Attracting and retaining top talent is an important factor at the forefront of every employer’s mind. With recent events such as the Great Resignation demonstrating an unprecedented number of employees leaving their jobs, many companies are now attempting to stem this tide by offering stronger benefits to enhance the working experience of their employees.
In a post-pandemic world, more employees than ever are choosing to adjust their lifestyles to prioritise their work-life balance as they recognise the importance of finding greater fulfilment between their professional and personal lives. Factors such as burnout and stress are one of the main contributors toward job dissatisfaction and the decision to find more suitable employment conditions elsewhere.
According to recent statistics, almost three in 10 workers in the UK feel that they are less productive at work due to a poor work-life balance and as many as 88% of employees have experienced burnout in the last two years. Fortunately, it appears that employers are taking notice of this fact as the U.K.’s Chartered Institute of Personnel and Development (CIPD) reveals that increasing numbers of organisations are implementing a range of methods to support employee mental health, making it the most common focus of well-being activity in the workplace.
In efforts to further boost employee well-being, a survey by Mercer has found that as many as 70% of employers are considering adding something known as a ‘Lifestyle Spending Account’ (LSA) to their benefits package. This article will take a closer look at an LSA and the benefits it can offer to employee well-being and retention.
What is an LSA?
An LSA is a type of benefit provided by employers that offer post-tax funds to employees which they can spend on a variety of personal lifestyle activities aimed at supporting their mental, physical, and financial well-being. Examples of eligible benefits offered through an LSA include:
Health and wellness: These benefits extend beyond health coverage and can include things that will also enhance an employee’s overall health and well-being. For example, gym memberships, counselling and therapy, stress management courses, lifestyle and nutrition coaching as well as fitness equipment and health vitamins and supplements.
Childcare costs: These benefits can range from daycare costs and private tuition to babysitters and after-school activities. In some cases, they can also extend to pet care and elder care.
Education and development: This includes materials, courses, and workshops where employees can improve both their personal and professional development. This could be job-specific skills such as IT courses, leadership training or industry certifications as well as opportunities to learn or cultivate hobbies and interests such as cooking, painting, or other activities that contribute to overall well-being and fulfilment.
Home office equipment: With the rise of remote work, employers may provide benefits that enhance employee well-being by providing equipment such as ergonomic furniture to ensure they can work comfortably and efficiently from home.
The Benefits of an LSA
LSAs can positively contribute to both employers and employees in several ways. Some of the key benefits of this offering include:
1. Customisation: Employees can customise their LSAs so they receive the benefits that suit their unique lifestyles and needs, thereby delivering maximum value. Whether it’s personal development expenses, wellness activities, or childcare costs, employees can make use of their allotted funds in ways that are most meaningful to them.
2. Better work-life balance: By supporting employees in areas that make their lives easier and more fulfilling, employers can greatly contribute to their work-life balance, helping to reduce stress, burnout, and workplace absenteeism.
3. Greater job satisfaction: Offering benefits that are designed to support and improve overall employee well-being can lead to enhanced job satisfaction. Employees who have access to resources that benefit their physical and mental well-being are generally happier and healthier, allowing them to be more engaged and productive in their roles within the workplace.
4. Improved employee retention: According to a Gallup poll, millennials and Gen Z want employers who value their well-being. Companies that prioritise this area through benefits like LSAs will be best positioned to remain competitive and contribute to their talent retention.
The inclusion of LSAs in employer benefit packages is a compelling one that not only enhances the well-being of employees but also highlights an organisation’s commitment to creating a healthy and happy workplace.
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