Would you like to pay your workers more? Do your employees deserve a raise and do you want to motivate your staff effectively? There is only one answer to all these questions: flexible remuneration.
Flexible compensation has emerged as a key strategy in talent management and workplace wellbeing. This model offers employees the opportunity to personalise their compensation, tailoring it to their individual needs and lifestyle. We will explore some examples of this innovative approach and the advantages it offers for both employees and employers.
Discover our complete guide to Flexible Remuneration!
The flexible remuneration is a remuneration system that allows employees to choose between allocate up to 30% of your gross annual salary to different benefits. These benefits may include food vouchers, transport, childcare, health insurance, among others. By paying for these services with part of your gross salary, you are left with the following benefits exempt from personal income tax, This translates into a higher take-home pay, without increasing wage costs for the company.
The company establishes a flexible remuneration scheme with the services it wishes to provide to its employees. Once the plan is defined, employees are free to customise it voluntarily according to their needs. They can choose which services they want and what percentage of their salary they wish to allocate to each of them, considering that the personal income tax exemption applies up to 30 % of their gross annual salary.
Flexible pay is a way to increase the return on the salary your employees receive each month. With the same expenditure in euros, you give them a valuable source of profit, because:
- Your money is worth more. Every month they have fixed expenses, such as transport, childcare or meals away from home. But you can make it so that they do not have to pay income tax, thus increasing their purchasing power.
- You do not change their contribution base. They gain and, at the end of the month, they have more money available. But this does not affect the social security contribution base, which remains unchanged, unlike what would happen with a salary increase, for example.
- You adapt the benefits to your real needs at all times. When children are young, childcare is one of the main expenses in the household. After that, other expenses are prioritised, such as transport, for example.
With all these advantages of flexible remuneration, the company will soon see an upturn in productivity as a result of increased employee motivation.
In the medium term, flexible remuneration is an effective talent retention strategy. which also adds points to the popularity of your employer brand.
Implementing a flexible remuneration strategy does not entail any additional cost, as it does not involve an increase in salary expenses. However, it is crucial to select the right method of implementation. In order to do so, it is advisable to consider the following points:
- Inform staff of what flexible remuneration is and what it entails. We are at their disposal to answer any questions they may have and support their understanding of this new compensation model with tools such as a flexible remuneration savings calculator. .
- Personalise flexible remuneration as much as possible in each case. This means setting out the different options and examples of variable pay that exist and allowing employees to choose the benefits they prefer. Flexibility is important, to allow this policy to adjust to new needs of employees as they arise. For example, those who live far away from the company will benefit from a benefit to reduce the cost of eating out or a solution that saves on transport fares. But a parent with twins of pre-school age will probably prefer a discount on childcare costs.
- Choose a trusted solution. With options such as Transport Ticket, Restaurant Ticket or Childcare Ticket, Edenred offers flexibility, tax benefits, trust and personalisation, thus becoming a key ally to boost well-being, productivity and success at work.
More and more companies in Spain are choosing to offer flexible remuneration options to their employees. Do you want to know how to implement a flexible remuneration programme in your business? It is also essential to understand the difference between flexible remuneration and social benefits.
Flexible remuneration stands out as an effective tool to provide social benefits to employees, being considered by 80% of workers as the ideal complement to their salary. These benefits include:
These advantages not only benefit the employees, but also the company. A motivated employee is an invaluable investment.
Flexible remuneration stands out as a valuable tool for optimising workers' compensation and well-being. It offers employee benefits, Find out how to implement flexible remuneration with Edenred to improve your business!
