We could well be exiting the longest period of falling output since records started and unemployment is likely to continue rising for some time. So why think about employee benefits now?

The answer is simple; those businesses that have survived this difficult period have frequently done so by being able to react quickly to changing market conditions and also, in many cases, by investing in their most valuable resource – their employees.

On the other hand, they have also probably avoided spending money unnecessarily. So the question becomes: is providing additional employee benefits a necessary – or cost effective – expense?

Investing in the future
Having survived the recession, most businesses will have the workforce they want and can move forward with. However, many firms that retrenched during the recession may find that they now have to compete aggressively to recapture employees whom they let go in order to save money. This could result in a wage and benefits war.

While your employees may well feel a high degree of loyalty to you for keeping faith with them through the hard times, it could be difficult for them to rationalise rejecting a more beneficial package from a competitor, should one be offered. It is therefore worth considering how you can enhance your employee benefits package now.

Not necessarily a 'cost'
It is not that insurance companies have suddenly decided to provide medical insurance free; more a matter of looking at the overall costs. You pay the premiums, of course (although these are currently an allowable business expense for tax purposes) but by giving employees access to top quality medical care at a time when it suits them – and your business’s operational needs – there are potential savings to be made, compared with allowing them to rely on National Health Service appointments and delays. What is more, the chances are that with high quality private treatment, they could be back at work more quickly – saving you even more.

Options
There are a range of covers available to reflect your business’s individual needs – and those of your employees. For example, some forms of psychiatric covers are sometimes excluded from standard policies but can be included for an additional premium. Similarly, costs can be reduced if employees pay the first part of any claim themselves, or if consultation fees are excluded.

Importantly, group schemes are almost invariably less expensive than individual ones, so by providing medical insurance for your employees, you are securing a lower overall cost than if each arranged their own cover.

And some schemes now also give access to health and fitness clubs at heavily discounted rates, so you could find your workforce has even less downtime due to ill health.

As with any form of financial decisions, it is important always to seek independent financial advice before making any decision regarding your finances.

NOTHING CONTAINED IN THE ARTICLE SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE. PLEASE NOTE THAT THERE MAY BE VARIATIONS FOR THOSE LIVING IN SCOTLAND AND NORTHERN IRELAND.