More employers in the United Kingdom are offering flexible benefits in an effort to increase employee engagement and attract and retain top performers, but many fail to measure the return on their investment, a survey shows.
Seventy percent of organizations polled provide flex benefits—up from 62% in 2012, according to the 2013Benefits Administration Survey conducted by Aon Hewitt.
“Flex is a growing part of the employee benefits ‘menu,’ offering a real answer to organizations’ problems by further allowing the shaping of benefits, the work environment and the options they present to their employees to enable them to take control of their health, retirement, financial security and careers,” says Andrew Woolnough, client development director with Aon Hewitt.
The survey also reveals that employers are investing more resources in benefits packages. One-third of respondents spend more than 20% of payroll on benefits, and more than half spend more than 15% of payroll on these packages.
Although employers have increased their benefits spending, many of them fail to track measurable returns on their investment, he says.
“It is not just a matter of increased measurement but also of enhancing perceptions,” Woolnough explains. “Effective employee communication is key to this process and is becoming more important than ever as the benefits agenda extends into engagement.”
The survey shows that to cut costs and improve employee experience, U.K. employers are increasingly outsourcing the administration of flexible benefits—73% of respondents this year, up from 60% in 2012. The majority of employers report high satisfaction with outsourced service providers.
The Aon Hewitt survey polled 361 respondents from organizations representing more than two million employees.
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