How can small company owners match big name employers when it comes to salaries, long-term security or the growing packages of benefits? CEO at Untangl Richard Stewart, explained how the underdogs can compete.
Attracting talent to a startup or small business can be a headache, even though startup founders are in a strong position when it comes to offering the buzz and challenge of a new enterprise, including flexibility, more involvement and sense of purpose.
Employers recognised as the “best to work for” attract and retain talent pools with a full welfare service for employees and their families, including everything from free health screening and private medical care to counselling, childcare, financial advice, fitness club memberships and massage therapies.
You want to do the right thing by staff, but the admin related to services like HR, recruitment, payroll and benefits – the kind of offerings that deliver a slick veneer for employees and the reassurance they’re part of a high-quality operation – is time consuming and complex.
The majority of employee benefits have historically been arranged through intermediaries like financial advisers. Advisers can be expensive and, since the ban on taking commission, have been following the big budgets rather than attempting to engage small business owners.
The one benefit small firm owners have to offer to workers under new regulations is a pension. The arrival over the next two years of pension auto-enrolment also means the risk of penalties and fines for employers that get this wrong. Many will not have solid systems and accurate payroll data to rely on.
The best way to think about employee benefits is to categorise them into four types (health/wellbeing, support services, financial security and savings) and then look at what measures you can take in each area to suit your business and type of employees.
Don’t forget that you have the same duty of care to look after employee health and wellbeing, both physical and mental – an issue the government is increasingly taking an interest in.
A recent study by Westfield Health found that more than a third of UK employees say their working environment has a negative impact on their mental health, and one in two employees felt that their workplace did not manage mental health issues well.
Putting in place access to employee support, like telephone and face-to-face counsellors, to help deal with stress and also other services like physiotherapists, demonstrates awareness and practical support for employees – and helps reduce levels of absenteeism.
Offering good benefits doesn’t need to be costly or complex. New technologies and business models based around simple cloud-based apps mean small firms no longer need to be excluded.
You also need to be smart about focusing on the benefits that matter. Whilst “perks” like fancy free lunches, a ping-pong table and team outings might help reflect the social and cultural side of your company’s work environment, it’s important to focus on the benefits that deliver real value.
Your best people will be looking for longer-term benefits, like training and development, flexible work hours, health care, pensions and the opportunity for more time off. Committed staff with an eye on the future with your firm are also looking for solid parental benefits like paid maternity and paternity leave, and childcare programmes.
You may not be able to match big business on a like-for-like basis when it comes to competing for talent, but research into employee motivation and engagement regularly shows that money is one of the poorest motivators.
What small business owners can do is combine their essential advantages in offering a more rewarding, human environment with a decent set of employee services and benefits that plug the hole of expectations.
Richard Stewart is co-founder and CEO of Untangl.
Read our expert’s guide on recognising those extra employee contributions.
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