How do I cut staff benefits without losing staff loyalty?
In any economy, employee engagement is the key to business success. Any action you take should be carefully evaluated for its impact on engagement today, and on tomorrow too.
Benefits are key to attracting and retaining talented, highly productive employees and if you're going to make changes to the benefits you offer, it's vital you manage it while maintaining a positive vibe.
Here are our tips for shedding employee benefits without losing employee engagement:
- Conduct a benefits review – You developed your current staff benefits package to make you a competitive employer capable of attracting and retaining the best talent. Since many benefits may be contractual, the aim here is to identify and cut wasteful perks or those with no clear business purpose or advantage, such as business lunches, golf or social days. If enough savings can be made in this way, it negates the painful necessity of removing benefits and rewriting contracts.
- Change your definition of an employee – You're all in this together so now is the time to stop thinking of 'us' and 'them' and regarding your staff as people who show up and do what they're told without question. Begin to build a more dynamic, empowered, engaged and recession-proof workforce by 'letting employees in' and encouraging them to take ownership of a larger proportion of your company's ideas, policies, services and results.
- Share the truth – Once you have formalised your benefits review, gather your entire workforce together. Be honest with them about the financial picture. Share the truth with your employees and, armed with the facts, they will be more willing to make all necessary cuts and changes. Explain that it will require the commitment of every employee to help find ways to cut costs.
- Listen up – Encourage your managers to be more visible and connected to their teams to gain a better sense of staff morale. Get them to hold huddles – small team meetings – at which staff give feedback on their cost-cutting ideas. List all these and offer them to the board for serious review. At the next regular meeting, list which of these measures will be implemented.
- Think flexible – Don't just think of things you can take away. Think of things you can give as well. Think of time as the valuable currency it is to your employees. If you have been holding back, this may be the perfect time to introduce flexible working hours. As companies who have already embraced it can testify, flexible working hours can dramatically help you cut costs without the need for wide-scale redundancies or benefits slashing. So, just for starters, consider remote working options, staggered or reduced schedules, partial work and pay packages or unpaid sabbaticals. Talk to your staff about their preferred options.
- Cut from the top down – Don't make the mistake of only making cuts at the shop-floor level. If the pain is not shared and does not first affect those who are more significantly paid and rewarded, resentment will undoubtedly build. So start by seriously cutting management perks – a mere gesture will be seen through – and share what has been done at the next staff meeting. This will truly help to establish rapport and a real sense of all being in this together.
- Don't go back to the bad old days – When things begin to get better, don't revert to the old days when staff were mere ciphers and had no say. Encourage engaged employees to continue to have a proactive say in the company. This could include giving them a role in the benefits renewal process; for instance, reviewing new health plan options or leave packages.
In fat times and lean, active employee engagement will continue to be your most powerful driver toward, not only passive business survival, but toward active business success.