Self funded benefits could be best for gig workers

Self funded benefits could be best for gig workers

There has been much press coverage about gig worker pay, conditions and benefits, but little discussion about the effects on companies. Flexible, self

There has been much press coverage about gig worker pay, conditions and benefits, but little discussion about the effects on companies. Flexible, self-employed work is nothing new but the way people find and access work is developing all the time, so this type of work is only likely to increase. The current lack of company-sponsored benefits offered to this group doesn’t just adversely affect the workers, it hurts organisations too. It can lead to increased absence, higher staff turnover and make it harder to recruit in the first place.

Work-related benefits for gig workers

With many gig workers on low pay and without guaranteed work, it’s easy to see why this sector has attracted criticism. However, pay and conditions are only part of the issue. Where organisations have long focused on reward packages to attract and retain the staff they employ, such benefits have been overlooked when it comes to gig workers.

Without the security of company-funded benefits or high wages to compensate, gig workers are falling between the cracks and have to rely on their own financial back-up if they are unable to work through injury or ill health.

Add into the mix a variable income, low level of job security and a potentially short history of proof of earning, and it’s no surprise that gig workers can find it difficult to protect themselves with products such as income protection, private medical insurance or life insurance.

Benefits for employers

This is bad for the worker and the company. Benefits don’t just provide financial reward, they also build loyalty, engagement, support productivity and facilitate recruitment and retention. The advantages are practical too. Health screening can be included which can help prevent absence in the first place. Products which include services such as physiotherapy to aid rehabilitation can be offered, which can speed recovery and return to work.

Hiring gig workers instead of permanent employees enables organisations to rapidly flex their workforce to meet demand without the overhead of employed staff. But as recruitment in this sector becomes more competitive, not offering benefits will be a serious disadvantage for organisations trying to attract and retain the right candidates.

Options available for employers

One answer is to make self-funded benefits available at discounted rates for workers to opt-in. This can be particularly attractive for SMEs, where budgets can be tighter. Self-funded benefits create a flexible way to offer benefits without companies having to foot the bill.

A huge range of benefits can be offered in this way, including private medical insurance, cash plans, dental insurance, protection products, travel insurance and health screenings.

They can also be especially attractive for gig workers who can use the infrastructure and buying power of a company to access benefits on terms that wouldn’t otherwise be available to them as a private individual, including at a potentially reduced cost. This is a win-win for the company and the worker, as the company also becomes more attractive to work for.

To get real value from offering access to such benefits, it’s critical that their availability is clearly communicated. All too often the advantages of offering benefits is lost when workers don’t know they exist.

As Brett Hill, managing director for The Health Insurance Group, says: “It’s going to be increasingly important for organisations to demonstrate they’re a company of choice if they want to be attractive in our gig economy. There are real and tangible benefits in doing so, and great drawbacks in not doing so. Providing access to wider benefits must be on their agenda. It is possible to make benefits available that meet the needs of this demographic, and it has never been more important for companies to look at their options. They can be a great differentiator when looking to attract talent, and those that make it a priority to promote such benefits are the ones that get most value.”

 

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