Small and medium sized enterprises (SME) are concerned their employees face a protection gap compared to those at larger firms, an insurer’s survey has found.
Insurance company MetLife reported 63 per cent of SME senior managers worried their staff suffered from a benefits protection gap, missing out on benefits offered by larger firms.
In a survey of 508 senior figures at SMEs employing between 50 and 299 staff, executives at firms on the larger end of the SME scale were found to be most concerned about their employees’ benefits - with 71 per cent admitting it posed a worry.
Comparatively, employees in smaller SMEs were more likely to receive greater benefits - with 39 per cent of the smaller firms surveyed offering pension contributions above the statutory minimum.
MetLife found a widespread recognition of the value of employee protection, with 69 per cent of SME managers agreeing they had a duty to provide benefits beyond pensions.
Of the 508 managers surveyed, one in 10 reported they were unable to provide benefits beyond workplace pensions - with a lack of budget cited as the biggest reason for this.
Adrian Matthews, employee benefits director at MetLife UK, said: "SMEs are very much focused on retaining and recruiting staff and recognise the significant role that benefits in addition to salaries can play. It is interesting they believe they have a duty to offer staff more.
"The issue of the protection gap between SME staff and employees at larger corporates is however a concern for substantial numbers of senior managers who see the life insurance and income protection that major employers offer and wonder how they can compete.
"Budget is clearly a perceived issue for SMEs but in reality the costs are much more affordable than they think - group life can cost as little as 0.3 per cent of payroll and group income protection 0.5 per cent."
rachel.addison@ft.com
