How it works
These days employees are often expected to manage flexible benefits and pension-planning themselves through a company website. However, market insights company Information Resources Inc (IRI) found technology was proving a barrier to take-up of its package and decided to take a different approach to communication. First, a letter was sent out to employees from the regional managing director for Northern Europe, Jeremy McNamara, explaining clearly the changes being introduced. Then presentations for 20 people at a time were held at IRI's Bracknell office, covering the details of the total package and introducing the free financial adviser service being made available to all staff in work time.
WHO BENEFITS
Only 5% of employees had been using the company website to manage their pension accounts and other benefits.Thanks to the HR team encouraging staff to spend an hour with a pensions expert, 95%of employees did so, having the complete benefits package explained to them, with personal circumstances taken into account when advice was given. Actual participation in the pension scheme increased from 50% of staff to 93%, and an impressive 71% of staff upped their pension contributions following their meetings with the financial advisers. The previous low take-up of pensions had meant only 10% of the 250 employees were on track to meet their retirement expectations. This figure has risen to 65.
WHAT IT DELIVERS
The response to the company's more personal form of communication was overwhelming, with 50% of the workforce saying the scheme had improved their sense of loyalty to the company. Almost all - 95% - said their pensions' knowledge had improved, and 75% said that knowledge had increased 'significantly'. The average company pension contribution is currently 7%, and this is expected to rise to 9% in the next five years. As IRI competes with many other large companies along the Thames Valley corridor, the company needed to improve its ability to attract and retain quality graduates and experienced data analysts, and it believes the personal touch has helped it make genuine progress.
THE HR VIEW
Ros Smith, IRI's HR director, was shocked to discover employees couldn't see the value of the benefits scheme. "We had whiz-bang technology on offer to help people manage their pensions online, but that was proving to be over-complicated and off-putting. Individuals clearly prefer the group presentations and face-to-face meetings with financial advisers. After all, everyone has different circumstances and ideas about when they want to retire." Smith says a 'snowball effect' kicked in, with individuals recommending the financial adviser meeting to their colleagues once they had discovered the benefits for themselves. She says HR time spent on benefits management has increased but that cost savings have been managed in the process. "For instance, our National Insurance contributions come down when more people are set up with salary-sacrifice to fund their pension," Smith explains. The company feels duty-bound to help staff make adequate provision for their retirement, she says. "It's a serious concern if that's not happening."
THE EMPLOYEE'S VIEW
Maureen Boss, senior project manager at IRI, admits that she used to largely ignore the emails she received about her pension, thinking: "I'll get round to sorting that out next week." She had only a vague understanding of the life assurance, medical cover and other benefits on offer in the company's package. "Like many people my head was firmly in the sand, but the personal touch led to some useful changes and now I'm really beginning to prepare for my retirement," says the 45-year-old, who has been with the company for 10 years. The financial adviser she spent time with had all her personal information to hand, and took into account previous pensions she had paid into. He recommended contracting back into the State Earnings Related Pension Scheme (SERPS) alongside her company pension, which she has done. "This was a golden opportunity to sort out several things at once," says Boss. "It has saved me time and provided some peace of mind. Colleagues and I feel it's been a very worthwhile exercise."
