Politicians and civil servants have coined a new buzzword – JAMs, a term that refers to individuals and families who are ‘Just About Managing’.
Prime Minister Theresa May offered a helpful definition in her first speech: “You have a job but you don’t always have job security. You have your own home, but you worry about paying a mortgage. You can ‘just about manage’ but you worry about the cost of living and getting your kids into a good school.”
Employee benefits can play an important role in helping JAM workers – particularly those that are often overlooked – maintain or improve their health, wellbeing and living standards by covering or contributing to essential costs.
According to a study on perceptions of benefits and wellbeing schemes from PMI Health Group, only 44 per cent of employees are happy with the benefits they receive and only 37 per cent said their employers make provisions to look after their health and wellbeing.
Although employees may have a tax liability on benefits, this will not always be the case. Moreover, a tax liability can be outweighed by the benefits the employee receives. PMI Health Group reveals some of the cost-effective options available for employers.
1/ Cash plans
Cash plans are low cost policies, costing from as little as £1 per employee per week, used to provide an easy way to pay for essential healthcare – when individuals are ill, and when they’re not.
Cash plans will pay individuals cash benefits for time spent in hospital, either as inpatient or for consultations, or for pre-defined treatments such as dental, optical, private consultations, physiotherapy, chiropractic, and osteopathy.
Higher end cash plan benefits can play a key role in absence management, from high-tech scans and Cognitive Behavioural Therapy, to access to wellbeing websites, online health risk assessments and discounts for gym memberships.
2/ Dental plans
One of the most commonly claimed for treatments on cash plan – dental charges – can be covered in isolation under dental plans.
Group dental plans cover employees for both preventative and restorative dental treatments. They can also cover the cost of more serious and costly accidents and injuries.
To maintain good dental health, dental costs are, in the main, unavoidable. With the number of NHS dentists on the wane however, there is an increasing likelihood that increasing costs may cause JAM employees to neglect their teeth
At an average cost of around £10 per employee, per month, dental plans are proving an increasing popular employee benefit. Furthermore, they encourage people to see the dentist regularly, leading to better dental health which is increasingly being linked to general health and wellbeing.
3/ Employee Assistance Programmes
Employee Assistance Programmes (EAPs) provide confidential advice, support, and counselling to staff with personal or work-related issues.
Problems faced at work or at home can affect an employee’s performance during the day or even result in stress-related absence. EAPs can help tackle these problems.
Costs vary but at around just £15 per employee per year, they offer one of the most affordable benefits on the market. What’s more, they represent an employer’s commitment to taking preventative and protective measures to reduce health risks in the workplace, in line with the Health & Safety at Work Act of 1974.
4/ Financial education
Financial stability is the biggest factor affecting people’s wellbeing, according to a recent research report by health and wellbeing charity Central YMCA.
The impact of personal finances is likely to be even more acute among the JAM population, but financial education programmes can help by enabling them to better manage and make the most of their money.
What’s more, by reducing stress, employers may benefit from reduced levels of sickness absence and higher levels of workplace productivity.
Financial education can cover a wide range of areas from benefits, such as share plans and pensions, to tax planning and savings strategies. Employers must ensure, however, that when providing financial advice, they employ the services of Financial Conduct Authority (FCA) regulated advisers.
5/ Group Life
Group Life insurance premiums have the advantage of not being treated as a benefit in kind for employees.
In the event of an employee death, the benefit pays a tax free lump sum to the employee’s family.
Benefit levels on these Death in Service’ schemes will, as a rule, pay up to four times an employee’s annual salary, depending upon the scheme. This may negate the need for an employee to pay for a separate life insurance policy to cover mortgage payments and other financial commitments.
6/ Group Income Protection
Long term illness can cause considerable financial strain for employees. A Group Income Protection policy offers a reassuring safety net, paying a proportion of an employee’s salary in the event they are off work due to long term sickness or injury.
The employee can also benefit from rehabilitation schemes provided by the insurer. In addition, as with Group Life, the employee has no benefit in kind tax liability to worry about.
7/ Voluntary discount and voucher schemes
Voluntary benefits such as retail and leisure discounts can help employees’ take home pay go that little bit further – and such discounts may not be available to employees elsewhere.
Gym membership discounts or access to online discounting websites, where employees can get money off everyday shopping from high street brands and cash back on their purchases, can prove popular.
Such schemes may go a long way to boosting morale among JAM employees and promoting good workforce relations.