Abstract: Whereas employers are investing in advantages, most aren’t getting actual worth from them. There’s a hole in how advantages are communicated, administered and ruled, with staff reporting decrease consciousness and understanding of their advantages than employers assume.
Drawing on responses from 626 HR and finance professionals throughout the UK, Brown & Brown’s 2026 Worker Advantages Benchmarking Report, reveals the place the hole between employer funding and worker expertise is widest.
Advantages communication is falling quick
Whereas findings point out that 91 per cent of employers imagine their workers perceive the advantages on supply, separate worker analysis tells a really completely different story. Solely 36 per cent of staff say they absolutely perceive their advantages, and simply 11 per cent recall receiving common communication about them.
E-mail is the dominant communication channel for advantages, utilized by 57.2 per cent of employers. Worker handbooks comply with at 37.5 per cent. Neither is inherently improper, however each are passive.
A one-off enrolment electronic mail not often modifications behaviour. For advantages like office pensions, revenue safety and personal medical health insurance (merchandise that require real understanding to drive uptake), passive communication isn’t sufficient.
If staff don’t absolutely perceive their advantages, they’re not going to worth them – and employers received’t see the retention and engagement return they’re paying for.
Solely 36 per cent of staff say they absolutely perceive their advantages
Handbook advantages admin is riskier than most admit
Over one-quarter of employers (25.7 per cent) nonetheless depend on spreadsheets or handbook paperwork to handle their advantages administration. An extra 26.2 per cent use a mixture of disconnected platforms, and the dangers are exhibiting, as 46.6 per cent of employers report at the very least one information error up to now 12 months attributable to handbook processes.
Errors in advantages administration can imply incorrect insurance coverage premiums, failed claims, payroll discrepancies and compliance gaps. The extra telling determine is that 95.9 per cent of employers specific confidence that they course of modifications precisely. But the info means that confidence is misplaced for a major proportion of them.
Many employers are taking dangers with pension governance
Auto-enrolment established the bar for office pensions, however governance is what maintains the usual. But a couple of in 5 employers (20.8 per cent) admit they don’t have any formal governance in place for his or her scheme. An extra 21.4 per cent assessment their office pension lower than yearly, or by no means.
With out common oversight, funding methods drift out of alignment with workforce demographics and contributions can fall behind market expectations.
At a time when 84 per cent of jobseekers say pension high quality influences their selection of employer, a poorly ruled scheme is each a compliance threat and a missed engagement alternative.
The tax effectivity most employers are lacking
With Nationwide Insurance coverage contributions rising and employment prices below sustained stress, many companies could also be discovering methods to be extra environment friendly.
Regardless of this, practically 40 per cent of employers nonetheless don’t use wage alternate for office pension contributions: some of the tax-efficient methods of creating pension contributions.
With this methodology, staff agree to cut back their gross wage by their pension contribution quantity, whereas employers contribute that sum instantly, and each events pay Nationwide Insurance coverage on a decrease wage. Basically, the identical pension consequence prices much less general.
Analysis means that an additional one per cent in pension contributions may develop an worker’s remaining retirement pot by round 22 per cent over 30 years. With this in thoughts, wage alternate is without doubt one of the only methods to realize that with out rising employer price. But it stays underused.
Practically 40 per cent of employers nonetheless don’t use wage alternate for office pension contributions
Employers are break up on benchmarking
Slightly below half of employers (49.5 per cent) actively benchmark their advantages in opposition to rivals. Nearly the identical proportion (46.8 per cent) don’t.
Meaning practically half of UK organisations are making substantial advantages funding selections with out figuring out how their bundle compares out there they’re recruiting from.
Benchmarking doesn’t must be a convoluted course of. It may be a case of talking to staff, reviewing sector information or talking with an adviser.
Benchmarking offers readability, and for selections that affect retention and employer model, readability is well worth the effort.
Taking motion on worker advantages
Many organisations are investing in worker advantages, however not all the time getting the complete worth from that funding.
What you select to supply is step one, however the problem comes from how these advantages are designed, communicated and managed day-to-day.
The organisations seeing the best affect aren’t essentially those making the most important funding. They’re those that undertake clearer communication methods, higher administration techniques, common governance opinions and an trustworthy take a look at the place their bundle sits out there.
When these parts come collectively, advantages begin to work more durable, shifting from a enterprise price to one thing that genuinely helps efficiency, retention, and long-term progress.
Actionable insights
- Guarantee your staff perceive their advantages: A single enrolment electronic mail isn’t sufficient. There’s a want for normal, focused communication.
- Handbook admin is a compliance threat: Practically half of employers skilled a knowledge error up to now 12 months. This makes the case for higher, extra related techniques.
- Test whether or not wage alternate is ready up: It cuts Nationwide Insurance coverage for each employer and worker with no discount in pension contributions.
- Schedule a pension governance assessment: It’s essential to cut back compliance threat and enhance worker belief.
- Is your advantages bundle aggressive in your sector and measurement?: You need to go into your subsequent renewal figuring out whether or not you want to change what’s on supply.
