Boosting Workforce Productivity Through Employee Benefits

Government budget cuts, redundancies and high levels of inflation have all had a dramatic impact on employee morale in recent months, which in turn have a negative effect on workforce productivity.

"In the early days of the recession, there seemed to be something of a 'Blitz spirit', with workforces helping their employers to weather the bad times by accepting pay freezes or even cuts," said Dilys Robinson, principal research fellow at the Institute for Employment Studies (IES).

She warned, however, workers will soon start thinking "enough is enough."

The challenge for HR managers is finding a way to provide these workers with adequate compensation, with continuing limited resources and little sign of the economic downturn ending anytime in the near future.

Engaging Staff

Dilys Robinson from the IES believes that workers are still not expecting to receive increased financial rewards for their work. Rather they expect recognition from managers for the role they play within the organization and for senior staff to listen when suggestions are made.

"Here non-financial rewards often go a long way - an extra day's holiday after working very hard, perhaps, or even a simple 'thank you' in person or in writing from a senior manager.

It also helps if communication is clear and two-way, for example employees can make suggestions, which are listened to," she explained.

It is the personnel who are on the front-line dealing with staff everyday who need the required training for motivating the workforce and ultimately increasing productivity.

Robinson described the relationship between line managers and workers as being "very important," as they are likely to have day-to-day contact senior managers will not have with staff.

"It is often the line manager who is predominantly responsible for the mood of the team, and an effective, encouraging, engaging manager can motivate the team to produce excellent results even when times are difficult," Robinson said.

Employee Benefits

Predictions are that flexible benefits packages are likely to increase in popularity in the coming months, which will bring advantages to employees at no extra cost to employers.

Diana Bruce, policy liaison officer at the Chartered Institute of Payroll Professionals, said: "Employees will hopefully feel the benefit by being given the option to adjust or increase their benefits in kind –whether that be through childcare provision or private health insurance."

One specific example Bruce highlighted was companies allowing their employees to buy additional leave, or sell any unused holiday, which could improve "the package" for staff without any additional financial burden.

Research conducted by first direct also suggested something as simple as introducing casual dress in some work places could boost output, with a third of respondents stating they felt this would have a positive effect on work place productivity.

"Employers need to keep communication open at all times and find other ways of motivating staff. Not everybody is driven by an increase in salary," she added.

One company which has introduced an employee benefit scheme to great success is National Grid. Since December 2009 the firm has been offering a discount scheme with various retailers through P&MM, a marketing services agency that specializes in performance improvement, recently adding re-loadable cards for the supermarkets Sainsbury and Asda to the list through the provider's digital platform.

Nearly a third of the firm's 10,000 workers are registered with the scheme, according to, which allows them to access discounts through online voucher codes, cashback, SMS codes and the telephone.

Caroline Adams, employee benefits manager at National Grid, told the news provider: "The new website will not only aid us in offering our staff a vast array of discounts but will help us boost employee engagement.

It is a very effective way of rewarding and helping our diverse workforce make the most of their income."