Gallagher 2020 Benefits Strategy & Benchmarking Survey highlights pressing need for UK employers to prioritise employee wellbeing by enhancing benefits packages and improving internal communications.

NBS Survey Report

Research conducted by Gallagher has highlighted that prioritising wellbeing is central to retaining and attracting employees as organisation’s emerge from COVID-19 disruptions. The 2020 survey shows that 73% of UK employers intend to enhance their benefit packages in 2020.

Three priorities emerge in the report findings: implementing an effective digital platform to support evolved flexible working patterns; establishing and communicating a clear purpose narrative; and strengthening environmental, social and corporate governance (ESG) commitments to align with individual benefits.

Nick Burns, CEO, at Gallagher’s UK Employee Benefits Consulting Division, said: “In a post-COVID-19 world, where workforces are more disparate and borderless than ever before, benefit communications will play a key role in re-engaging employees. Investing in these digital channels and ensuring they are fit for purpose will be key for boosting morale and maintaining a productive workforce.

“It is also clear from this year’s reports that with so many people now working from home, creating a sense of belonging has had to be approached differently. Those who focus on aligning a company’s purpose with their benefit offering, ESG strategies and general governance will come out on top.”

Key findings:

1) The COVID-19 effect: a borderless workforce and digitisation

  • 73% of UK employers intend to enhance their existing benefit packages in 2020
  • 50% of organisations intend to invest in digital communication channel improvements to improve engagement and maintain/lift productivity
  • 62% of employers now allow employees to work from home regularly, with several companies intending to maintain more flexible working practices long term
  • One in two internal communicators believe their organisation’s digital set-up just isn’t good enough
  • 33% of organisations surveyed for the 2020 report are planning on making changes to their reward and benefit packages

2) Why’ over ‘What?’ – communicating purpose & clarity is the new agenda

  • Organisations need a stronger employee value proposition (EVP) to differentiate the workplace, and attract/retain/engage the best talent.
  • The ability to communicate a clearly defined strategy and narrative is critical for employee engagement/reengagement (pgs. 45-46).
  • 52% of those planning changes for 2020 intend to improve their benefit communications
  • Two in five organisations now have a benefits portal with relevant communications (up from one in three: 2019)
  • 65% of surveyed organisations lack a pre-defined communications budget specific to employee benefits. Up 9% on previous year (56%)
  • 34% of HR and benefits practitioners struggle to communicate effectively about benefits

3) Demand for ESG-aligned benefits

  • 13% of surveyed organisations have implemented an ESG strategy, which also applies to their pension fund investment approach and related internal communications
  • Asset management is the most ESG-focused employment sector with 70% of organisations having a formal environmental and social governance (ESG) strategy and related communications approach to employees
  • In other industries, only 40% of employers have an ESG strategy, half of whom have applied it to their pension fund investment approach and related internal communications

Additional context:

The COVID-19 effect: a borderless workforce and digitisation

Flexible hours and, home working are two of the biggest changes to come out of the COVID-19 pandemic. Research indicates seven in 10 workers may have been teleworking at the height of the UK lockdown with several large corporations signaling a permanent move to home working or blended home/office arrangements.

Flexible working places more emphasis on digital channels. Defaulting to time-honoured communication via email and intranet is no longer fit for purpose. The research reveals 50% of surveyed organisations intending to invest in multi-channel digital capability for internal communication to improve and enhance employee connection and engagement.

The need for a clear purpose narrative

As UK organisations emerge from COVID-19, providing a clear organisational purpose narrative of which employee wellbeing sits at the heart of. Employees are calling out for meaningful messages which reinforce their employer’s mission statement and purpose. However, the continued use of impersonal, formal channels such as email doesn’t allow senior leaders to convey a sense of genuine concern and commitment. As a result, organisations are increasing their efforts to communicate this with their employees with 52% of those planning changes for 2020 intending to improve their benefit communications and 54% now actively polling employees about benefits and wellbeing, up 26% from 2019. Almost two in five organisations (39%) now have a benefits portal with relevant communications (up from one in three in 2019), 65% of surveyed organisations still lack a pre-defined communications budget specific to employee benefits. This is up from 9% on previous year (56%).

Demand for ESG-aligned benefits

Survey respondents indicated a strengthened commitment to ESG. Benefits available to employees are evolving to better align with an organisation’s approach to implementing environmental and societal wellbeing across business strategy and governance. Asset management is the most ESG-focused employment sector with 70% of organisations having a formal environmental and social governance (ESG) strategy with 26% of these applying this to their pension fund investment approach and related communications to employees. There is still room for improvement, however, as only 40% of employers across other industries have an ESG strategy with half of those having applied it to their pension fund investment approach and related internal communications.

Gallagher’s 2020 Benefits Strategy & Benchmarking Survey asked employers, particularly in the context of COVID-19, how their strategies are evolving to keep pace with changing employee priorities across the spectrum of benefits including pensions, workplace perks and flexible working.

Editor’s Notes

2020 Gallagher Benefits Strategy & Benchmarking Survey

Gallagher developed the first UK version of the Benefits Strategy & Benchmarking Survey in 2018 to provide employers with insights into how their peers are addressing benefit and talent management challenges. This year’s survey, conducted from April to Jun2 2020, aggregates responses from 200 organisations across the UK from various industries and sectors, and of varying size and revenue streams. The survey has previously been conducted in the U.S. and Canada. Additional survey results can be found at ajg.com/uk/UK-Benchmarking-Report-2020.

About Gallagher

Arthur J. Gallagher & Co. (NYSE: AJG) is a global insurance brokerage, risk management and consulting services firm headquartered in Rolling Meadows, Illinois. The company has operations in 49 countries and offers client-service capabilities in more than 150 countries around the world through a network of correspondent brokers and consultants.

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