What does the Future of Employee Benefits Look Like?


Talk to Mark:


As you will all be aware, this year we have seen a reduction in the Lifetime Allowance (LTA): the amount of tax-free savings an individual can have in their pension fund upon retirement has been reduced from £1.25 million, for the tax year 2015/16, to £1 million, for the year 2016/17.[1] Any pension fund exceeding the £1 million LTA will be taxed at a rate of 55% on anything taken as a lump sum and at 25% if the excess is taken as an income (such as a scheme pension or annuity).[2]

Consequently, it would be fair to imagine that we will see a wider range of workplace saving solutions being offered as employees shy away from the potential expense of saving into a pension fund, instead seeking alternative means of saving. Investment is bound to be seen as a popular alternative. Employees will want to be educated on the subject of investment and employers may well have to provide that education.

It is impossible to discuss the future of workplace benefit schemes without highlighting the role of technology. The recent boom in wearable technology signals the end of one-size-fits-all benefit schemes. Increasingly we have seen attention being focussed on work/life balance; the truthful notion that happy, healthy workers are more productive has become quite ubiquitous. For some time now employees have been encouraged to monitor their health via healthcare apps on mobile devices. And whilst digital medicine is entering the mainstream – via smartphone apps, smartwatches and smartshirts – the UK’s population is ageing, as is its workforce. Employers will feel the need to monitor the individual health of their ageing workforce and will be able to do so, thanks to advanced wearables.

Employee benefit packages will also be centred on individual health. Specifically designed healthcare apps will become ever more prevalent: employers will be able to use these apps to monitor employee activity levels, blood sugar levels, and so on, as well as to communicate benefit packages to employees.

Employees and potential employees will seek jobs that offer health-centric benefit packages. And as wearables become increasingly popular, health packages will need to reflect that. Packages will need to be far more personalised and built upon each individual’s personal health data. Employers will be able to gather real-time data from their employees, allowing them to monitor their activity levels, their blood sugar levels and so on. This will enable employers to derive a real sense of the wellbeing of their employees and conversely, the causes of poor health.

It is important that benefit packages can be communicated to employees individually and at all times. In the UK, the number of smartphone users is set to rise to 46 million by 2018.[3] Employees will want to access their benefit platforms at all times, no matter their location. Consequently, benefit platforms will have to become increasingly accessible, self-serviceable and interactive. Information is increasingly being presented in a variety of formats: I would imagine that we will see more video content being used to explain how different benefit platforms should be used and how to access benefits.

The future of employee benefits is one that is tied to technology. As technology becomes ever more personalised, it will be possible for benefit schemes to be similarly personalised. Overall we will see schemes tailored to the individual employee. Employers will benefit too, from a workforce that is happy, healthy and taken care of. As long as benefit platforms are able to keep up with employee/employer demands for efficiency and accessibility, the future of benefits will indeed be bright.


Mark Howlett

Chief Executive



[1] Pensions Advisory Service, Lifetime Allowance Spotlight April 2015.

[2] Pensions Advisory Service, Lifetime Allowance Spotlight April 2015.

[3] http://www.telegraph.co.uk/technology/mobile-phones/11287659/Quarter-of-the-world-will-be-using-smartphones-in-2016.html