Anything you can do to help ease the money spent on travel by employees will be a seen as a real benefit – and a reason to stay with your company.
The advantages of travel benefits
It is important that any benefits you offer are genuinely useful to your employees – and fairly allocated.
Not only that, your organisation has the advantage of providing something which benefits your productivity by allowing people to arrive at your company to do their work – presumably more efficiently.
Here are some of the most common ways you can deploy a travel benefit to your employees:
Obviously, in a large company, not everyone is going to be able to have a company car; however, depending on the nature of their work, employees frequently receive use of a company car as part of their benefits package.
In many cases they will receive use of the company fleet for work purposes as a non-salary benefit, but employers frequently offer to extend this use to non-work purposes in exchange for the sacrificing of a portion of the employee’s salary.
There are a number of reasons why this makes sense from both parties’ points of view. The employer, who will be paying for the fleet anyway, can offset some of the cost against lower salary payments, while the employee gains the tax efficient use of a car, with no initial outlay. For these reasons, a company car is one of the most popular benefits in the transport and travel field.
On your bike!
In these environmentally conscious times, a company car is not always the right answer, especially as it cannot be so evenly allocated across your workforce.
There are other reasons too, for example, the government is also placing and increasing tax burden onto company cars and moving it away from many other transport related benefits. By recently introducing a scheme whereby they will make a contribution of as much as 50% of the cost of a bicycle for an employee.
Both employer and employee then receive 100% tax relief on the benefit.
As public consciousness about the environment has risen, and as the government has begun to seek greener alternatives to car use, this has become a field in which employers can offer cost effective, appealing benefits, while employees can make a saving on their transport costs.
Not only that but using subsidised public transport to get to and from work is a great money-saver. Once again, the use of local public transport (particularly buses) is treated as highly favourably by the tax man.
You can plan your travel benefits to take advantage of discounts with the major transport providers in your area. Clearly it is up to you to decide whether these benefits will be offered in addition to salary or on a salary sacrifice basis.
The basic premise behind any travel subsidies is that people need to get to your office. Perhaps you could re-examine the situation by means of how many people need to come to work at all? Is there scope for home working? Mobile phone strategies can help reduce the need for time consuming reporting and meetings that involve travel.
Planning is vital
Transport and travel is a growing area for employee benefits. In fact, it is one of the most mutually beneficial of benefits schemes – and one of the easiest to communicate and manage.
However, because of this, it still needs to be planned properly. Considerations such as where your company is located and how much it could actually cost if take up is high are just the start. There are other considerations too such as potential changes in tax and subsidies.
Finally, how do you want your company perceived? If you really want to go green and be seen as a go-ahead company, then this must influence all of your travel policies. For example, it would conflict with a decision to offer all employees free car parking.
What is certain is that a well-balanced travel subsidy can benefit both you and your employees if they are properly planned and implemented.