Author: Becca Haywood

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Motivate staff with a benefit that appeals to all

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There aren’t many benefits that will appeal to the whole workforce. But technology products, offered through a flexible or voluntary benefits scheme via a salary sacrifice arrangement, are likely to appeal to everyone at some point. After all, most people today own a mobile phone, tablet or laptop.

So, why haven’t more employers implemented this type of scheme? It may be that they have concerns over administration, savings or simply do not have the time.

They may even recall the former home computer initiative (HCI) and the huge demand this generated. Nearly 10 years on from HCI, technology schemes are becoming popular again, driven by huge demand for devices, significant employer and employee savings and the ability for employees to pay back from salary over two years.

How does this work and what are the savings?

Home technology scheme

A home technology scheme provides a range of internet-enabled devices, including tablets, computers and smart televisions.

Employees are able to make savings of up to 26% on income tax and national insurance (NI) as a result of the salary sacrifice arrangement. After two years, the employee has the option to keep or return the product(s) with the full income tax charge only incurred if the equipment is kept at the end of the benefit period.

On returning the item at the end of the two-year period, the employee is able to recognise the recycling value of the returned item to get a substantial discount on a new device when re-joining the scheme.

Mobile phone scheme

Personal mobile phones and airtime contracts can be provided as a tax-free benefit under long-standing legislation that was revised by HM Revenue and Customs in 2012. Employees can choose from a wide range of phones, including the new iPhone 6.

Employees who already have business phones can also still take part. Higher-rate taxpayers can save 42% off the total price of a new handset with a two year contract. In addition, employers save on class 1A NI contributions on the total amount of salary sacrificed.

Can this support a bring-your-own-device (BYOD) model?

Organisations can utilise a technology benefits platform to reduce capital expenditure on IT in the workplace. Routinely called BYOD, this initiative is one where staff sign up to choose a phone, tablet or laptop from a range of products to use as a single device both in the home and at work. The scheme enables employers to offer staff their preferred device at a significantly reduced cost due to employer contribution, while, at the same time, reducing internal IT expenditure.

Where once employees would use a MacBook in the home and perhaps an older and less powerful laptop at work, the offer to choose one piece of equipment for work and home for a very small outlay is more popular than it might first seem.

Many staff are already allowed to use workplace PCs for some personal usage. A clear organisational BYOD policy supported by the right IT infrastructure can improve employees’ work-life balance and help to drive up morale.

By Clive Farrow, EmployeeChoice benefits consultant

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Results Exceeded Expectations with the Wheatley Housing Group

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The Client

Wheatley Group comprises of four social landlords, one care organisation and two commercial subsidiaries.

The group is named after John Wheatley, the former Glasgow MP who became known as the father of social housing. The group spans 12 local authority areas across Central Scotland, providing homes and award winning housing, care and social services to over 100,000 people.

Wheatley Group employs over 1,000 staff committed to ”making homes and lives better” for their customers. At Wheatley, ‘staff empowerment’ is not just a buzz phrase – it’s real. Through an award winning culture change programme, ‘Think Yes’, frontline staff are trusted to make decisions and design services tailored to individual customers.

The Employee Relations team at Wheatley take great pride in employee well being and offer an industry leading benefits package to employees, and where possible, flexible working arrangements.

 

The Requirement

On an ongoing basis the benefits package is reviewed to support Wheatley in attracting new staff and retaining the existing workforce. The package, which included Childcare vouchers and Bike schemes, had proved popular but wasn’t always applicable to the entire workforce. In reviewing the package, the Employee Relations team were looking for new and innovative offerings and found the Technology scheme ticked a number of boxes. Firstly, it would be of interest to most staff in the group, it would support staff to develop IT skills and the scheme was already being run by a large number of other public sector organisations.

As the result of an internal review, a tender process was undertaken through which Academia Group’s EmployeeChoice division was selected as the most suitable partner to provide the Technology scheme. This was the result of competitive pricing, experience and service levels.

 

The Goal

The Wheatley Group had 3 clear objectives in running a technology benefit:
• Provide staff with access to the latest tech products, pre-Christmas, at discounted prices
• Enable staff to spread the cost of the products over 3 years via salary sacrifice
• To generate a ‘buzz’ around the benefits package

To support this, EmployeeChoice provided marketing and communications to employees, a secure web store for employees to place orders over a 4-week period and a helpline for employees to raise queries.

The product range offered tablets, computers and other accessories from a range of manufacturers including Apple, Samsung, Sony and Toshiba. All products were provided with a carry case, 3 year warranty and anti-virus software, where applicable, to ensure the product was in working order throughout the hire agreement term

 

The Results

Interest in the Technology benefit was evident from the outset and was supported by product demonstrations at the onsite roadshow run by EmployeeChoice. However, results exceeded all expectations with approximately 40% of staff placing orders within the benefit window. Deliveries and stock was managed by the EmployeeChoice team with staff receiving products in time for Christmas – no doubt a logistics challenge given the volume of orders and time of year!

Employees recognised both the ability to spread payment but also the opportunity to save on Income Tax & NI through the salary sacrifice arrangement.

As an employer, the feedback from staff was excellent. Employees recognised the commitment the organisation has towards staff wellbeing. As an employer, the added benefit is reduced Class 1A National Insurance Contributions so the arrangement really does work for both parties.

The team at EmployeeChoice enabled us to run a very successful Computer Benefit scheme with a high percentage of staff taking up the offer. Their professional approach and ability to deliver products on time has led to excellent feedback from staff – we now plan to run the benefit on a regular basis.
Gillian McLaughlin – Employee Relations, Wheatley Group

 

View our latest Case Study by clicking the following link:

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Clive’s Corner: Our resident expert talks savings on tech

Clive's Corner 01

How can Salary Sacrifice be used to make savings on tablets, computers and smart TVs?

Whilst there are many organisations now running salary sacrifice benefits in the UK, it is always worth reminding ourselves exactly what the words mean. A salary sacrifice is an agreement between the employer and the employee to reduce the cash remuneration that is paid to the employee in exchange for the use of a non-cash benefit provided by the employer.

The provision of IT equipment can fit right into a benefits strategy through that arrangement. And the use of tablets, PCs, even Smart TVs, can also improve an employee’s awareness of and ability to manage IT changes in the workplace. Where the aim was once to join the digital revolution, the aim now is to keep up with developments! You can help your staff do that through a technology benefits programme.

According to the way you structure the salary sacrifice terms, your staff can enjoy tax advantages by opting to take IT equipment as a benefit. The legislation makes clear that, if an employer provides an employee with an ‘asset’ (as opposed to a ‘service’) such as IT equipment, a fixed proportion of the original cost is liable to income tax on an annual basis. We have a number of programme plans, over 1, 2 or 3 years, that can help you understand how this can be rolled out in practise to benefit everyone. We do not apply a one-size fits all approach; rather we work with you to ensure the best fit is made between your organisation and the available options.

For example, an increasingly popular choice is our 2 year ‘refresh or keep’ programme.

 

So how does that work?

Staff are offered a wide range of IT products via a 2 year salary sacrifice arrangement. At the time they are advised that at the end of the benefit period they will have a choice to return or keep the equipment. If they return it they can then enjoy a double-digit discount on their next choice, and by double digit we mean at least 15%, and up to 25%, depending on the product.

 

Why would anyone choose to do this?

Simply put, to make significant savings and keep up to date. We know a lot of people now look to refresh their tablets and laptops on a regular basis – the developments in technology almost demand this for entry level and mid-priced items! Through the salary sacrifice, they can enjoy the original products for the 2 years at a reduced cost by saving in tax and NI, and then by returning the products they can then access brand new products at way below retail prices; and then make tax savings on the use of those new products. We can provide the price discounts by recycling the old products and passing the savings on to them.

For those that wish to keep the products they have used over 2 years, once the salary sacrifice has closed there is nothing more to pay, but any income tax not paid on the value will need to be accounted for on their next P11D (or via payroll accounting). They will still enjoy NI savings through the salary sacrifice arrangement as well as our keen pricing and customer support.

Furthermore the website we built, for your staff to access and take part in the benefit, shows all the options and savings at a click.

 

 

Northumberland, Tyne and Wear NHS choose us!

NHS Northumberland, Tyne and wear

The EmployeeChoice team are delighted to have been chosen to provide this service under a 4 Year Framework Agreement. The win highlights the growing trend of public sector organisations looking to run the Computer Scheme and is further testament to our competitive pricing and high levels of customer service. The Framework is expected to provide both the employer and employee with significant savings during the agreement with schemes running twice per year.

If you are a Public Sector organisation interested in offering this scheme then ask our team about current Frameworks that are in place that avoid the need to go through your own tender process. Simply email sales@employeechoice.co.uk for information.

Fife Council Computer Scheme a HUGE Success!

Fife Computer Scheme

Following a successful tender last year, EmployeeChoice was awarded the contract to run a Computer Scheme for Fife’s 17,000+ Employees.

Having completed the initial roll out we have delighted to have seen a take up of over 12% of staff therefore providing a substantial saving to the Council and generating great excitement amongst staff who were able to access the latest technology whilst paying for it over 3 years! Our managed service enabled around 2000 products to be delivered within a short delivery window at the busiest time of the year – so a big thank you to our project management team!

Mobile Phones are now available with a 2 Years Pre Paid Tariff !

2 Year Tariff

We have recently launched new tariffs on our Mobile Salary Sacrifice Scheme which allow employees to pay upfront for a 2 Year Personal Tariff. Whilst this is nothing new, the great news for employers is that this removes the need for monthly payroll adjustments caused by employee overspend.

With the new tariffs, employees have a Pay as you go element to the SIM card, which allows them to pay for additional data/minutes outside of the salary sacrifice arrangement. By paying upfront for a 2 Year personal tariff with a new handset, the employee is able to realise substantial savings vs high street prices. For example; a higher rate taxpayer can save £420 on a Tariff/Phone worth the cost of £1000 over 2 years. This equates to a whole 42% saving as a result of Salary Sacrifice!

 

 

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