Offering a comprehensive benefits package is vital in the war for talent in a competitive job market, says Smith & Williamson partner Claire Griffin.
Flexibility is key
Partners and employees are seeking more flexibility and this extends to choosing the benefits most valuable to them. A core offering usually covers pensions, life cover, income protection and private healthcare. However, other benefits such as top-up life assurance, critical illness, dental and travel cover can be attractive and a big draw for new recruits.
Our previous surveys have shown that firms expect the use of flexible benefits to continue to increase. A good benefits package can create a positive working environment, reduce partner and employee turnover and increase individual performance.
While most acknowledge the importance of both financial and non-financial rewards, it’s not enough simply to provide access to a range of benefits. There should also be an effective communication strategy to educate and engage partners and staff, ensuring they have a full understanding of the benefits and services available
Access to healthcare advice
Consider private medical cover for example. The demands of modern life and work commitments coupled with GP availability often makes it difficult for lawyers to find the time to visit their GP surgery to discuss health concerns. But many healthcare policies offer 24 hour access to GPs, nurses and stress counsellors. Their triage services can also refer members for treatment for certain conditions.
This has a number of advantages — less unnecessary time away from work for GP appointments, no delay in accessing the support needed and reduced absence through sickness as a result of earlier intervention.
From a tax perspective, it’s vital to ensure the most appropriate scheme structure for partners’ protection benefits in place. Lump sum benefits paid from a registered group life scheme are free of tax up to the partner’s remaining Lifetime Allowance (currently £1m). Any benefits in excess of this are liable to tax at up to 55%.
Take-on procedures should be reviewed for individuals joining at a senior level. Anyone with enhanced or fixed protection should be wary of joining a new scheme as this could jeopardise their protection.
In a world of ever changing legislation, effective scheme governance should help firms to identify and reduce liabilities. It’s critical that benefits are reviewed regularly. Benchmarking against a peer group helps to ensure that benefits remain relevant and that they continue to meet both business requirements and partner and employee expectations.
By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. This briefing does not constitute advice nor a recommendation relating to the acquisition or disposal of investments. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details correct at time of writing.
This article was previously published on Smith & Williamson prior to the launch of Evelyn Partners.