How to select the right employee benefits consultancy for your business
In today's competitive job market, a comprehensive and well-communicated benefits package can be the key to attracting top talent and keeping your current employees happy, healthy and engaged.
Partnering with the right employee benefits consultancy can unlock the door to an employee benefits package that meets your employees’ needs and fits with your budget. A skilled consultancy will not only help you design a benefits package that meets the diverse needs of your workforce, but they'll also help you communicate its value – a key area where most packages fall down.
· The value of an employee benefits consulting company
· Why are employee benefits important?
· What services do employee benefits consultancies offer?
· What’s the benefit of using an employee benefits consultancy versus implementing benefits yourself?
· Selecting an employee benefit consultancy – a step by step guide
o Step 1 – Review the employee benefits you currently offer
o Step 2 – Take stock of your current workforce numbers and demographics
o Step 3 – Create objectives about what you want to achieve
o Step 4 – Start researching potential consultancies
o Step 5 – Draw up a shortlist
o Step 6 – Make a final decision
o Step 7 – Build the partnership
The value of an employee benefits consulting company
With 63% of employees saying that employee benefits have become more important when deciding where to work – rising to 72% for those aged 34 and under[1] - it’s clear that a well-designed employee benefits package is critical when it comes to recruiting and retaining talent.
For many small and medium-sized businesses with lean HR teams, creating an effective employee benefits strategy that supports all aspects of employee wellbeing while aligning with wider business objectives can be overwhelming. Making sure the strategy is flexible, relevant and sustainable has become a much more difficult task over the last few years as the number of providers has mushroomed along with the range of benefits - and technology - available.
An expert employee benefit consultancy firm who is focused on this single area and knows the sector inside out can be invaluable in providing independent advice. Regardless of whether you’re a small business looking to implement your first employee benefits, or a large corporation looking to review and optimise what you already offer; they have the time, experience and know-how to explore the options and build a package that works hard for your business, budget and employees.
[1] Most employees would switch roles for improved workplace benefits
David Pugh, Managing Partner, ilumiti
"At ilumiti, we believe that employee benefits should be more than just a box-ticking exercise. We work closely with our clients to understand their unique needs and create a benefits package that truly empowers their employees. We're not just brokers; we're partners in their success."
Why are employee benefits important?
Despite the rise of AI and technological advancements, machines haven’t replaced humans just yet. Attracting and retaining the best employees remains crucial. Today’s employees want to work somewhere they feel valued and accepted, where their efforts are appreciated and make a difference. Somewhere that acknowledges and supports their life outside of the workplace.
The reward and benefits that a company offer speaks volumes. It visibly demonstrates their attitude towards employees and the support they are prepared to offer. Failing to have the right employee benefits in place - which include everything from pensions and insurances through to mental health support and access to fertility services - can not only make it more difficult to attract the best talent, but it can also create an environment that fosters ill-health, low engagement and reduced productivity.
This growing focus on employee benefits is driven by a number of factors, including challenges accessing timely care through the NHS, growing waiting lists for treatment, and the ongoing impact of the cost of living crisis. Social factors are also fuelling this demand. The UK’s ageing population means more employees than ever before have caring responsibilities. There is also an increased awareness around the need to engage with pensions earlier to achieve better and more comfortable retirement outcomes as many employees choose - or need - to work for longer.
What services do employee benefits consultancies offer?
An experienced employee benefit consultant, also known as an employee benefits broker, will be able to support any size or type of business to create a package that is relevant to their objectives and the needs of their employees. Some of the services they can provide include:
Benefit strategy and design
Your employee benefit consultant will be able to give advice across a range of benefits, covering key areas such as health and protection, wellbeing and workplace pensions. It is their job to know who the providers are in the market, what services they offer and how they match with your requirements.
They can help you understand your current strategy’s strengths and weaknesses by conducting a thorough analysis of your offerings, delving into utilisation data, employee feedback, and market trends. This deep dive allows them to identify any gaps or areas where your benefits may be falling short of employee expectations or competitive standards.
As well as advising on the types of benefits available, they can also help you build a coherent benefits strategy and offer guidance on benefits design and relevant employee benefit technologies. Knowing which benefits work in partnership, offering complementary support and illuminating any crossover or duplication, can provide significant savings.
Benefits management and administration
Once your employee benefits are in place, your benefits consultant can help you with ongoing management. They can review your package periodically to ensure it remains fit for purpose as your employee demographic changes along with the employee benefit landscape, and employment legislation.
They can also ensure your strategy is sustainable over time by helping you to manage costs, such as the growing cost of private medical insurance (PMI). They can assess health and people risks, explore alternative suppliers and offer solutions to maximise your budget while ensuring your benefits remain effective.
They can also do much of the administration required – including leavers and joiners to your company, and claims management - which can be incredibly time consuming, draining the resources of smaller HR teams.
Benefits communication
Employee benefits only realise their true potential if employees know about them, understand them, and know how to access them. Benefits communication is crucial. This is an area where employee benefits consultants can make a huge difference. Working in tandem with providers, they can help employers devise innovative and effective communication strategies showcasing the value of what’s on offer.
Dan Mills, Creative Director, ilumiti
“Communicating employee benefits is an art. It's about crafting a story that resonates with employees, showcasing the value of their benefits package in a way that's clear, engaging, and inspiring.”
Multi-national and global benefits
The rules and cultural norms around employee benefits tend to differ country by country. Understanding what is available and how legislation differs can be a challenge. An employee benefits consultant will have invaluable knowledge of other markets around the world and be able to advise on the best course of action for employers operating in multiple territories.
What’s the benefit of using an employee benefits consultancy versus implementing benefits yourself?
As employee benefits represent the second largest people cost behind salary, it makes sense to ensure this money is spent as efficiently and effectively as possible. Using the expertise and insights of a consultant, who knows the market inside out, will ensure you get maximum value for your budget. You’ll also benefit from:
Benchmarking data
A key reason for implementing employee benefits is to attract the best talent, so it’s vital for employers to know whether what they’re offering is on par with or behind the norm for their sector. Many employee benefit consulting services offer benchmarking services which compare the benefits you offer versus your competitors, so you can see how you match up and potentially bridge any gaps.
A single point of contact
There are now hundreds of different employee benefit providers. Even just providing a limited package which encompasses a workplace pension, basic insurances and health support is likely to involve several different suppliers. A more extensive package can involve dozens. An employee benefit consultant can take on the role of being the main liaison with all third party suppliers, cutting down on the administration required and saving valuable time.
Value for money
As well as being able to get the best deals for you with providers, your consultant will also be able to advise how you can get the most value for your budget. This can include suggestions on how to optimise the level of benefits you offer - for example, reducing the level of life insurance you offer from 4 x salary to 3 x salary to free up budget - as well as advising on the different funding options such as flexible and voluntary benefits.
Trend spotting
The workplace is evolving at a faster pace than ever before. An ageing workforce has exacerbated the cost of chronic ill-health and sickness to businesses. Concerns about retirement adequacy, employees juggling work and child or eldercare, diversity equity and inclusion (DEI), and preventative wellbeing have all become areas that employers need to consider.
To meet these challenges, a plethora of new benefits have emerged into the market, such as those providing menopause support, access to fertility advice and neurodiversity assessments. Other suppliers offering eldercare, parenting advice and help for first-time home buyers have also appeared in response to the emerging needs of employees.
An employee benefit consultant will have their eyes firmly trained on the future, ensuring employers are aware of innovations, but also, importantly, which ones are relevant to their business.
A partner who understands your business
The most effective employee benefits strategies are linked to overall business objectives and employee needs. These will be unique to each organisation and will evolve overtime.
A recent survey showed that most employers (58%) do not have an in-depth understanding of their employees’ health and wellbeing needs, with less than half strongly agreeing that they understand their employees’ financial (44%), social (40%), mental (43%) and physical (42%) needs[2].
Building a partnership with a consultant over a period of time, means they get to understand your workforce and goals so they can proactively offer employee benefits advice and recommendations. Part of this will be ongoing evaluation to assess the performance, use and suitability of benefits over time
Peace of mind
Employee benefit consultancies will advise you on the latest regulation and employment legislation and advise how you may need to amend your benefits to stay compliant.
For busy HR departments, this can be invaluable especially when you consider that a YouGov poll carried out in January 2024 found that 43% of employers were unaware that from 6 April 2024 their employees would have the right to ask for flexible working from day one of their employment[3]
[2] More than half of employers are unaware of employee wellbeing needs
[3] Many employers unaware of new law changes to flexible working
David Pugh, Managing Partner, ilumiti
“Navigating the world of employee benefits can be complex. At ilumiti, we guide businesses through the maze, helping them build a benefits strategy that supports their employees' wellbeing and aligns with their business goals."
Selecting an employee benefits consultancy – a step by step guide
If you’re thinking about using the services of an employee benefits consultant, the following steps can help ensure you approach the exercise pre-armed with all the information you need to get the most out of the experience:
Step 1 – Review the employee benefits you currently offer
Draw up a list of the employee benefits that you currently offer and to whom in your workforce you offer them. Include all benefits regardless of whether you’d class them as a benefit, perk or more part of your company culture. For example: life insurance, cycle to work, flexible working, volunteering days, training budgets, etc.
Consider how effective they are – do your employees engage with them? What’s the take-up rate? Have they achieved what you hoped they would, e.g. helped you to recruit new talent? Do they meet your employee needs? To help you answer these questions, you could use data from your employee benefits platform, claims data, usage stats and employee surveys.
Another important consideration is whether your current employee benefits package meets your business’s needs? Is it easy to administer? Does it come in within budget? Does it help you achieve your broader business objectives?
Step 2 – Take stock of your current workforce numbers and demographics
Depending on how long ago you implemented your employee benefits, it’s possible that your workforce numbers and demographics have changed. Before engaging with a consulting company, it’s useful to have the current split to hand. For example: total number of employees, split of male, female and non-binary; split by age-band; split by working location; split by working hours, e.g. part time, shift workers, etc.
Step 3 – Create objectives about what you want to achieve
When you originally implemented your employee benefits, you probably had an objective you wanted them to help you achieve, such as to improve employee retention, reduce sickness absence or help you to recruit a certain demographic. Over time, it’s likely that your objectives will have evolved and, as a result, your current package no longer meets them.
Discuss objectives with your key stakeholders and gather information about the needs of their business areas, particularly those areas that need attention. Use this information to start thinking about how you could use employee benefits to support wider business objectives.
Step 4 – Start researching potential consultancies
Choosing the right employee benefits consultancy is a significant decision. It's about more than just ticking boxes, it's about finding a partner who understands your business, your employees, and your vision for the future.
A good place to start researching potential consultancies that you might like to partner with is seeking recommendations from peers or HR or reward groups that you may belong to. Word of mouth is always one of the best recommendations. While most brokers and employee benefit consultancies work with businesses of all sizes, some do specialise in the size of businesses they support, for example, larger employee benefit consultants may have broader global knowledge and affiliations that would make more sense for a large corporation.
Consider what kind of consultancy would suit your business – how much support do you need and what type of relationship do you want?
Step 5 – Draw up a shortlist
Once you’ve drawn up a list of possible partners, decide on the attributes that are most important to you, such as:
Industry expertise and specialisation
Consider how long the consultancy has been in business and the types of customers they have. The world of employee benefits is constantly evolving, with new legislation, innovative products, and shifting employee expectations; do they demonstrate in-depth knowledge of changes in the market and upcoming trends?
Range of services and customisation options
Partnering with a consultancy that offers a broad range of services and customisation options – such as benefits strategy, technology and platforms, and benefits communication - helps future-proof your relationship together, ensuring they have the capabilities you may require at a later stage.
Reputation and client testimonials
Client testimonials and case studies are a great way of hearing about the consultancy’s experience and track record of success. Do they have lots of long-term clients? Don’t be afraid to ask to speak directly with some of their clients to get first-hand insights into their service quality and responsiveness.
Technology and innovation in benefits solutions
From flexible benefits platforms and online enrolment portals to AI-powered communication tools; innovative solutions are transforming benefits delivery, so consider how important the latest innovations are to your business. Ensure the consultancy are well-versed in the security and data protection aspects of these technologies.
Evaluating experience and professional credentials
Employee benefits consultancies may be authorised and regulated by the Financial Conduct Authority (FCA) and additional memberships to professional associations signal a commitment to ongoing learning and best practices. Don't be afraid to ask about this and also the wider team’s professional learning and qualifications.
Track record with similar businesses
When evaluating a consultancy, inquire about their experience with businesses similar to yours in terms of size, industry and demographics. This demonstrates their knowledge of the specific challenges and opportunities in your sector. Many also offer benchmarking services which can be extremely useful when conducted against your peers.
Transparency and communication
Prioritise a consultancy that values open communication and collaboration, acting as a true extension of your HR team. Ask to meet or speak to the team that will support you at the consultancy. Explore their approach to client relationships and their commitment to understanding your unique business goals.
Step 6 – Make a final decision
A true partnership thrives when both parties share a common vision. When evaluating potential consultancies, go beyond their technical skill and delve into their core values. A consultancy that aligns with your company culture and demonstrates a genuine desire to contribute to your success will be a much more valuable, effective and long-term partner
Providing your chosen shortlist have the attributes your business needs, the final decision really comes down to how aligned you feel the consultancy is with your business, how responsive they are and how you connected with the individuals that would be servicing you.
Consider which one understood and was aware of your specific needs, and which gave you the most confidence in terms of their ability to address your concerns. Involving key stakeholders from your organisation to gain diverse perspectives and ensure alignment across departments at this stage is essential.
Step 7 – Build the partnership
Once you’ve decided on which firm to go with, it’s time to set the foundation for a successful and mutually beneficial relationship.
Establishing clear expectations and agreements from the outset is key. Openly discuss your desired level of service, response times, reporting frequency, and any specific needs your HR department may have. Don't shy away from addressing potentially sensitive topics like cost structures, incentives, and the consultancy's approach to conflict resolution.
Once expectations are aligned, ensure all agreements are documented in a clear and concise contract. This protects both parties and serves as a roadmap for the partnership. Regularly review the agreement to ensure it remains relevant and reflects the evolving needs of your business and your employees.
Sean Phillips, Strategic Partnerships Director, ilumiti
"Building a strong partnership is crucial for success in employee benefits. At ilumiti, we believe in open communication, collaboration, and a shared commitment to achieving our clients' goals. We're not just a vendor; we're an extension of their team."
Frequently Asked Questions
What are employee benefit providers?
Employee benefit providers are companies who provide employee benefits. These can include insurance companies who offer a range of products such as life insurance, group income protection, PMI and critical illness cover; workplace pension providers; and companies who offer very specific benefits such as electric cars, child and elder care support, menopause support and fertility services.
What are the best employee benefits in the UK?
This depends on the make-up of your particular workforce. While retirement planning is an employee benefit that’s seeing significant growth as the UK workforce ages, your employees are unlikely to think this is the best employee benefit if their average age is 27. Be guided by your specific workforce demographic, asking what employees want, and ensuring customisation of the benefits you provide.
What employee benefits do employees want?
The employee benefits that employees want are generally a reflection of what life-stage they are at. While younger employees may favour volunteering days, gym membership and mental health support; older employees may value benefits such as child and eldercare support, benefits that protect the health of them and their loved ones, and retirement planning options.
What does an employee benefits consultant do?
An employee benefits consultant is like an architect for your employee well-being! They design, build, and manage a benefits package tailored to your company's needs and budget. Think of them as your trusted adviser, keeping you up-to-date on the latest trends and ensuring your employees feel valued and supported.
What is a good benefits package?
A good benefits package is like a well-balanced meal—it nourishes your employees with everything they need to thrive! It goes beyond the basics, offering a mix of health and financial benefits, lifestyle perks, and opportunities for personal and professional growth. It's a package that not only attracts top talent but also keeps your current team happy, engaged, and feeling valued.
Ready to transform your employee benefits programme?
Let’s connect and explore how ilumiti can empower your workforce and elevate your business. Schedule a free consultation today and discover the difference a true partnership can make.