NI hikes expected to be a significant challenge putting pressure on employee benefits

Budget Squeeze: HR’s New Deadly Dance with Rising NICs

What’s the Buzz?

On 6 April 2025, employers across the UK will feel the sting of higher National Insurance contributions (NICs) as the threshold for paying drops. GRiD, the lobby group for the group‑risk sector, has sounded the alarm: a troubling 28% of senior HR decision‑makers think this will throw a wrench into their plans over the next year.

Size‑Based Stress Levels

SMEs: 30% say it’s a serious hurdle.
Large Corporates: 25% feel the pinch.

Budget Blues

In a January 2025 poll, 38% of senior HR leaders confessed that financial constraints are the biggest bottleneck when it comes to boosting employee benefits. Breaking it down:

SMEs: 42% feel the squeeze.
Large Corporates: 30% find it tough.

Why It Matters

GRiD warns that if employers start trimming benefits to make up for the extra NIC cost, staff morale and wellbeing could take a nosedive. Keeping people happy, healthy, and productive is a win‑win for everyone.

Word from the Front

Katharine Moxham, GRiD’s spokesperson, says:

“Employers will be tightening budgets in all departments, but HR won’t be spared. It’s time to prove that your benefits program actually delivers value—otherwise you’ll be tempted to cut back, risking your team’s wellbeing and your company’s bottom line.”

Takeaway

In the face of rising NICs, HR heads should gear up to showcase the real ROI of their benefits. Show numbers, share stories, and remember: a satisfied team is a stable, thriving business.

What do effective employee benefits look like?

Why Group Risk Benefits Are a Game‑Changer for Employee Wellness

Picture this: your company wants to keep every single staff member healthy—physically, mentally, financially, and socially—without breaking the budget. That’s the holy grail, right? Luckily, the answer is simpler than a lottery ticket: group risk benefits like life assurance, income protection, and critical illness coverage.

What the Heck Are Group Risk Benefits?

Think of them as a wellness Swiss Army knife. They slip into every one of the four pillars—financial, physical, mental, and social health—providing:

Preventative guidance (like a pre‑flight check)
Early intervention (if something goes wrong, you’ve got a safety net)
In‑the‑moment help (when life throws curveballs)
Long‑term support (for careers and life beyond the job)

Price‑Tag That Won’t Break Your Bank

In the new era of rising NIC and other costs, you need benefits that give you a leg-up without draining the coffers. Look at the numbers:

Group Life Assurance (GLA) – as low as £15/month per employee.
Group Income Protection (GIP) – around £28/month per employee.

That’s basically pocket‑change compared to the savings in headaches, sick days, and employee burnout. HR teams can breathe a sigh of relief knowing they’re providing solid care without a hefty price tag.

Words from the Wise (Katharine Moxham)

“Group risk benefits are the most highly‑valued perks because they support staff and the business alike. Cutting these benefits would hurt the whole organization. Instead, choose cost‑effective options that give comprehensive care.”

Take that seriously—if you slash employee support, you’re basically setting the whole company up for a health crisis.

Do Your Employees Deserve It?

Employers are going to have to juggle rising costs, so the logical move is to invest in perks that “do a lot with a little.” Group risk benefits fit the bill, turning the plug‑and‑play savings into real, tangible support for people.