The Pros and Cons of Cycle to Work Scheme: Everything Employers Need to Know
Are you looking for a new employee benefit to invigorate your team and reinforce your company’s commitment to health and sustainability? You need the Cycle to Work Scheme.
The Cycle to Work Scheme, specifically Cyclescheme, is one of the UK's most popular employee benefits - and for good reason!
In this guide we explain:
- - What Cycle to Work Scheme is
- - Pros - the perks of getting your team pedalling to work
- - Cons - the potential hurdles you might face
- - And finally, how you can make cycling part of your workplace culture
The Cycle to Work Scheme is a brilliant UK government initiative that encourages employees to ditch the car and cycle to work instead.
Employers that join the scheme help their employees save up to 42% on a brand new bike and cycling equipment. It is a salary sacrifice benefit, which means employees benefit from tax and National Insurance savings on the cost of the bike too.
Employers technically 'buy' the bike and cycling accessories the employee wants (up to a pre-agreed limit), and then the employee rents it back over an agreed hire period (usually 12 months). The employee spreads the cost of the hire by making monthly payments for the bike rental through a monthly salary sacrifice.
At the end of the hire period, the employee will be given ownership options. They can either:
- - Extend the hire period (at no cost to the employer or employee)
- - Pay an ownership fee to take full ownership of the bike immediately
- - Or return the bike to Cyclescheme
We explain what all of these options are later in this guide.
Are you ready to get your team pedalling? Click here to create your free BHN Extras account, likewise, if you have any questions or would like to talk to our team, click here.
Pros of Cycle to Work Scheme for Employers
There are plenty of pros for businesses when it comes to the Cycle to Work Scheme. Not only do employers benefit from a happier, healthier and more productive workforce, employers also recover the full cost of the bike and generate a National Insurance Contribution saving up to 13.8% of its value!
As well as the financial savings, cycling boosts employees health, cuts down on commute costs and also reduces environmental impact. An impressive 82% of Cyclescheme participants said that they felt less stressed after commuting by bike!*
It's no wonder over 50,000 employers already offer Cyclescheme as a salary sacrifice employee benefit.
There are many, many perks to joining Cyclescheme. We’ve listed our favourite pros below.
Improves Employee Health and Wellness
When your team cycles to work, they’re not just burning calories - they’re boosting their mental and physical health. The payoff? A happier and more energised workforce. And a healthier team is more productive and likely to take fewer sick days!
Champions Environmental Sustainability
Embracing cycling and introducing Cyclescheme as a benefit helps your company reduce its carbon footprint, showing a commitment to environmental sustainability and your Corporate Social Responsibility (CSR) - a big plus in the eyes of clients and potential hires.
Attracts and Retains Talent
Companies that focus on their staffs wellbeing and promote an active lifestyle have a healthy advantage when it comes to attracting and hiring new talent. Offering desirable employee benefits, like Cyclescheme, and other staff perks, helps make your company a preferred place to work.
A Huge Choice of Bikes and e-bikes
Cyclescheme is partnered with more independent bike shops and bike retailers than any other cycle scheme. That means when you sign up with us, your employees get access to the widest range of bikes and safety equipment. Your employees can choose a bike to suit their needs, including road bikes, mountain bikes and electric bikes.
No Cost To Employers - A Cost Positive Benefit
While employers do cover the initial cost of the bike, this is repaid fully through the salary sacrifice arrangement. As well as getting the cycling equipment and bike cost back, employers also get a National Insurance Contribution saving up to 13.8% of the cycling gears value!
Completely Free to Join
Cyclescheme is the UK's most popular bike to work scheme provider for good reason. Completely free to join, we have the largest amount of bike shops and retailers for your employees to shop at. As well as that, when you choose us as your Cycle to Work scheme provider, you also get access to our employee benefits platform with some extra free perks!
Access to Even More Free Benefits
As we mentioned in the point above, BHN Extras is a free-to-use employee benefits platform. That’s right – free. There is no sign-up cost, no monthly usage charge, no minimum contract period and no per employee seat fee. When you join Cyclescheme through our BHN Extras benefits platform, not only do you give your employees access to benefits like bYond (employee cashback card) and Extras Discounts (discounted gift cards and vouchers), you also give them 14 days free insurance on their bike and access to the Cyclescheme Strava Club.
Easy End of Hire
When your employees reach the end of their hire agreement, we will handle the whole process for you.
Employees are offered three ownership options:
Option 1: Own It Later (Extended hire period)
For a small cost (up to 7% of their Cyclescheme package value), employees can opt to extend their hire agreement for an additional 3 years (with no further monthly repayments needed). This is the most popular option for many employees, as after the 3 years is up - they take automatic ownership of their package. By extending the hire period, employees can benefit from typical savings of up to 42% on a bike's retail price.
Option 2: Own It Now (Pay Ownership Fee)
Employees can take immediate ownership of their bike by making a one-off payment for the current market value, in accordance with HMRC requirements.
This ownership price is calculated as a percentage of the scheme Certificate's original price.
Option 3: Return Package
If employees no longer want or need their bike and cycling equipment they can opt to return it to Cyclescheme. There will be no additional payments to make, but employees will not have their salary sacrifice contributions returned.
Cons of Cycle to Work Scheme for Employers
It all sounds a bit too good to be true so far. So let's take a look at what the potential cons of cycle to work scheme for employers are.
The Set Up Process
It's the question we hear most, "Is it complicated to set up?".
Not to blow our own trumpet too much, but while this step might be tricky with other providers, when it comes to getting started with Cyclescheme we make things really simple. We're pros at handling the admin side of things, and after a few quick questions we'll have you up and running- or should we say rolling - in no time!
Getting Staff Buy In
You also get access to our resources portal, which is full of free marketing materials and tools that help promote this amazing new benefit internally.
But, even if none of your current staff decide to use this benefit, the cost to you is absolutely nothing and can help attract top talented staff in the future. So it’s worthwhile signing up now, even if the most take-up is later down the line.
Bike Storage
One thing companies must also consider is where staff will store their bikes during the working day. You might need to install bike racks or lockers. Some companies also look into installing showers to allow staff to freshen up when they get into the office. A small investment in facilities can lead to big returns in terms of participation and employee satisfaction, now and in the future.
Upfront Funding of Bikes
If a high take-up is expected, some companies have been concerned about funding the cost of the bikes upfront.
Another benefit of choosing Cyclescheme as your Cycle to Work Scheme provider, is that you don’t have to worry about how many of your employees join the scheme, as we have systems in place that mean businesses can pay for the bike(s) when the salary sacrifice payments start to come in.
Bike & Cycling Gear Insurance
Insurance is also super easy with Cyclescheme. We’ve partnered with award-winning cycle insurance provider, Bikmo, to give all Cyclescheme users 14 days free insurance on their new bike and cycling gear, plus exclusive discounts on ongoing insurance policies!
At no extra cost to you, or your employee, they can cycle their new bike worry free thanks to Bikmo. Another reason why Cyclescheme is the UK’s most popular Cycle to Work Scheme provider!
Step by Step Guide to Joining Cycle To Work Scheme
Totally free to join and with tons of staff and business benefits, why wouldn't you want to join Cyclescheme? Just follow these 6 easy steps to introduce the Cycle to Work scheme to your business.
Step 1: Join Cyclescheme
Click here to join Cyclescheme and get access to your new free employee benefits platform.
Step 2: Get the Word Out
Use our free marketing materials to tell your staff about this amazing new benefit.
Step 3: Get Shopping
Your team chooses their cycling gear from one of our 2,600 retailers and sends a request through the online system. You approve this in one easy click!
Step 4: Distribute Vouchers
Once approved, your employee will be emailed with a scheme voucher that they can use to purchase their chosen bikes and gear and start cycling to work!
*2017 Cyclescheme survey of 1,000 participants.
