To the employer benefits have a double use. The first is that they can be a tax efficient method of increasing the incomes of the employee. The vagaries of the tax system mean that some benefits (health insurance, pension contributions) can have a certain value to the employee but they cost less to provide than certain others (wages, company cars) that would have the same value to the employee. As it is the total cost of an employee which is the deciding number for a company, not the net in the pay packet, this means that by careful evaluation of a benefits package a company can raise the apparent salary for a specific job while keeping that total cost constant. That should other things being equal, mean more and better qualified applicants for that job: something of course to be desired.

The other thing is a twist of human nature: we're used to he idea of looking around for more income, of thinking of switching jobs for a higher salary. We do so rather less for things like benefits which we don't look at in quite the same light: odd, but we don't. So a decent benefits package should, again, other things being equal, lead to more loyalty to the company.

From the point of view of the employee benefits are of course important as well. They are rightly seen as part of the total employment package and thus something to consider as part of the total package. Such things as health care, cars and so on are sometimes tax sensible to get through the employer, sometimes not (with current rules on cars for example, it's a very fine decision nowadays).

What all of this means is that an employer looking to attract a certain type needs to work very closely with the consultants at Talisman to make sure that the benefits package is commensurate with the job. To low a package and it won't attract the right applicants: too high and it will be taking too much of the resources available to pay for the job. There is a delicate balance to be reached there.

The correct benefits package will be designed to create the maximum loyalty to the company while still managing to make the payment of the employee as tax efficient as possible for both parties: given that the Chancellor likes to change those equations at least once a year...well, that's what the experts at Talisman are for, correct?