This is a study of what drives employee benefits that I did in Q1 2013. The study was conducted via a survey methodology using LinkedIn to reach Australian HR managers.

1. What drives employee benefits
strategy in Australian
organisations?
- Study through survey of Australian HR managers

2. Executive Summary
1
100% of HR managers surveyed say that employee benefits
drive retention
Leave and flexibility are considered the most important type of
employee benefit followed by financial benefits such as salary
packaging
Cost to the organisation is a key factor in deciding which
employee benefit to provide to their workforce
Understanding of salary packaging and novated leasing is
high among the HR managers surveyed
73% of organisations surveyed already have salary
packaging or novated leasing in place
2
3
4
5
6
78% of organisations that do not already have salary
packaging or novated leasing are considering to implement
in 2013!

3. DRIVERS OF EMPLOYEE BENEFITS
We asked what the main drivers of an employee
benefits strategy were:
of HR managers surveyed either
agree or strongly agree that
employee benefits drive
retention

4. What do you see are the main drivers of an
employee benefits program?
5%
5%
59%
36%
63%
35%
64%
32%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Attracting new staff
Retaining existing staff
Engaging Staff
Disagree Agree Strongly Agree

5. Types of Employee benefits ranked in order of
importance to HR managers surveyed
1
Leave and
flexibility
benefits
2
Financial
benefits such as
salary packaging
3
Wellness
programs such
as gym
memberships 4
Access to
consumer
retail
discounts 5
Leisure and
lifestyle
memberships

6. Cost to the organisation is a top consideration
while deciding what benefits to give employees
1
Cost to the organisation
2
Potential participation of employees
3
Ease of implementation
4
Savings offered to employees
5
Compliance and risk

7. Awareness and understanding of salary packaging and novated
leasing is high among HR managers across Australia
7
I don't know
anything about
salary packaging or
novated leasing
5%
Somewhat
understand the
benefits
38%
I understand salary
packaging and
novated leasing very
well
57%

8. 73% of HR managers surveyed have salary packaging or
novated leasing as an employee benefit in their organisation
already
8
0% 10% 20% 30% 40% 50% 60% 70% 80%
No
Yes
Does salary packaging or novated leasing form part of your
organisation's employee benefits program?

9. 78% of HR managers who do not offer salary packaging or
novated leasing are considering offering it in 2013
9
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
No
Yes
Would you consider exploring the option of including salary
packaging and novated leasing as part of your organisation’s
employee benefits program in 2013?

10. Only 19%of organisations that do salary package do it internally
completely
10
Outsourced
44%
Internally
19%
Combination
37%
Do you outsource or do the benefits administration internally?
In the combination category, most do salary packaging internal and novated leasing outsourced

11. The main advantages of why organisations want to
salary package – particularly cars
Top advantages of providing salary packaging and novated leasing
Tax benefits and therefore more competitive salaries
Meets employee expectations and is consistent with competitor offering
Employees expect it nowadays
Cost neutral to the company. Employees get to purchase a vehicle they would not normally be
able to afford.
Provides freedom of choice and flexibility for employees and reduced vehicle costs to employers
More to offer to employees, leads to greater tie-in or retention
Tax benefits; ability to spread cost

12. Top challenges to providing salary packaging: HR
managers believe there’s not enough benefit for employees
18%
39%
43%
50%
68%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Employees aren't
interested
It is expensive to
implement and
administer
It is difficult to
understand how
salary
packaging/novated
leasing works
The process is
complex to
implement and
administer
There's not enough
benefit for
employees
One of the respondents’ comments was - “Planning, thought and variety overcome these challenges”.

13. 71% of HR managers would consider a service that guarantees the
lowest price for new cars as an employee benefit outside of salary
sacrifice
29%
71%
0% 10% 20% 30% 40% 50% 60% 70% 80%
No
Yes
Car buying service

14. Prashant Mohan
Marketing Manager
prashant.mohan@smartsalary.com.au
D +612 9119 8338
Smartsalary is sponsoring and speaking at the upcoming
IQPC Remuneration and Reward Summit to be held in
Sydney on 25 – 26 June 2013.
Visit www.remunerationandreward.com.au for more
information about the event or to register.
For more information: