There is an argument for giving staff access to ‘cafeteria style’ benefits, paid out of net taxed income. These arrangements allow employees access to ‘wholesale rates’, without tying individuals into employer-specific schemes. Then employees can establish a “personal benefit package” which, like a personal pension scheme, does not automatically end when changing jobs.
From the employer’s point of view, this makes TUPE transfers so much easier administratively. It also keeps contractual pay entitlements clear and simple, and avoids the need for contractual clauses making some or all benefits ‘non contractual’ or substitutable.
One of the ‘advantages’ of the old company-style benefits packages was that they promoted lack of pay transparency, but of course this is in fact a disadvantage, causing complications when it comes to diversity or equal pay.
Annabel Kaye is Managing Director of Irenicon Ltd, a specialist employment law consultancy. Tel: 08452 303050 Fax: 08452 303060 Website : www.irenicon.co.uk. You can follow Annabel on twitter – http://twitter.com/AnnabelKaye