Your boss has set you the task of reviewing your organisation’s employee benefits package and benchmarking it externally to see how you compare against the market. If you haven’t undertaken an exercise like this before it might seem a little daunting, but in this post, I am going to share a few ideas on how you can obtain some external data for use in benefits benchmarking.
What is Employee Benchmarking?
Employee benchmarking is the process of setting standards and expectations for an employee’s work. These benchmarks are then often used during performance evaluations, pay reviews and can be used to decide the benefits each employee receives.
1. Existing network
I have previously started by asking members of my existing network for some help to compare my current employee benefits against those offered by other companies. In the past, I have used my Linkedin updates for this, but use caution as some companies may have policies against sharing information online. Most of us connect with others in the same industry so it could prove useful to reach out to them individually to obtain some data relevant to your industry.
2. Online forums
Business or HR forums provide a wealth of knowledge from others who have been looking for answers to the same questions as you have, so I would recommend searching for similar topics first. If the results are outdated or do not provide the information you need then post a new thread. Before you post up to think about what specifics you are looking for, e.g. are you looking to compare a single employee benefit like maternity pay, or compare against companies within the same sector? This way the results will be more meaningful than just asking anyone and everyone in HR what benefits they offer. It might take a little while to generate sufficient responses though.
3. XpertHR
This online service provides insight and data into most areas of HR. XpertHR has a section dedicated to Benchmarking of which Pay and Benefits are included. Not only do they provide answers to questions on the types of benefits other companies are offering, but they also drill down into specifics like costs and intentions to review or change benefits in the coming months. Whilst this source provides data relevant to individual sectors and geographical locations, it comes at a cost starting currently at £40 per month.
4. Best Companies
If you don’t have the budget to spend on data services then a great website I have used in the past is Best Companies. This requires some work, but the website breaks companies down into categories, e.g. Best 100 Small Companies, Best 100 Mid companies and Best 25 Big Companies or Best 25 Housing Associations. Within these categories you can view individual Company Profiles, which also includes Accreditation Profiles – this is where the employee benefits data is shown.
There is a list of benefits and the criteria which must be met to obtain this under each company, for example:
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- Holidays – Companies offering a minimum of 25 days annual leave
- Dental Insurance – Dental insurance offer to all employees
- Gym – On-site gym or subsidised gym memberships
- Childcare – On-site nursery or vouchers
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Unfortunately, this method doesn’t provide specifics, such as the exact number of days provided in the holiday allowance. However, it does provide an overview of what other companies and competitors are offering their employees.
Benchmarking employee benefits data
Gathering the data is the easy part, now it’s down to doing something meaningful with it. When I have previously undertaken benchmarking activities I have sought to answer three main questions:
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- What is my company offering above and beyond the market?
- What is my company offering which is in line with the market?
- Where is my company lacking in comparison to the market?
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Whilst answering these questions I would try to break the results down in comparison to the market as a whole, companies in the same sector and companies in a similar location. I would say the last two are of most importance though (i.e. competitors) as this is where employee benefits fit in with other strategies. For example, if you are using your employee benefits package to attract and retain the best people you can in order to gain a competitive advantage, you need to know where you stand in YOUR market.
Once you have benchmarked your employee benefits package it might be tempting to go off and look at providers for additional benefits, but I would next look at carrying out internal research and consider the demographics of your employees – this topic could form an entire article in itself!
