Award winner's case study: How Thales unified a workforce

With the objective of creating a unified organisation in a business that had 151 different variations of benefits entitlement, Thales had set a real challenge for itself.

The second-largest UK defence supplier, which employs more than 7,000 individuals in the UK, had the task of staging for auto-enrolment (AE) while at the same time standardising contracts across the entire workforce.

While many employers might have run scared at the prospect of such an endeavour, Thales saw the event as a way to radically overhaul and harmonise the business.

Complexity in employee terms and conditions (T&Cs) and benefits had reached such a stage that Thales was operating 92 variations of overtime rules, 22 payroll runs, 12 variations of holiday entitlement, 28 variations of private medical insurance (PMI) entitlement and 151 different variations of benefits packages.

In order to create ‘One Thales’, the business set out a number of objectives which included standardising T&Cs and culture, improving the perception of remuneration without increasing spend and therefore boosting engagement, as well as creating efficiencies through simplification, automation and streamlining.

To achieve these goals, Thales had three main obstacles to overcome:

• Get 100% of 7,000+ employees across 35 sites to willingly sign up to new T&Cs,
• Stage for AE while also ensuring compliance and effective engagement,
• Roll out a brand new flex offering and improve the understanding and appreciation of the benefits.

Enlisting the help of Thomsons Online Benefits, Thales began an ongoing consultation with its employees and trade unions in early 2012 to ensure buy-in of new T&Cs and the new harmonisation process. Within six weeks, the company had received the buy-in of 90% of all employees, with the remaining 10% signing up in the following four weeks.

By using employee feedback throughout the auto-enrolment process and keeping individuals engaged and informed, 800 employees of the 2,000 employees who were not in a pension scheme at the start of the project opted to join the company’s defined contribution scheme prior to the official AE staging date.

But the company did not stop there. A total reward statement was launched, its flex offering, ‘Simply Flexible’, was introduced for all employees, and technology was fully embraced where possible through the use of modelling in pensions. This meant employees were able to understand their potential retirement income according to different contribution rates.

Working on the basis that its new reward programme was supported by HR but not a HR-led programme, Thales managed to win the hearts and minds of employees by listening to what its workforce wanted throughout the process.

This was made clear in the company’s take-up figures, with a total of 5,515 employees signing up for flexible benefits and 82% of the workforce logging on to the Simply Flexible portal. Permanent health insurance (income protection) proved to be the most popular benefit, with almost all employees signing up (98%).

These high scores were also visible in employees’ engagement feedback. A recent employee survey revealed there was a 52.4% increase in employees who flexed their benefits and agreed with the statement, “Simply Flexible recognises me and values me as a person with individual needs”.

Thales’ objective to improve perceived remuneration was also a success. Employees who had signed up to the flexible benefits package estimated that it was worth an average of 11.6% of their basic salary, versus 9.7% for those who had not logged in.

Thales estimates it has saved a staggering £5m through the changes that have been implemented, proving that – with a considered approach and by ensuring buy-in from all concerned members – everyone can benefit from the end result.