REWARD
Q: What are cycle to work schemes and how do they work? Cycle to work schemes are a benefit employers can offer their employees in the form of a salary sacrifice scheme. For clarity here, a salary sacrifice arrangement is an agreement to reduce an employee’s entitlement to cash pay, usually in return for a non-cash benefit. The salary sacrifice reduces the employee’s gross pay, which means they pay less income tax and National Insurance (NI). An appropriate bike can often cost an individual a few hundred pounds – something that simply isn’t feasible for many, especially during the current climate. By participating in a cycle to work scheme, employees can avoid the upfront payment, spreading the cost across several months and purchasing products interest- free with no impact on their credit. By saving on tax and NI, they can save 25% - 30% on a bike or accessories. Cycle to work schemes are a benefit employers can offer their employees in the form of a salary sacrifice scheme Q: Do you find that ‘cycle to work day’ sparks interest in the cycle to work scheme? The idea behind ‘cycle to work day’ is to allocate a day to focus on giving people a nudge to give cycling to work a go and to see how easy it can be. Whether you’re: l someone that cycles already and wants to encourage your colleagues l someone with a commute that feels too long to cycle, or l someone who doesn’t think they can afford it. ‘Cycle to work day’ is there to celebrate and encourage employees to get involved, no matter their situation. This year, the day was more important than ever, with the cost-of-living crisis prompting workers to consider an alternative method of commuting, to save on their daily expenses. In fact, cycling to
start when supporting individuals in the workplace. Reducing the cost employees must pay to get to work can only be a positive thing and employers can easily do this by offering a cycle to work scheme. In addition, with one in five employees claiming that access to a bike is the biggest barrier, cycle to work schemes enable employers to break this down and offer employees a cost-effective solution by spreading the cost across several months. During the pandemic, we saw a huge rise in people looking to cycle as a method of keeping fit, in place of their gym memberships, as their gyms were closed. We predict a similar shift in this climate, with people cancelling their memberships in search of a cheaper way to keep fit, who want to build exercise into their daily routine. As such, we expect an increase in, not only employers offering a cycle to work scheme, but also an uptick from employees in efforts to cut their costs. Q: What benefits do cycle to work schemes provide for the employer? In the current economic climate, many, if not all, employers are looking at ways they can support their employees. However, offering salary increases or one-off cash bonuses for most employers is not a financially viable option and so, it’s here, that offering the right employee benefits, such as a cycle to work scheme can prove to be invaluable. Cycle to work schemes such as Cyclescheme are great employee benefits. Not only are there financial benefits for employees, but cycle to work schemes are a well-recognised benefit that prospective candidates genuinely look for on a job specification. As such, if employers can demonstrate that it’s something they provide, they’re likely to attract a higher volume of candidates. There’s also the added benefit of having healthier and happier employees, as well as a more positive attitude. Introducing a cycle scheme for your workers means a more productive and engaged workforce. There’s financial benefit to the employer as well as their employees, as they save on employer’s NI too. n
work can save commuters on average up to £740 a year. 58% of people who signed up for Cyclescheme this year did so due to word- of-mouth from friends and family, who recommended the scheme to them. This is clear evidence that individuals who try or hear about the scheme are often likely to want to incorporate it into their daily routine. Q: Do you think the pandemic has helped the cycling industry? There’s no doubt that during the pandemic, cycling grew in popularity, whether people were just looking for their one hour of daily exercise or used the time to fall in love with cycling again. Another major factor was that roads were far quieter, giving people the confidence to cycle again. When we speak with our customers, one of the main concerns employees have about cycling in larger cities is road safety. Unfortunately, a lot of the cycling infrastructure in place was / is temporary and doesn’t meet the same parameters of permanent infrastructure. This means cyclists can’t feel as confident in their commute and will often avoid it all together. The recent increase in cycle routes in London is a step in the right direction to encourage people to take up cycling. In addition, employers have a key role to play in ensuring the right infrastructure is in place at the office for employees cycling to work. For example, having safe bike parks and areas to securely store equipment. This will give employees the encouragement to cycle to work with the assurance their bikes will be safe. Q: Have you seen an increase in Cyclescheme sign-ups due to the cost-of-living crisis and the great resignation, as employers are looking to support and keep employees happy? We’re continuing to see an increase in the number of sign-ups in our cycle to work scheme as employers look to support their employees during the current economic climate. The commute is a common thread between employees in an organisation. With many people making trips to the office at some point during the week, offering a means of reducing the commuting cost is a great place to
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| Professional in Payroll, Pensions and Reward |
Issue 85 | November 2022
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