Flexible Benefits Platform Solution (including Brokering Service) and Employee Recognition Platform Solution

National Energy System Operator (NESO) is conducting a procurement to appoint supplier(s) to provide, implement, and manage digital employee experience solutions that support colleague wellbeing, engagement, recognition, and reward. NESO separated from National Grid in October 2024 and inherited as part of the employee contracts flexible benefit and recognition services supported by brokerage and a platform.

The procurement is divided into two lots:

• Lot 1 - Employee Flexible Benefits Platform Solution and Brokering Services
• Lot 2 - Employee Recognition Platform Solution and Services

NESO reserves the right to award one supplier per lot or a single supplier for both lots.

The successful supplier(s) will be expected to deliver secure, user-friendly, mobile-enabled platforms that provide an exceptional colleague experience whilst supporting NESO's strategic objectives, organisational culture, employee value proposition, and future workforce requirements.

Workforce Profile

NESO currently employs approximately 2,500 colleagues across the UK, comprising:

• Predominantly operational employees.
• Office-based support and corporate functions.
• Employees located across multiple operational sites and office locations.
• One monthly payroll.
• Benefits year running from 1st December to 30th November

The solutions must therefore be accessible, inclusive, and engaging for a geographically dispersed and diverse workforce.

NESO seeks to appoint a supplier to provide, implement, manage, and continuously develop an Employee Flexible Benefits Platform and associated brokerage services.

The solution must provide a comprehensive range of flexible and voluntary benefits through a modern, intuitive digital portal that enables employees to easily access, understand, select, and manage benefits throughout the year.

The successful supplier will be responsible for delivering a fully managed end-to-end service including:

• Platform provision and hosting.
• Implementation and onboarding.
• Branding and user experience design.
• Benefit administration.
• Brokerage and market engagement services.
• Employee communications and engagement campaigns.
• Helpdesk and user support.
• Reporting and analytics.
• Account management and continuous improvement.

The platform must provide a consumer-grade experience and be accessible via desktop, tablet and mobile devices.

Benefits Enrolment and Administration

The platform must support both annual and rolling enrolment models.

NESO currently operates:

• An annual enrolment window during November of approximately three weeks.
• Benefits selected during annual enrolment becoming effective from 1 December each year.

Lot 1 Contract Value Composition

The estimated value of Lot 1 comprises the components set out below. The valuation reflects the full anticipated value of the arrangements to be managed under the contract, including underlying benefit spend, provider charges, employee contributions and the services to be procured directly from the appointed Supplier.

Approximately 96.4% of the total estimated Lot 1 value relates to benefit spend administered direct through voluntary employee selection,

For the purposes of this procurement, the estimated Lot 1 contract value is comprised the following elements:

• Health, Protection and Wellbeing Benefits - Voluntary Salary Sacrifice Benefits - approximately 88.8%. This element relates to brokered insured employee benefits. The appointed Supplier will be required to provide advisory and broking services to support the identification, assessment and recommendation of appropriate benefit providers through competitive market engagement and procurement activity. NESO anticipates contracting directly with the selected providers; therefore, the estimated Lot 1 value includes the anticipated spend associated with those underlying benefit arrangements.
• Lifestyle and Home Technology Benefits - Voluntary Salary Sacrifice Benefits - approximately 7.6%. This element relates to employee benefits that are currently available to NESO employees but are not presently managed through the existing brokering arrangements. These may include, without limitation, Cycle to Work, Home Technology and Smart Device schemes, Retail Discount schemes and comparable employee benefit offerings. The associated values primarily reflect employee benefit expenditure, participation costs and sums administered through the relevant benefit arrangements.
• Benefits Platform, Administration, Brokerage and Advisory Services -approximately 3.6%. This element relates to the services being procured directly from the appointed Supplier, including platform hosting, enrolment administration, integrations, communications, user support, independent advice, market brokering, negotiation, implementation and ongoing management of benefit arrangements with insurers and third-party benefit providers.
• The estimated values stated above include, as applicable:
• NESO costs and contributions associated with the provision, administration and management of employee benefits; and
• Employee contributions made through payroll deductions in connection with benefit selection and participation.

On this basis, approximately 96.4% of the total estimated Lot 1 value relates to benefit spend, provider charges and employee contributions expected to be administered through, or in connection with, the Lot 1 arrangements. Approximately 3.6% relates directly to the benefits platform, administration, brokerage and advisory services to be delivered by the successful supplier.

The inclusion of all anticipated benefit expenditure within the estimated contract value is intended to reflect the total value of the arrangements managed under Lot 1, in accordance with the valuation requirements and principles under the Procurement Act 2023.

During the term of the contract, NESO may, where appropriate and subject to supplier capability, seek to incorporate currently unbrokered flexible benefits into the overall Lot 1 service arrangement. The estimated value of these benefits has been included within the Lot 1 contract value and represents approximately 7.6% of the total estimated value.

NESO reserves the right to re-issue the contract during the tender process due to NESO's Preferred Position on Agreement for 1) General Terms; 2) Software As A Service (SAAS) Terms; and 3) Configuration Support Services Terms. During the Framework term, NESO also reserves the right to review opportunities to consolidate reward and benefits-related contracts across Lot 1 and Lot 2, where appropriate. Any consolidation would aim to improve transparency, strengthen governance, and enhance visibility and management of NESO's overall reward and benefits portfolio.