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With organisations facing a challenging recruitment and retention landscape in 2024, how can firms attract, reward and keep the best people? Alasdair McGill is the founder of Dundee based accountancy firm Ashton McGill, and Entrepreneur in Residence at the University of Dundee, and offered this advice:
Winning the war for talent
“The biggest challenge out there at the moment for organisations is finding the right people and when they do, it is costing them more to engage them. In the old days, the power was with the employer but today it’s a different balance and employees are looking for more. For organisations, this often means thinking beyond salary to other key considerations for employees such as culture, working environment, hybrid working opportunities, and rewards and incentives programs.”
Develop rewards in line with your financial year
“With many organisations finishing their financial year in December or April, the beginning of the year is an ideal time to start thinking about rewards and incentives for staff. It’s important to try and align plans with the end of your financial year in a structured fashion, building out rewards and incentives forecasts as part of the organisation’s overall strategy rather than the two being out of sync. It is definitely worthwhile speaking to your accountant if you’re planning a new rewards initiative for staff.”
Discover your purpose
“Increasingly, when making career decisions, employees are looking to an organisation’s purpose for ‘fit’, particularly Gen Z and Gen Alpha. As an organisation, your purpose should move beyond pure profit generation to why your brand exists, your motivation, your ethics, and the benefit you provide to the world. Development of your purpose can help your organisation to attract staff who share similar values.”
Consider employee ownership models
“Organisations who don’t have the budget to pay their staff more as a way of attracting or retaining them can potentially look at offering a larger compensation package overall by looking at initiatives such as employee ownership models and performance targets.”
Help staff feel the benefit
“The trivial benefit scheme is a useful piece of legislation that allows organisations to gift staff a non-cash reward of up to £50 multiple times throughout the year. Gift cards like Town & City Gift Cards work well because employees treat them differently to cash. If you give staff and extra £50 in their pay, firstly they will pay tax and national insurance on the £50 so they will only receive two thirds of that, and secondly, it goes into their bank account and gets lost amongst all of the credits and debits, so they never really feel the benefit of it.”
Think about the ‘why’
“A key point to note when using the trivial benefit scheme is that it can’t be linked to performance because it would be considered by HMRC as compensation as part of the employee’s salary, and therefore taxable. Consider other reasons for rewarding staff, such as the fact they’ve been working hard, or because you want to use local gift cards to support your community. A note is that directors of a company can only receive a total of £300 under the trivial benefit scheme in any one tax year.”
Surprise and delight
“If you’re using gift cards through the trivial benefit scheme, the ‘surprise and delight’ method can work well. At Ashton McGill, when my son got married last year, we gave all of our staff a Town & City Gift Card as a surprise. We repeat this process randomly throughout the year, at times like Easter or the summer. Because it’s unexpected, it can motivate staff more than an anticipated reward.”
Help your staff feel the benefit of a local reward!
