Managing staff costs
Employees may be your greatest asset but are they costing you too much?
- Pay is only motivational to a point: A good employment package really helps but people need to know its value to maximise the return on your investment.
- A good package = less staff turnover = lower recruitment costs.
- Profit-related pay encourages staff to focus on the success of your business.
- Non-cash alternatives to pay can be more cost-effective than cash.
- Provide 'expected' core benefits but don't go 'overboard'.
- Allow staff to purchase extra benefits (extra holiday, gym membership).
- Permit salary sacrifice arrangements.
- Use effective IT systems for benefits and HR administration - multiple spreadsheets become unwieldy, unreliable and waste time/money.
- Risk benefit markets are buoyant - review providers regularly for cost savings.
- Do your benefit consultants give good value? Periodically review advisers.
- Do staff value their benefits? If not, your money is not well-spent.
- Has your benefits package fallen behind your competitors? Impact on staffing?
- Tax breaks make some benefits better value for money.
- Manage staff absence and control related costs.
- Ensure your staff know what their employment package is really worth - total reward statements achieve this. It is cheaper to retain staff than to recruit and train new people.
- Get an employment lawyer - they can save you from expensive HR mistakes!
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.