Friday 14 February 2014

Why should my company offer childcare vouchers?

Everyone knows just how beneficial childcare vouchers are to members of staff. Not only is the 20 per cent discount on nursery care really helpful for parents' wallets - but it also improves morale among employees and makes their home lives a little easier.
However, as with everything in business, it's all about the bottom line and companies must ensure there is a tangible economic reason as to why they should offer childcare voucher solutions to their personnel.
This blog post will quickly review the top reasons why executives shouldn't miss out on this trend:
Increased job satisfaction for employees
Job satisfaction isn't just a priority for employees - it's massively important for employers too. Executives at firms across the UK are beginning to realise they need to do more to keep their personnel on side or face higher turnover rates.
Not only is having your best and brightest leave - potentially to a competitor - a huge loss in terms of short to medium-term productivity, it also has a significant impact on the morale of co-workers.
Indeed, there have been many cases where a single individual moving on to another company has led to an exodus of employees, which nearly always causes substantial harm to the operations of a firm.
Reduced national insurance tax liability
Childcare vouchers schemes operate on a salary sacrifice basis (find out more here), meaning that those who use them pay for it straight out of their paycheck, bypassing a 20 per cent VAT charge in the process.
But this could also mean savings for your organisation, as this type of arrangement reduces the amount of money that employers have to pay in terms of national insurance contributions. Any businessperson will know just how much these taxes can harm a budget, so any opportunity to minimise tax liability through employee benefits should firmly be grabbed with both hands.
Research by benefits provider You at Work has shown that most companies that put a childcare voucher platform in place actually save money in the long run. Even when administration costs are factored in, the national insurance contribution reductions that build up over a number of years could really help your firm to reduce its HR budget.
If there's one word on the lips of the HR community in 2014 it is most certainly evangelisation, which is essentially the process of improving employees' lives to get them shouting from the rooftops about how great it is to work for you.
This is fantastic for your company and will help recruitment efforts in the future. If an applicant to a vacancy believes the firm they are applying for takes care of its workers, they will be much more likely to put their all into getting the job - allowing your recruitment team to more easily pick the best and brightest.
Picture the scene: one of your employees is at a creche, talking to someone who is taking their child to a session.
Your worker explains that they are saving £933 because of the platform your firm put in place and - not only will the other person be be green with envy - they'll also probably tell their friends that "Company Ltd saves their employees almost a grand through their benefits system."

Good press like this rarely comes along, so get on board and offer a childcare voucher solution today!

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