6th April 2022 2 MIN READ •Talos Engage •Employee Value Proposition
Key takeaways
- Tangible employee benefits are workplace benefits that people receive directly, and are typically outlined in their contract
- Intangible workplace benefits tend to be more abstract and culture-based, and may be awarded on an ad hoc basis
- Examples of tangible workplace benefits include bonus schemes, healthcare plans, or a company car allowance
- Examples of intangible employee benefits include initiatives to enhance people’s work-life balance and the wider office environment, such as flexible working or team socials
- Both tangible and intangible workplace benefits are important; the former because they act as a form of compensation for employees’ service; the latter because they support your company’s employer brand, overall culture, and EVP
What are ‘tangible’ employee benefits?
Tangible employee benefits are received by employees directly. This may include bonus schemes, healthcare plans, or a company car allowance.
These are often written into employment contracts, and tend to vary between position, department, or seniority. Tangible benefits are often advertised in recruitment adverting campaigns but are discussed in the later stages of the recruitment process.
Any changes to your tangible benefits package will have a direct impact on your employees. They can be used to recognise good performance, acknowledge length of service, or promote retention within your workforce.
What are ‘intangible’ employee benefits?
Intangible benefits are more abstract, and tend to affect your workforce on a wider basis. This may include things like your office environment, flexible working initiatives, work-life balance, and staff social events.
Unlike tangible benefits, these incentives are rarely contractual, and may even be given on a one-off basis. For example, you may hold a company-wide celebration after a period of strong performance. Any intangible benefits should be presented during the onboarding process – so make sure top add it to your onboarding checklist.
Intangible benefits are the building blocks of your workplace culture – the day-to-day environment in which employees carry out their work. These are a powerful asset to your employer brand, helping you to communicate your cultural values within the job market.
Tangible vs Intangible benefits: which are better?
Most employers show little distinction between tangible and intangible benefits – instead, combining both into their employee incentives package. However, there is a huge difference between the two, and how they affect employee satisfaction and retention.
Here’s why the strategic contrast between ‘tangible vs intangible’ is so important:
– Why tangible benefits matter
Tangible benefits work a lot like salary; they’re a form of compensation for employees’ time and dedication to your business. They’re your second most important ‘bargaining chip’ in retaining and inspiring your colleagues.
Tangible benefits tend to change for individual employees, and can be used to recognise a promotion or length of service. For example, employees at management level may become eligible for a company car allowance. This, along with an increase in salary, serves as an additional level of compensation for their heightened responsibilities.
– Why intangible benefits matter
Intangible benefits are what define your employer brand and workplace culture. These can be used as a unique selling point (USP) for your business when seeking to attract new talent.
While they may not be seen as a direct form of compensation, intangible benefits are just as important for maintaining employee morale and wellbeing. They serve as a valuable form of workforce recognition, without being limited to individual employees/departments.
Your intangible benefits are what set you apart from other employers in the job market. They’re vital for attracting the most sought-after candidates to join your business. Without a strong foundation of cultural incentives, you’ll find it difficult to compete for talent in your industry.
Tangible vs Intangible: What matters to your workforce?
Tim Clifford, Talent Insights Specialist at Talos360, explains: “By using Talos Engage, you’ll identify which benefits matter most and least to your employees. This will help you balance tangible vs intangible incentives, and build a benefits package that truly resonates and drives engagement.”
