Are Salary Sacrifice Schemes the Key to Attracting Top Talent and Retaining Employees?

So, the question remains: Could salary sacrifice be the solution? We'll explore how these schemes not only revolutionise employee benefits but also significantly boost retention rates, providing a strategic advantage for employers.

Employee turnover is a fact of life for every business. While a 10% annual rate might be considered healthy, high turnover can quickly become a financial headache. Companies struggling with retention often find themselves trapped in a vicious cycle: poor work environment, low morale, and difficulty attracting new talent. This, unsurprisingly, leads to even higher turnover rates.

The true cost of replacing an employee extends far beyond the initial hiring process. A recent study by Oxford Economics revealed that for employees earning £25,000 or more, the average cost of turnover can reach £30,614. This includes expenses associated with training, recruitment, and salary. Imagine these costs constantly recurring due to a revolving door of new hires!

The good news? This cycle can be broken.

The solution lies in prioritising employee retention. By creating a work environment where employees feel valued and invested in their roles, companies can significantly reduce turnover and its associated costs.

One key strategy is offering a competitive benefits package. Competitive benefits go beyond just salary and can significantly impact employee satisfaction and loyalty. Salary sacrifice schemes are a valuable tool in this regard. They allow employees to receive benefits like childcare vouchers or a car for a reduced salary, lowering their taxable income. This not only enhances employee well-being but also serves as a powerful incentive for attracting new talent in today's competitive job market.

By focusing on employee retention through a comprehensive benefits package, companies can break the cycle of high turnover and reap the rewards of a stable and engaged workforce.

Salary sacrifice isn't just about saving a few pounds on benefits – it unlocks the opportunity to drive a brand-new car at a low affordable cost.

Cars are a significant financial burden. In recent years, their purchase price has skyrocketed, and so have maintenance and running costs. Salary sacrifice offers a solution:

• Drive a brand new electric car: Salary sacrifice allows you to get a brand new car, at a much more affordable price.
• All expenses covered: Forget worrying about insurance, tax, maintenance, roadside assistance, or even an upfront payment. Salary sacrifice takes care of it all.
• Reduced maintenance: With a new car, there's less chance of breakdowns, saving you money and hassle. You also avoid MOT costs for the first three years.
• One fixed monthly payment: Unlike traditional leases with upfront costs, salary sacrifice offers a single, fixed monthly payment tailored to your needs – choose the car, mileage, and contract length that fits your budget.
• Reduced tax and National Insurance: Because the lease cost comes out of your gross salary before tax and National Insurance are calculated, you pay less on these contributions.

Salary sacrifice isn't just about keeping your existing employees happy. It's also a powerful tool for attracting top talent in today's competitive job market. When highly skilled candidates are evaluating job offers, a comprehensive benefits package can be a major deciding factor. Salary sacrifice offers a unique advantage by providing significant cost savings on desirable perks like brand-new cars. This not only enhances employee well-being but also demonstrates your company's commitment to offering a competitive compensation package that attracts and retains top performers.

• Attract top talent: In a competitive job market, the ability to drive a brand-new car with significant cost savings is a major draw for high-quality employees.
• Promote eco-friendly choices: When you offer EVs as part of the salary sacrifice scheme, you not only incentivise employees to switch to environmentally friendly vehicles but also contribute to reducing your company's indirect emissions.
• Lower National Insurance Contributions: As an employer, you contribute National Insurance (NI) on top of your employee's salary. With a reduced gross salary, your NI contributions automatically decrease, leading to direct company savings.

While a healthy level of employee turnover is inevitable, high turnover rates can significantly impact a company's bottom line. Salary sacrifice schemes have emerged as a strategic tool for mitigating these costs and fostering a more engaged workforce. By offering employees access to significant cost savings on desirable benefits, companies can enhance employee satisfaction and loyalty. Additionally, salary sacrifice programs can contribute to attracting top talent in a competitive job market.

Get in touch with one of our experts to learn how we can assist you on Salary Sacrifice journey. Call us at 0800 032 1433 or email us at info@fleetsauce.co.uk.