“Long Service Awards” provide special recognition of an employee’s length of service at a company. The award goes beyond just a raise in pay and provides your long-serving employees with both merit and value. The recognition employees receive should increase the longer they are with your company; for example, in their first year, they may just receive a letter of thanks and a small gift such as a Will, while after 25 years or more, this may become an approved sabbatical or larger gesture (The Balance Careers).
Why offer a Will?
A 2017 study showed that over 60% of the adult UK population does not have a Will in place; without a valid Will, the majority of adults risk leaving family and loved ones with a financial and emotional burden (Unbiased).
A Will can be one of the most vital documents your employees will ever sign, providing them and their loved ones security and peace of mind in the following areas:
- Ensuring families and loved ones are protected.
- Allowing appointment of guardians for any child under the age of 18
- Providing for unmarried partners, who receive nothing unless stated in a Will
- Making sure those whom the Will maker wants to get full ownership of assets, receive these. (By law the balance of an estate is divided, should the unfortunate occur, between a spouse and children after the first £250k.)
- Protecting assets by placing them into trusts.
Other Popular Long Service Employee Benefits to Consider Alongside a Will:
- Cash or vouchers
- A bonus payment
- An approved sabbatical
- An event or gift day
- A gadget
- A subscription service
It’s also a good idea to consider how long the employee has been with you, and the individual employee when deciding on Long Service Awards. These benefits need to show that you appreciate the employee and should, therefore, be thoughtful and meaningful.
HMRC Financial Advice:
HM Revenue and Customs’ advice is that you do not have to report or pay tax on a non-cash long-service award to an employee if:
- they have worked for you for at least 20 years;
- the award is worth less than £50 per year of service, and
- You have not given them a long-service award in the past 10 years.
You need to be aware that if you are offering readily convertible assets, which can be exchanged for money, these may have to be disclosed as part of an employee's pay.
Meaningful Long Service Awards and Employee Retention
Implementing meaningful Long Service Awards to employees is likely to improve your employee retention, and help to create a feeling of value to your employees. If you are considering offering a Will as part of your Long Term Service Awards, call a member of our Corporate Benefits team on 0808 281 1545.