Employee engagement: a simple guide

As we say above, this is a guide only and should not be taken as advice. For financial advice about the suitability of any product for your business, please speak to your financial advisor.

We spend around 50 years of our lives at work, which, let's face it, is a long time if we're unhappy in our jobs! We want to work for an employer where we feel fulfilled, respected, wanted and happy.


So, what happens if your staff are unhappy and uninterested? And what can you do to put a smile back on their faces and a spring in the company's step?

What is employee engagement?

The Chartered Institute of Personnel and Development (CIPD) references employee engagement as having three key physical and psychological states:

  • Vigour – energy, resilience and effort
  • Dedication – enthusiasm, inspiration and pride 
  • Absorption – concentration and being engrossed in work

that can be measured and acted upon1.

In a nutshell, it all boils down to ensuring your staff are happy and feel valued at work.

The ORC’s most recent global study in 2016 – What makes a winning workplace? – revealed a little over half (58%) of the UK’s employees felt engaged at work2 – narrowly beating known notorious workhorse countries, Japan and Hong Kong.

The survey also revealed that a fifth of UK employees would not recommend their organisation as a place to work or feel it motivates them to contribute more than normally required.

The take away is that a number of employees aren’t inclined to do any more than the bare minimum needed to do their day-to-day duties. But is this something companies really need to worry about? After all, aren't there plenty of people out there desperate for a job if you lose a disgruntled employee? Well, putting aside the fact that replacing an employee can cost considerable time and money, unhappy and disengaged employees may be less effective at their job, less motivated, less invested in the company and so potentially more inclined to go off sick instead of soldiering on.

The result can be a greater cost to the business, extra pressure on colleagues and a lowering of morale. And all this ends up on your bottom line.

Causes of staff disengagement

So, why are some staff disconnecting with their work and workplace?


Again, according to the ORC's survey, employees in less senior positions are uninspired, unhappy with the opportunities to share ideas or opinions, or even feel their opinion counts.

Putting some overall figures on it, only 49% of non-managers were happy they could share ideas or opinions, 48% felt their opinion was valued, while just 38% were excited or inspired by their company’s communications. Tellingly, this last stat only rose to a little over half (52%) even among line managers.

It's also possible to inadvertently disengage employees when you're trying to do the polar opposite, so make sure you think through your employee engagement ideas before rolling them out!

Building an employee engagement strategy

The thought of creating an employee engagement strategy can seem overwhelming. Where do you start?


A good place can be looking at wider engagement trends and also, importantly, looking at drivers for staff within your company.

The ORC’s findings suggest that the biggest drivers of engagement in the UK are feeling valued and a confidence in the leadership/management team, along with having a voice in the organisation. But, says the CIPD, workload, management style and relationships at work are among the biggest causes of workplace stress3.

Acas4 lists the four key ingredients to a happier, more motivated and more productive workforce as:

  1. Leaders with a vision who value how individuals contribute
  2. Line managers who empower rather than control their staff
  3. Values that are lived and not just spoken, leading to a sense of trust and integrity
  4. Employees who have the chance to voice their views and concerns

To get the best out of their staff, employers need to encourage an atmosphere that genuinely wants to take into account, and act on, employees' suggestions or comments. So let's take a look at some of the possible areas to consider when creating an employee engagement strategy:

People management

To tackle the apparent breakdown of some staff/management relationships, training newly-appointed managers in people management techniques can be one way to equip someone stepping into the role. Key management behaviours to consider include:

  • Being responsible and showing respect
  • Managing and communicating workloads
  • Treating people like individuals within the team
  • Offering support with managing difficult situations

Acas’ Guidance: managing people has a number of practical suggestions.

One example of setting up good communication is the introduction of staff surveys. This gives workers the opportunity to anonymously voice concerns about their jobs and submit their suggestions for possible improvements the company could make to the benefit of the company, its staff and its customers, all while increasing engagement.

Remember, a business is only as good as its people. Happy staff = a more profitable and successful business.


The CIPD’s 2020 Health and Wellbeing report suggests there’s still work to do in embedding wellbeing. Less than half (44%) agreed there was a standalone wellbeing strategy in place supporting their overall strategy, while 41% admitted they were reactive rather than proactive. However, more positively, 61% said wellbeing is on senior leaders’ agendas while 66% say employees are keen to engage with health and wellbeing initiatives.

And the healthier staff are, the higher their engagement levels are likely to be.

Business benefits

As well as putting in place practical and inclusive ways of working, companies can demonstrate that they value their staff by offering business benefits.

Having the right mix of health and wellbeing employee benefits and perks can have a massive effect on employee engagement, which could lead to greater staff retention and recruitment.

Engaging your employees doesn't have to cost a fortune. Mixing up softer benefits and perks that appeal to the ‘here and now' with protection-based employee benefits that are designed to look after employees in the longer-term can be a good combination.

And remember to make sure staff know what benefits are available and what they offer. Ridiculous as it may sound, despite the time and money spent in providing the right mix of employee benefits, some companies consider it ‘job done' and don't bother to tell their staff about what's available.

The CIPD’s 2018 Reward management report found that almost 1 in 6 HR personnel didn’t bother to tell their staff what benefits were available5 – presenting an easy win for those that do, and helping to build employee engagement and a more loyal workforce.

Perks and benefits to consider


Here's an overview of some of the top Group Risk, and health and wellbeing benefits according to research by Employee Benefits magazine6.

Remember that there may be tax and National Insurance implications for both your business and your employees, so you should always talk to a professional tax adviser. And for insurance products, scheme levels, and terms and conditions apply.


Life Insurance/Death in Service

Life insurance provides peace of mind and a tax-free lump sum to an employee's loved ones should an employee die, helping relieve money worries at a very difficult time. The sum paid is based on a multiple of the employee's salary


A pension is designed to fund a person’s retirement. Following auto enrolment, all companies now have to offer their employees the opportunity to join a pension scheme. The majority of these are now what’s called a Defined Contribution scheme, also called a Group Personal Pensions (GPP) – where the money is invested by a pension provider chosen by you. These have now largely replaced the more traditional Defined Benefit scheme – where the amount someone is paid in retirement is based upon how many years the person has worked for you and the salary they’ve earned during that time.

Income Protection including Sick Pay Insurance

Both Income Protection and Sick Pay Insurance can provide a percentage of income if an employee is unable to work due to illness or injury, so you don't have to. The difference is that:

  • Income Protection covers long-term absence - typically, it starts to pay out after your employee's been off work for 6 months (called a deferred period, or waiting period) though this time can vary depending on the policy chosen. It usually continues to pay them until either they return to work, or for 2, 3 or 5 years, or until they reach retirement age.
  • A product like Sick Pay Insurance covers short-term absence. Depending on your provider, it can start to pay out after your employee's been off work for just one week and continues to pay them for up to a year.

However, neither policy covers your staff against redundancy.

Personal Accident Insurance (PAI)

Not to be confused with Income Protection, PAI can pay out a one-off, tax-free lump sum if an employee dies or suffers a permanent total disability following an accident or unforeseen event. It doesn’t cover sickness or general disability.

Medical or Health Cash Plan

A medical/health cash plan essentially covers smaller health issues. Depending on the condition claimed, it can either reimburse or pay towards healthcare such as minor dental work, check-ups, eye tests and physiotherapy..

Private Medical Insurance (PMI)

PMI is designed to meet either part or all of the cost of private medical treatment. It typically covers acute illness or injury, but usually excludes any pre-existing conditions.

Critical Illness Insurance

Critical Illness Insurance can pay a tax-free lump sum directly to an employee if they suffer any of a list of defined medical conditions or surgical procedures - classified as critical illnesses - and survive for a set amount of days afterwards - typically around 14 days.

Counselling or Employee Assistance Programmes (EAP)

An EAP offers a range of support tools to employees on a wide range of work/life issues, including counselling. Importantly, they typically include employer support too.


Depending on the plan chosen, dental cover can reimburse 100% of NHS charges and contribute towards private dental treatment up to a set annual and treatment limit for a range of procedures.


Employers pay for regular eye tests and either for, or towards, the cost of glasses if required.

'Soft' benefits

As well as the core wellbeing benefits that help protect employees' health, ‘softer' benefits provide a well-rounded and comprehensive package, and score highly on the staff benefit-o-meter!

These may include:

  • flexible working
  • season ticket loans
  • extra holidays (either to reward long service or an option to ‘buy or sell' existing holiday entitlement)
  • childcare vouchers
  • retail vouchers
  • gym membership
  • on-site car parking
  • cycle to work scheme
  • dress down
  • dining cards
  • free or subsidised tea/coffee/lunch

Costs will, of course, vary, but the goodwill generated is priceless.

Top 10 takeaways

Here's a round up of the key points to consider when it comes to employee engagement:


1. Engagement can't be imposed from above. As Acas says, it's about creating a cultural shift in the way organisations behave.

2. Leadership means having a clear vision of the future and communicating this to employees.

3. Show you value the contribution your staff make by giving them the power, the responsibility and the trust to do so.

4. Encourage their ideas for innovations and improvements. And importantly, give them proper consideration. After all, they're the ones in the front line and know better than anyone what can make a difference.

5. Allow employees to voice their views and concerns - and address them. Two-way communication is vital in business. Nothing is more damaging than unsubstantiated rumours or ill-feeling.

6. Fulfil your promises. Yes, ‘talk is cheap' is a cliché, but no less true for that. Employees will soon spot lip service and harbour a distrust of what you're telling them.

7. Ensure good staff/management relationships through people management training and techniques, and by promoting key management behaviours.

8. Healthy staff equals engaged staff. Always promote employee wellbeing.

9. Provide the right mix of staff benefits. Business benefits show employees that you care about their welfare and the financial wellbeing – helping to recruit and retain key talent.

10. An engaged workforce shows on the bottom line. When people are engaged in their roles and the business, it means better morale, less staff absence, more innovation and improvement and greater productivity.