One of the key considerations for a business is how to motivate,
incentivise and ultimately keep valuable staff. The loss of
important personnel can be devastating to a business and the
disruption caused by staff members who are not motivated can be a
time consuming drain on productivity.
This has never been more important, particularly in Christchurch
where there is a significant shortfall of skilled labour in certain
The primary message to remember is that whilst salary or wages
are a significant component to attracting and maintaining a good
workforce, it is the additional factors and benefits provided by an
employer which often tip the balance in being able to recruit and
retain a stable, quality workforce.
A client recently came to us seeking to put in place a benefit
scheme for their employees that would incentivise them and maintain
a stable workforce as well as providing a more attractive offering
for potential employees. We worked closely with our client and
considered various options. There were many factors to consider
such as cost, tax implications, perceived benefit to employees and
overall value. Our client decided to offer the following:
A bonus payable upon performance measures being met;
Insurance to cover personal risk such as medical and life;
Extending, where appropriate, the use of company cars, mobile
telephones and laptops (which are used primarily for work) for
personal use outside of work.
We then set out the terms for each benefit to ensure that the
obligations of the employer and the rights of the employees were
For example, in relation to the bonus scheme, it is important
that the employer retains some discretion as to the payment. This
means that in certain circumstances, even if relevant key
components have been met but the business could not sustain a
payment, it could withhold that payment.
As you can imagine, such a policy has to be very clear and fully
understood by all parties.
In the current environment it is important that employees are
appropriately incentivised in order to maintain a productive and
stable workforce. Employers need to consider the benefits they
provide and the value to their employees in addition to a decent
There are many options to consider and many factors which may
influence the decision an employer makes regarding employee
Bonuses, insurance and other benefits such as cars and mobile
telephones are particularly good options but it is important that
employers have fully considered the implications of providing these
benefits. Employers must ensure that they have specific terms and
conditions (ideally set out in rules, schemes or policies) that
govern how and when these benefits are awarded to employees and how
the employees can benefit from them.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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