The Race Is On To Pay Employees Less

PRLog (Press Release) - Feb. 21, 2011 - In the UK and many other countries with budget deficits, income tax is rising and the point at which employees pay higher rates is getting lower.  This has led to a flood of requests to be paid less and to receive alternative benefits.  A recent survey by UK Management consultants Protostar Leadership Development Ltd (www.protostar-uk.com) showed that 70% of responders had received within the last 6 months, a request for either flexible working arrangements or flexible benefits.  85% were expecting to be asked to try and keep employees below the new lower threshold for high rate tax.

More worryingly, 65% of companies who responded stated that they did not currently have a process in place for offering flexible benefits and most could only support a tiny number of flexible workers.  The most common concerns raised were, opening the flood gate to more requests, managers wanting employees at their desks full time and not knowing how to administer a flexible range of benefits and stay on the right side of the tax man.

In response to these results, Protostar are running a series of seminars along with UK law firm Ward Hadaway, with the aim of educating employers on both the business case for offering flexible working and benefits, plus the practicalities.  

Managing Director of Protostar, Michael Coates, said "I think many employers have been nervous of publicising that European employees have a legal right to ask for flexible working arrangements and are simply confused by the idea of moving away from a standard salary to a range of flexible payments."  

In light of new tax thresholds in the UK, a common request is to have more holidays and less salary.  Assuming that the employer can cope with employees having more time off then this is a cost and tax efficient win win situation.  

Michael Coates is convinced that such flexibility will soon be the norm.  "I suspect that the days of simply offering someone an hourly rate or an annual salary are soon to be over.  It will be standard practice to offer a flexible combination of salary, holiday, car, medical, training and other benefits and employees will be increasingly savvy at selecting the package that best fits their tax situation."

Protostar are also encouraging employers to sign up to the "Workwise Campaign" spearheaded by employers such as British Telecom.  The workwise scheme promotes smarter and more flexible working arrangements, which have to date saved many organisations considerable sums of money and helped them to avoid redundancies.  http://protostar-uk.com/WorkWise.aspx

"If more organisations took the lead that Workwise participants have taken, then they would see costs reduce and employee satisfaction increase.  I suspect that once again, it is simply lack of knowledge and some nervousness that is holding employers back and that is such a shame" said Protosstar MD Michael Coates.

For details of seminars on flexible working and benefits go to  http://protostar-uk.com/Flexibleworking.aspx

# # #

Protostar Leadership Development Ltd are a UK and USA based management consultancy who specialise in developing leaders through executive coaching, training and support druing challenging times.