Employees increasingly value being able to tailor their salary to their lifestyle. A plan for flexible compensation allows the company to do so without increasing its costs. If you are wondering what is, how it works and how to implement it correctly, Here you will find a complete and practical guide to implement it in your organisation.
A flexible benefits plan (also known as a flexible compensation plan) is a remuneration system that allows employees voluntarily allocate a portion of their gross salary to benefits in kind, choosing between different goods or services with tax advantages.
These can include food vouchers, transport, childcare, training or health insurance, among others.
This way, the employee optimises their net salary without increasing the company's costs, and the organisation improves its remuneration policy and its ability to attract and retain talent.
In other words: It's a clever way to optimise payroll for both parties, as shown in this Example payslip with flexible benefits.
Before we start, do you know what the Social Benefits and Flexible RemunerationRead our article!
Implementing a flexible benefits plan requires planning and good communication. Follow these 6 steps:
Evaluate the plan's objectives (retention, motivation, taxation, etc.) and employee profiles. Listening to their needs will help you design a truly useful flexible compensation plan.
Expert advice: Carry out a brief internal survey to find out which benefits are of most interest before launching the programme.
Define which products or services will be available, respecting the limit of 30 % of the in-kind salary. Select a reliable provider that simplifies management and ensures tax compliance.
At this stage, it is important to meet with each employee to discuss how much of their salary they can allocate to the various services included in the plan and calculate the possible scenarios according to your needs. The duration of the plan must also be defined and the agreed conditions must be put in writing.
Ultimately, it's about designing a personalised flexible benefits programme, tailored to each employee's situation.
To ensure their success, it is crucial to clearly explain the tax and economic advantages This implies that employees will fully understand what they are selecting, avoiding misunderstandings or future surprises.
Once the collection system for each employee has been established, it is time to put it into practice. From here, the daily operational work begins: the monthly management related to product hiring, the preparation of payrolls, and the accounting record of payments made by the organisation.
It is worth noting that this management can be outsourced without incurring any additional costs. Currently, thanks to the platform Edenred Flex, Product procurement administration is much more agile and efficient. The time spent on these tasks has been significantly reduced, both for the company and for the employee requesting the solution.
Here you can see a Example payslip with flexible benefits!
Internal communication is key. Clearly explain the benefits, practical examples, and frequently asked questions. You can use information sessions, infographics, or short internal videos to increase adoption.
Review the plan's results: how many employees are using it, which benefits are most popular, and if satisfaction or retention has improved. Adjust the conditions according to tax changes or staff needs.
Throughout the process, there are intangible elements (beyond the Payroll calculations) that will impact the success of the flexible remuneration implementation:
Each company can configure its plan according to its workforce and budget. Some common examples are:
Once a flexible remuneration programme has been decided upon, it is necessary to choose who to implement it with. Flexible Remuneration from Edenred is perfectly adapted to the needs of each type of employee.
Thanks to its platform Edenred Flex, companies and employees can manage flexible remuneration easily and efficiently. Furthermore, Edenred offers comprehensive support, guiding companies and their employees throughout the benefits selection process, ensuring that each person finds the options that best suit their needs and lifestyle.
If you want to know more, discover our guide to Flexible Remuneration!
