It can often be difficult for new businesses to attract the best talent. The traditional means of attracting the best employees has been to offer more money than the competition. However, a start-up does not necessarily have the cash to offer high salaries and compete with the more established businesses.
To compete for the best talent, a new business must be more creative with how they attract and incentivise prospective employees. Alternative options for new businesses are to offer share options, a commission scheme or a cash bonus scheme that rewards the employee depending on particular events (for example, making a particular number of sales, achieving a certain profit level or the sale of the business). These rewards do not require cash to be immediately available and can encourage greater “buy in” from the employee. Employees will see that their performance will be rewarded, whereas there can be a perception that salary is paid simply for turning up.
We have also seen an increasing trend of prospective employees shunning greater financial reward in favour of non-financial benefits. Some employees favour a greater work life balance instead of a bumper salary and are willing to accept a lower salary in the knowledge they get to leave the office. We have seen employers attract employees with showing a commitment to a work life balance, offering flexible working and the ability to work from home. Even the concept of “unlimited holiday” is becoming increasingly popular.
Start-ups are in a great position to establish a balanced working culture from their inception and this should not be underestimated in its ability to attract the brightest and best talent.
Whichever route your business pursues, we are here to advise and put in place the appropriate documentation.