Fostering Loyalty – Five Ways To Show Your Staff They Are Valued
Whatever stage your business is at, staff turnover is always a worry; when someone hands in their notice, it may feel like you’ve wasted money and resource and now you have to put in more to find a suitable replacement. Retention of a workforce is an area that we have advised on a number of times, and a review of the company’s culture and employee benefits can shed light on your hiring rates. People often need to feel valued by their colleagues, managers and those on high as well as having options to progress, learn and gain financially, so here are five ways in which your business could turn resignation letters into loyal team members.
Larger businesses could consider offering employees shares, which is one key way of persuading a member of staff to remain with the company, but if shares are sold the individual may have to pay Capital Gains Tax. Also, there are added tax incentives if the shares are offered through on of the following schemes:
> Share Incentive Plans (SIP) – Individuals are not required to pay Income Tax or National Insurance on Free, Partnership, Matching or Dividend Shares through a SIP, as long as they remain in the plan for 5 years.
> Save As You Earn (SAYE) – Individuals can save up to £500 a month and at the end of the three or five year contract, the money can be used to buy shares at a fixed price. Any interest on the savings is tax free and the difference between the cost and worth of the shares is omitted for tax and NI purposes.
> Enterprise Management Incentive (EMI) – Individuals don’t have to pay Income Tax or National Insurance on shares are purchased in this plan, as long as they paid least the market value they had when the person was granted the option. Companies can grant options up to the value of £250,000 in a 3-year period and have £30 million or less of assets.
> Company Share Options – Individuals can be given the chance to buy up to £30,000 worth of shares at a fixed price and no NICs or tax will be paid on the difference between what was paid for the shares and what they’re actually worth.
Training and Development
People working in any sector at any level should be able to continue developing their career, if they wish, and to learn new practical and interpersonal skills. Those who feel bypassed of opportunity or generally stagnant in their role are the first to start looking on the job sites, and business owners or department managers may not see the problem until it’s too late. From a one day course to better use a piece of software to completing a first aid at work course, from lessons to facilitate a change in career to a Master’s Degree, most of us will benefit from studying. Adams Moore has advised companies to look carefully at prospects being offered to staff, and holding consultations is a way of positively engaging with people, listening to their needs and developing training pathways.
Professional Body Membership
Membership to organisations that set, and sometimes enforce, standards for a particular field or profession is often beneficial for the individual associate as well as the company that employs them. Staff who are members are illustrating they have excellent sector knowledge and aptitude, and they can access a wide range of information, documentation, training and peer support; businesses who employ people who are members are illustrating their company’s worth through having a highly skilled workforce. Paying for such membership or Chartership is another way of showing your business understands the importance of personal and career development, which can help in nurturing loyalty.
All work and no play made Jack a dull boy who started looking for a new job. Giving something back to your staff in the form of a fun day or night out can really lift morale, help new friendships blossom across different teams and show that you’re thankful for everyone’s hard work. Christmas parties or annual dinners are the highlight of many people’s years, but there a wide variety of activities that can get people out of the office to bond and let their hair down. From hiring narrowboats and go-kart tracks to completing a scavenger hunt or escape room, events are a great way to say thank you. Business also get an added bonus in the way of a tax exemption on food, drink, tickets, accommodation, venue costs and more; if the event or events recur annually and is open to all staff or a specific department, £150 per-employee is tax-deductible. If a partner is invited, the exemption applies to their costs of up to £150 also. The amount can be spread across more than one event but even one pence over the allowance will mean no costs can be offset.
Tax Efficient Benefits
A salary sacrifice is a popular way of helping employees to reduce their tax or NICs; instead of cash in the bank, they receive something else of benefit, and it is this that is exempt from tax, or comes with a more advantageous tax bill. If what your business can clearly explain what the benefits mean for them, they may think twice about filling in that other job application. Childcare voucher, cycle to work and pension schemes are fairly standard, and gaining academic qualifications, buying extra holidays or purchasing phones or tablets are becoming more common. With workplace pension contributions now compulsory, businesses should consider if putting more into employees’ pension pots will be favourable on the tax bill. However, it is also important to understand if it will influence an employee’s choice to stay or move onto another company and if the cost is less than the burden of re-recruiting.
If you’re looking for advice on tax efficient benefits for your business or employees, please contact us to discuss the options available.