Why introduce a share plan for your employees – do they really value the benefit?

TODAY, over 2 million employees take part in a variety of share plans from Executive Share Plans, to All Employee Plans such as the Share Incentive Plan (SIP) and Sharesave.

Employee share plans can be a mutually beneficial option to employers and employees alike. They offer excellent value in helping engage employees and rewarding them for their contribution to business performance.

In an increasingly competitive world, organisations need to get the best out of their teams. A strong remuneration and people strategy is key to success, and share plans can play a vital role in both.

With almost 1.5 million participants, Sharesave still has a good slice of the action – understandably so when you consider it has been around for over 35 years. But do we really understand what Sharesave means to employees?

ifs ProShare, the voice of employee ownership, produce an annual report using data from principal share plan administrators. The recently published 2016 ifs ProShare statistics (based on 2015 data) show that:

– 420 companies of the 489 surveyed continue to regularly offer Sharesave to their employees
– The most popular savings term is 3 years
– 80% of these companies offer the maximum discount of 20% on the share price
– The average monthly saving is £119.78 per month

Whilst the above highlights some of the trends from the annual survey results, it tells us very little about the behaviours of share plan participants and what they do with their savings.

Louise Drake, national sales manager, Growth & Acquisition at YBS Share Plans, said that pension changes and share ownership are current hot topics, with Help to Save and Life Time ISA also bringing personal savings into sharp focus.

“We’re passionate about understanding what really engages our customers and this increased understanding will help us better position the range of employee benefits on offer, support the financial education agenda and benefit the sector as a whole.”

YBS Share Plans (“YBSSP”), part of Yorkshire Building Society, recently commissioned research for the second time in five years with leading academics Professor Andrew Pendleton, of Durham University Business School, and Professor Andrew Robinson, of Leeds University Business School. The research is supported by YBSSP’S own Customer Insight Surveys.

Key findings from the Research:

• Participant savings contributions to Sharesave continue to rise
• Sharesave is still attractive to those on lower income with 25% of participants saving £60 per month or less
• For many, Sharesave provides a savings lifeline with 35% of participants only saving regularly into their Sharesave account. For many the alternative to Sharesave contributions is expenditure with 65% of those saving only into Sharesave saying they would spend the money rather than invest elsewhere if Sharesave didn’t exist
• 46% of all participants continue to hold shares in their employer of which 25% can be viewed as long term shareholders (5 years or more)
“With over 45% Sharesave market share, YBSSP have a meaningful sample size from which to draw our analysis. This insight enables us to continually feedback to our corporate clients to ensure that plan designs and overall remuneration strategies are aligned with the wishes of their employees,” added Louise.

For more information please contact:
Louise Drake
National Sales Manager – Growth & Acquisition
Mobile: 07810 636 276
Email: lndrake@ybs.co.uk

Ifs ProShare Annual Report: survey results published 1 June 2016, based on 2015 data.
Research data, source: Data obtained from a survey of Sharesave participants whose accounts are administered by YBS Share Plans, part of Yorkshire Building Society. Those holding a Sharesave account with YBS Share Plans were invited to participate in the survey between October and December 2015 by following a web-link provided in their annual statements to an on-line survey. 3,301 Sharesave participants entered the survey, with around 2,790 completing it with more or less full data.
YBS Share Plans is part of Yorkshire Building Society.
YBS Share Plans, Yorkshire House, Yorkshire Drive, Bradford, BD5 8LJ

Yorkshire Building Society provides Share plan trustee and administration services, including deposit taking, in England and subject to English law and regulation. We are not responsible for Share plan deposits held by local savings carriers outside the UK.

Yorkshire Building Society is a member of the Building Societies Association and is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Yorkshire Building Society is entered in the Financial Services Register and its registration number is 106085. Head Office: Yorkshire House, Yorkshire Drive, Bradford, BD5 8LJ.
All communication with us may be monitored/recorded to improve the quality of our service and for your protection and security.