Attracting and retaining top talent is a key strategic focus for organisations of all sizes, no matter what the economic backdrop. Despite considerable challenges in the economic landscape, including the cost of living crisis and the ongoing transformation in workplace environments, almost two-thirds of Irish businesses view access to a skilled workforce as a constraint to growth.
So, with this in mind how best can companies attract and retain talent? Whilst many organisations still focus solely on salary, there is a trend towards the provision of a ‘total rewards package’, particularly for key employees. A well-structured key employee benefits package offers a way to attract and keep key executives within the company, as well as encouraging the required behaviours, achievements, values, and skills.
Pension Benefits for Executives
Offering a separate pension structure to your executives allows them more flexibility and tailoring in areas such as investment choices and how they take benefits when they retire or leave service. Even if the executives in your company have not requested a separate pension, you should consider offering it as part of your recruitment and retention strategy. More flexible pensions can enhance your executive benefits package significantly, so will likely be an important factor in attracting the best in the field.
Separate bespoke pension offerings don’t have to be for executives only. A company could offer them to any senior staff, once they reach a certain grade. This would boost an employer’s attractiveness to a wider range of recruits.
Another reason for offering a separate scheme is that the executives may have several old schemes they want to consolidate into one structure. However, advice in this area is key. Combining pensions – especially older occupational schemes – can have future implications, particularly when it comes to taking retirement benefits.
You could allow executives to pay contributions to a separate scheme of their choice. However, having multiple executive schemes with different providers is not often advisable, as this can be cumbersome administratively. It’s usually best practice to offer the same benefits across the same grade of employee, including at director level. The employer, with the help of an advisory firm can select one provider for all executive schemes.
Income Protection for Executives
Executive Income Protection is a cost-effective solution that allows employers to provide income security for company directors in the event of an unforeseen illness or injury in their business.
As executive income protection is taken out and paid for by the business on behalf of the employee, in the event of a claim the benefit is paid directly to the company who continues to pay the employee whilst they are unable to work. The premiums that are paid for by the employer qualify as an allowable business expense and can be offset against corporation tax.
Similar to a tailored pension offering, executive income protection can become an important part of a remuneration package and an effective feature to support the attraction and retention of key employees.
Life Cover for Executives
Executive Pension Term Assurance is a form of life insurance for employees, paid for by the employer. Typically, the cover will last until the executive leaves service or retires. The benefit is usually structured as a pay-out to the executive’s dependents calculated as a multiple of salary, often four times the individual’s final remuneration.
It is clear that in an ever-evolving employment environment, there are a number of tools available to employers seeking to structure attractive benefit packages.
As always, we are here to offer Employers and their Executives straightforward advice, to provide structured Financial Planning, and to offer comfort that these important aspects of your benefits packages are delivering for you and your key employees.
Talk to Harvest on 01-2375500 or email justask@harvestfinancial.ie and we will be delighted to assist.
