How Can Employers Attract and Retain Diverse Talent?
Companies are facing an increasing battle to attract and retain diverse talent. There are numerous advantages for having a diverse, representative talent pool. A talent pool with diverse backgrounds bring a variety of skills and experiences from which your organisation could benefit. Diversity encourages innovation when different perspectives are brought to the table. Having a diverse team opens your company to interacting with a broader client-base. Most importantly, when your company embraces diversity it will attract a wider range of candidates, increasing the talent available to choose from for your company.
This brings us back to our initial dilemma; how can companies attract and retain diverse talent? In a survey conducted by the Society for Human Resource Management it was found that one of the benefits that employees found most important was that of retirement savings and planning benefits.
How then can you as the employer enhance retirement savings and planning benefits for your prospective and current employees? Over and above the pension and provident fund contributions you could enhance retirement savings and planning through the use of tax-free saving accounts (TFSA) and retirement annuities (RA) to supplement your employees’ retirement savings.
TFSA’s were made available in March of 2015. Your employee would not have to pay income tax, dividends tax or capital gains tax on the returns from these investments. They are allowed to contribute a maximum of R33 000 per tax year (annual limit) with a lifetime limit of R500 000. When returns on investment are added to the capital contributed, the balance may exceed both the annual and/or lifetime limit. The capitalisation of these returns within the account does not affect the annual or lifetime limit.
RA’s are a tax efficient retirement savings mechanism which provides for tax deductible contributions up to 27.5% of income (max R350K, combined retirement planning). It attracts no income, dividend or CGT tax during the life of the RA. There are constrains to RA’s that promote funds availability during retirement years. These include:
Barring one-time lifetime withdrawal there is no access to funds before age 55
Must annuitise 2/3 at retirement or all if less than R247,500
Combining these two benefits into your current offering will provide your company with a retirement savings solution that will assist your current talent save for retirement and indicate to prospective talent that you value your employees.
As Sarah Kayongo, country manager of DHL Malawi noted:
“A good benefit package gives employees a sense that the company cares and appreciates their hard work,”.