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The Disappearing Benefits in the UK Workplace

By: Garry Crystal - Updated: 24 Mar 2012 | comments*Discuss
Perks Employees Disappearing Workplace

Many employee benefits are rapidly disappearing now that UK companies are tightening their belts. These cuts will not usually affect employee with contract stipulations but there are some benefits that are falling by the wayside.

Employee Perks and Benefits

Staff perks can range from the traditional free health insurance and gym membership to unusual perks such as free loft and wall insulation. Once an employee has these benefits they are usually taken for granted until they begin disappear. Cutbacks have forced many cash strapped companies to ditch a number of employee freebies. There are employees, such as London Underground, who have threatened strike action when employers decided to exchange tea urns for kettles. Employers do need to think carefully when taking the decision to ditch company perks.

Saying Goodbye to Employee Perks and Benefits

If a company has fallen on hard times then the perks and benefits are usually the first to go. This is usually the preferable option to cutting back on staff and most employees understand this. But many employees have chosen their employment companies with benefits and perks in mind. Getting rid of free fresh fruit may not make much of a difference to employees. But ditching free health insurance or annual bonuses could see disgruntled employees forming a queue to talk to the boss.

Common Disappearing Employee Perks and Benefits

Most employers who cutback on benefits will start off small. Among the common employee benefit cuts are:

  • Free breakfasts in the workplace
  • Taxis home for late night workers
  • Free tea and coffee
  • Extravagant Christmas Parties
  • Annual bonuses
  • Cancellation of gym memberships
  • Limits placed on staff discounts
  • Free meals for employees who work late

Notifying Employees of Cutbacks to Benefits

A smart employer will never just implement employee benefit cutbacks. Employees should always be informed of the intended cutbacks in person or through correspondence. This will give employees the chance to meet with employers if they think the issue is serious enough. Employers may actually negotiate with employees over which benefits and perks can be cut. This is the best option to take and should save employers the wrath of the workforce.

Employees Rights When Faced With Bonus Cuts

Losing annual bonuses such as Christmas bonuses will understandably upset and anger employees. But employers are within their rights to cut or stop bonuses if they are not contractually obliged to pay them. Many employee contracts do state that bonuses are discretionary, meaning it is the employer’s decision to pay them. Employers who use the ‘discretionary’ term may be on shaky ground when it comes to employment tribunals. Some courts and tribunals have found that the term ‘discretionary’ does actual create a legally binding contractual agreement.

Pay Freezes in the Workplace

Pay freezes are never good news but at times they can be a necessity, especially during an economic downturn. Pay freezes can sometimes be the only alternative to downsizing workforces and are usually a last resort. Freezes to pay can hit private and public sectors and can last for years. Employers know how severe pay freezes are to employees, and the uncertainty they can bring. But unless annual pay rises are stipulated in employee contracts this may be another case of biting the bullet.

How to Handle Disappearing Employee Benefits

Employees should remember that employee ‘freebies’ are not really free; they do cost the employer money. Employees who are facing benefit cutbacks shouldn’t storm into the boss’s office demanding they be reinstated. If the cutbacks are on a small scale then employees may simply have to bite the bullet and show some understanding. Larger benefit cutbacks can cause serious concern within the workplace. Talking to employers will help to clarify the situation and may actually bring out some alternative solutions.

Disappearing employee benefits and perks are bad news but they may be required to save an ailing company. Some benefits may disappear completely from the workplace but others may reappear once the economic downturn has ended. Employees who do face cuts to benefit and perk should think twice before threatening to resign. Talking with employers will be the best way to ensure that hasty decisions are not made due to employee benefit cuts.

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