Do you want to increase the salary of your employees, without increasing the salary cost? We talk about Flexible Remuneration Plans.

Flexible pay, also known as flexible remuneration, is a concept that allows companies to offer their employees various options to customise their pay package according to their individual needs and preferences. Instead of receiving a fixed, uniform salary, employees can choose how to spread a portion of their total remuneration across different benefits and services. 

This formula allows employees to spend up to 30% of their gross annual salary on day-to-day services (daily menu in restaurants, childcare, transport…) exempt from income tax. In this way, they obtain significant savings while increasing their net disposable salary without incurring additional salary costs.

The salary in kind is not part of the basic salary on the pay slip, but it must be included in the pay slip, is taxable for personal income tax purposes and is subject to social security contributions. In addition, the economic value of this remuneration will also be used in the calculation of severance pay.

The main objective of flexible pay is to give employees more control over their compensation and allow them to tailor it to their personal circumstances. This may include aspects such as a choice between pension plans, health insurance, meal vouchers, transport vouchers, childcare benefit plans or career development programmes, among others.

Some of the benefits of flexible pay for companies and their employees are:

-Attracting and retaining talent: Offering personalised compensation options can be attractive to employees and can help the company attract and retain talent.

-Improving employee satisfaction and motivation

-Flexibility in labour costs: Flexible remuneration allows companies to manage their labour costs more efficiently, as they can tailor the benefits offered according to the needs and budget of each employee.

-Taxation and savings: Some benefits offered through flexible remuneration may have tax advantages for both the company and the employees.

-Work-life balance: the products and services you can access with flexible remuneration (childcare, food, transport, health, etc.) improve employees’ daily lives.

-It favours employee savings: employees purchase products and services at a lower price than usual.

-Increased productivity and reduced absenteeism.

-It enhances the company’s brand image and reinforces the corporate culture.

Flexible remuneration thus becomes a way to pay employees better, beyond the simple payroll, and responds to the need for companies to offer an emotional salary that also takes into account issues such as well-being and work-life balance.

Services such as meal vouchers and cards, childcare vouchers or transport cards, among others, can make life much easier for employees and are a sign of the company’s commitment to them.

If you are considering incorporating Flexible Remuneration in your company, it is important to know the interests and preferences of your employees, determine which services are most in demand and define a timetable for launch and implementation.

Other relevant issues for the successful launch of a flexible remuneration programme is to design a good communication plan that not only informs about the advantages of the programme but also reinforces the employee’s confidence. Likewise, it is also important to be well advised by an expert broker who, in addition to the design, implementation and management of the programme, can advise you on everything related to the limits and tax exemptions provided by law and help you to find and implement the best and most innovative technological solution and the one that best suits your expectations and needs.

At Benefit Brokers we are specialists in the design of Flexible Remuneration Plans and corporate Health Programmes with solutions and services in the field of physical, mental and financial wellbeing that impact and contribute to improving people’s health, helping to build healthier organisations. Because good work is only possible when there is good health.

Federico Vizcayno de Barutell

Socio – Director