Research shows that companies that take better care of employees also perform better in business.
People magazine, partnering with research and consulting firm Great Place to Work, found companies that scored highest in being attentive to their employees made four times the revenue than those that were neglectful of their workers. “The companies that scored highest in leadership effectiveness made five times the revenue than those that didn’t. And the companies that sought employee opinions and prioritised worker opportunities to innovate made 5.5 times more,” says People.
Liberty has conducted research of its own and arrives at the same conclusion. “Based on our research, we found small and medium-sized companies (SMEs) struggle to attract good talent and then retain them when it is competing against bigger companies with deeper pockets. We used our research to re-orient our employee benefits to address this need,” says Linda Schroeder, divisional executive for Corporate Sales and Servicing at Liberty Corporate.
Liberty’s research shows companies that take better care of employees suffer less absenteeism, improved productivity and greater company loyalty. Taking better care of employees does not necessarily mean paying them more. SMEs battle to compete with larger companies in the area of employee benefits due to lack of resources. Their human resources divisions are generally small and under-resourced, and they lack the scale to compete in terms of staff facilities such as canteens and gyms.
One of the biggest issues facing SMEs is the call from employees for company loans because their wages are insufficient to cover their expenses. Rather than being a sign that employees are not being paid enough, the demand for month-end loans suggests bad financial planning.
Employee benefits has become a highly commoditised offering built around investments, umbrella funds, consulting services and risk protection such as death, disability and dread disease cover. This is the standard employee benefits package. Though employees are the beneficiaries, the purchasers of these packages are employers, and sales teams from benefits providers tailor their sales pitches to the language of those who make the financial decisions in companies.
Liberty operates the largest umbrella fund for SMEs in the country measured by the number of participating employers. An umbrella fund is established to accommodate individual companies that are not related to one another; their assets are held in sub-funds in the umbrella fund.
Liberty decided to differentiate itself by looking at employee benefits as a life journey. One of the key elements missing from traditional employee benefits offerings is education. Liberty launched the ‘Mind My Money’ programme to fill this gap. This involves educating employees on the basics of financial planning, such as how to understand their pay slips, how to file tax returns, monthly budgeting and the importance of drafting a will.
Experience shows that employees who are properly educated in financial basics are more likely to live within their means, pay down debt and accumulate savings.
“One of the things we do is help employees understand their credit rating, and how to improve it,” says Schroeder. “This may seem like an obvious thing that everyone should understand, but the truth is it is poorly understood and can create huge problems for employees and their families.
“We have also identified the need to provide assistance to members during life events and have teamed up with an external professional service provider to provide our members, their spouses and their dependents under age 21 with much-needed telephonic assistance. These services are available 24 hours a day, 365 days a year in the member’s language of choice. The professional counsellors are trained in a range of disciplines, from legal advice to emergency medical information and trauma assistance. We include emergency ambulance services and body repatriation in these services. When you are responsible for the overall wellbeing of employees, you have to be able to offer guidance and advice on a range of different areas.”
Liberty would like to partner with employers to ensure that they look after the wellbeing of their employees. This will not only enrich the lives of the employees in their organisation but will improve their bottom line.
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This article does not constitute tax, legal, financial, regulatory, accounting, technical or other advice. The material has been created for information purpose only and does not contain any personal recommendations. While every care has been taken in preparing this material, no member of Liberty gives any representation, warranty or undertaking and accepts no responsibility or liability as to the accuracy, or completeness, of the information presented. The writer although an appointed representative of Liberty Group Limited, is not allowed to sell financial products. Please consult your financial adviser should you require advice of a financial nature and/or intermediary services. Liberty Group Limited is a Registered Long-Term Insurer and an Authorised Financial Services Provider (FAIS no 2409).