balance the costs against the benefits of each. Also keep in mind that employees are taxed a percentage of your contributions to their healthcare plan costs for Pay-Related Social Insurance (PRSI) contribution as a Benefit-in-Kind. As the employer, you also pay Employer PRSI tax on the health insurance premiums your company pays for employees.

As an addendum, it is important to, as the welfare.ie webpage on PRSI states, “make sure you apply the correct contributions class to each employee at the time you pay him or her… if under these circumstances the employee ends up paying more PRSI than he or she owes, their employer must repay him or her the difference.”

According to research by Mercer, 52% of healthcare plans cover the employee and his or her family, 20% cover only the employee, 12% cover employee and spouse, while the other 16% of plans are listed as providing “other cover.”

The best choice of healthcare scheme is influenced by many factors, from how much coverage your employees need, what the standards for healthcare coverage in your industry are, and your need to find ways to prevent employee turnover.

A Little Help Goes a Long Way

One of the most effective ways to make sure that you provide your employees with the best in class benefits for healthcare is to consult with an employee benefits advisor for assistance. These individuals are dedicated to keeping up with the latest available schemes, and can provide a cost to benefit analysis for each plan, as well as help you to correctly calculate the PRSI rate for each employee based on their class and subclass as determined by nature of occupation and weekly pay.

The trouble with researching healthcare offerings independently is that, as an HR manager, you have many other responsibilities that need to be taken care of. Often, by the time that a busy manager completes a thorough analysis of the offerings available for healthcare, some offerings may have changed or new ones may be created which would be a better match for your company’s needs.

A dedicated employee benefits advisor is able to focus on finding the best healthcare benefits packages for your employees, leaving you free to handle other tasks. Employee benefits advisors can compare rates, benefits, and even help with the implementation of a new healthcare scheme.

Learn more about employee benefit options from our free eBook at the link below, or contact Simon Shirley Advisors now!






Retain and Attract Talent with Employee Benefits Rather than Salary

Keeping workers happy and engaged with work is a key part to improving employee retention.For any HR manager, being able to not only attract top talents, but retain them so that they provide the maximum possible value for the company can be a huge challenge. One way in which many companies try to be competitive in the jobs market and attract top-notch talent is to offer “competitive” salaries, basically trying to outbid their competitors to get the attention of potentially high-value employees, and to keep the employees that they do have.

However, simply increasing salary does not necessarily motivate people to perform better, or stay with the company. While providing fair compensation is an important element of attracting and keeping valuable employees, pay is not the only concern that leads to top talents jumping ship.

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4 Signs You Need an Employee Benefits Advisor

Do you need an employee benefits advisor?Here at Simon Shirley Advisors, we understand that the life of a modern HR professional is a busy one. Keeping employees working at peak efficiency and preventing top talents from defecting to the competition takes an extraordinary amount of effort. Between driving employee engagement, managing payroll, and ensuring that best in class learning and development practices are in place, a human resources manager’s work is never done.

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Insurance forms a significant and very important part of personal and business planning. The chances are that you have several types of insurance – such as insurance for your house, car, medical bills, travel, holidays, mobile phones, gadgets, mortgages, business premises, employees – and perhaps even for your pets.

Many of these types of insurance are essential – however by far the biggest financial risk for you and your dependants is the risk of your death and the risk of you becoming ill and unable to work. Despite the importance of insuring against these risks, individuals may not fully appreciate the appropriate levels of life assurance required, and/or may not be aware of the different structures and tax reliefs available.

TYPES OF LIFE ASSURANCE COVER

The 3 main types of life assurance cover
consist of:
1. Life Cover – this cover provides a lump sum payment in the event of your death. If you have a mortgage on your home, you most likely have life cover on the mortgage – with your lender as the beneficiary in the
event of your death. The cost for certain types of life cover can qualify for income tax relief at your marginal rate, if structured correctly.
2. Income Protection Cover – this cover
provides an ongoing monthly income in
the event that you are unable to work due
to illness/accident/injury/disability. The
cost of this cover qualifies for income tax
relief at your marginal rate.
3. Specified Illness Cover – this cover
provides a lump sum payment in the event
of the diagnosis of a specified illness (such
as cancer, heart attack, stroke, etc). The cost
of this cover is not allowable for income
tax relief.
The importance and appropriate levels
of these types of cover depend of your
personal circumstances and your stage in life.
In an ideal world, we would all have the
maximum levels of all types of insurance –
however, the reality for most of us is that
insurance is often a balancing act between
weighing up the actual ongoing cost of
insurance against the importance and
seriousness of the risk.
As general rules-of-thumb:
I ➤ If you are working but do not have
dependants (such as young children),
you should have income protection
cover to cover most of your income.
Your ability to earn an ongoing income
is likely to be your most important
financial asset.
➤ If you have dependants (such as young
children) you should have adequate life
cover for your family’s benefit in the
event of your death (in addition to life
cover on your home mortgage), and
you should have adequate income
protection cover. In my view, if you have
children, then these two types of life
assurance cover are essential.
➤ Specified illness cover is important;
however, in general, you should only
consider specified illness cover after you
have ensured that you have adequate
levels of life cover and income
protection cover. Specified illness cover
is generally expensive compared to life
cover.
HOW MUCH COVER DO YOU
NEED?
The amount of cover you require depends
on your personal circumstances. If you havensurance forms a significant and very
important part of personal and business
planning. The chances are that you
have several types of insurance – such
as insurance for your house, car,
medical bills, travel, holidays, mobile phones,
gadgets, mortgages, business premises,
employees – and perhaps even for your pets.
Many of these types of insurance are
essential – however by far the biggest
financial risk for you and your dependants
is the risk of your death and the risk of you
becoming ill and unable to work. Despite
the importance of insuring against these
risks, individuals may not fully appreciate the
appropriate levels of life assurance required,
and/or may not be aware of the different
structures and tax reliefs available.
TYPES OF LIFE ASSURANCE
COVER
The 3 main types of life assurance cover
consist of:
1. Life Cover – this cover provides a lump
sum payment in the event of your death.
If you have a mortgage on your home, you
most likely have life cover on the mortgage
– with your lender as the beneficiary in the
event of your death. The cost for certain
types of life cover can qualify for income
tax relief at your marginal rate, if structured
correctly.
2. Income Protection Cover – this cover
provides an ongoing monthly income in
the event that you are unable to work due
to illness/accident/injury/disability. The
cost of this cover qualifies for income tax
relief at your marginal rate.
3. Specified Illness Cover – this cover
provides a lump sum payment in the event
of the diagnosis of a specified illness (such
as cancer, heart attack, stroke, etc). The cost
of this cover is not allowable for income
tax relief.
The importance and appropriate levels
of these types of cover depend of your
personal circumstances and your stage in life.
In an ideal world, we would all have the
maximum levels of all types of insurance –
however, the reality for most of us is that
insurance is often a balancing act between
weighing up the actual ongoing cost of
insurance against the importance and
seriousness of the risk.
As general rules-of-thumb:
I ➤ If you are working but do not have
dependants (such as young children),
you should have income protection
cover to cover most of your income.
Your ability to earn an ongoing income
is likely to be your most important
financial asset.
➤ If you have dependants (such as young
children) you should have adequate life
cover for your family’s benefit in the
event of your death (in addition to life
cover on your home mortgage), and
you should have adequate income
protection cover. In my view, if you have
children, then these two types of life
assurance cover are essential.
➤ Specified illness cover is important;
however, in general, you should only
consider specified illness cover after you
have ensured that you have adequate
levels of life cover and income
protection cover. Specified illness cover
is generally expensive compared to life
cover.
HOW MUCH COVER DO YOU
NEED?
The amount of cover you require depends
on your personal circumstances. If you have