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How important is it for employers to offer an attractive employee benefits program in today’s business climate? This important:
According to a survey conducted by The Harris Poll for the American Institute of CPAs (AICPA) conducted in 2018, 80% of the people that were polled said that they would choose a job with benefits over an identical job that had a 30% higher salary but no benefits.
It has become crystal clear that companies that don’t offer advanced and well-designed benefits plans to their staff members are fighting an uphill battle when it comes to attracting top talent and retaining their best employees.
Sure, there are some employee benefits that are mandated by law, but simply offering the benefits you’re legally required to offer is not going to cut it anymore. So what are employees looking for from a benefits program? What benefits can your company offer in order to stand out and attract top-tier employees?
In the broadest possible terms of classification, companies can offer a combination of monetary and non-monetary benefits. Monetary ones are easy and are usually offered as a series of bonuses and monetary incentives that reward employees for jobs well done.
However, getting the non-monetary benefits that you’re offering right is going to be the bread and butter of your employee benefits program. This entails picking the right services to offer and being able to properly recognize what benefits your employees would appreciate and, well, benefit from most.
This is why designing a proper employee benefits program is not easy. But the reality is that investing in such a program is absolutely vital, as it can represent and define your organizational foundation and company values.
Let’s take a look at the steps any business needs to take when striving to put together the best possible benefits program for its employees.
Know What You Want to Accomplish
The better you are at defining what the objectives of your benefits program are going to be, the easier it will be for your company to design and install it. But this doesn’t mean that you need to know at the onset of the process exactly what benefits you are going to be offering.
It means that you should be taking steps towards understanding what you want to accomplish with your employee benefits program—both in terms of how it will benefit the company and your employees.
Of course, you’re not going to know what benefits your employees truly want unless you ask them outright, which is why your employees need to be included in the process from the start.
Get Employee Feedback
In order to know what type of benefits should be part of your program, go straight to the source and ask your employees. Getting employee feedback, whether it be through surveys or one-on-one talks with staff, will help you narrow down the list of benefits that your company should be targeting.
If you already have an employee benefits plan that you would like to improve on or revamp completely, get the employees involved in this process as well. Let them tell you what they think of the current plan and which benefits they are or aren’t using. Contact your insurer if you are offering medical plans and health benefits to get an idea of how much and to what extent these types of benefits are being utilized.
Surveying employees and getting them involved in the process also helps your company show that you truly care about their opinions and want to provide them with the benefits that they truly want.
Once you’re done with surveying your staff, continue researching every angle that could provide you with clues that could help you create the best possible plan.
Take a look at recent trends and market research and what they are pointing to as popular benefits, identify what benefits your competition is offering; use anything that can help point you in the right direction.
Know Your Budget and Financial Situation
Unless you’re a Fortune 500 company or a unicorn startup with money to burn, you’re probably not going to be able to afford every single employee benefit you and your team want.
That’s why it’s important to know right away what type of budget is available for spending on benefits. The process of creating and analyzing an employee benefits budget is not something that anyone can do. Companies should absolutely hire an accountant or some other type of financial professional to help with this process.
It’s important to remember that many of the most popular and prominent benefits, such as health insurance, should be expected to constantly increase in cost, even if your employee count isn’t growing. That’s why hiring someone, whether in-house or outsourced, to help navigate the financial landscape and provide assistance to your company with these very involved and complex budgeting projects is prudent.
If you are a small company, it’s always a better idea to spend what you can afford instead of trying to compete with benefits programs that larger companies offer and ending up in financial trouble because of it.
At this point, you should know what benefits your employees would want most and you should be aware of your budget. With this information at your disposal, you should be able to make the right decisions once the process of designing your employee benefits program begins.
Design Your Employee Benefits Plan
As we’ve already discussed, even with all of the planning and groundwork you’ve put into the process, designing your employee benefits plan is still going to be a daunting task with many factors that need to be taken into consideration.
- Does your current plan need to be revamped or completely scrapped?
- What can you do to cut costs?
- Are there benefits that aren’t being used? If so, is it better to focus on getting employees to use them, or is it a sign that they should be excluded from your plan?
- Will employees have to contribute or are you covering all of the costs?
- Are you going to hire a third-party administrator to successfully implement the benefits?
These are questions that need to be answered and ones that, when answered, will give you a clearer picture of what your employee benefits plan is going to look like when all of the pieces come together.
Inevitably, your company will be forced to make hard decisions in an effort to find a balance between the benefits your employees want most and what you can afford to implement currently.
To give this decision-making process a stricter and easier-to-navigate form, start with your “must-have” employee benefits and then move on to secondary benefits that you might be able to tack on to the program once you’ve checked all your most pertinent boxes.
When we talk about essential benefits, we are not talking about the ones that are mandated by law. Those are required benefits. An essential benefit would be something like health insurance.
While health insurance is required for companies that have more than 50 employees, almost any company that wants to attract great employees will offer health insurance, even if they aren’t required to do so. The same goes for life insurance, disability insurance (which is required by law in several US states), and retirement plans.
If your budget won’t allow you to offer all of these, use the data you’ve gathered from your employee surveys and market research to choose which combination of essential benefits will work best for your staff and your budget.
Some companies follow the philosophy that it’s better to strive to offer all of the essential benefits instead of trying to add “fringe benefits” that might not be as popular or requisite. However, this really all depends on the type of company you’re running.
For example, if you’re a startup that mainly attracts young people in the 20s and 30s, there might be more people who want benefits such as tuition reimbursement, child care subsidies, flexible work arrangements and hours, and pet-friendly offices than those who are already thinking about a retirement plan and how that would be a great benefit to have.
That’s why it’s so important to remain dedicated to the process of designing an employee benefits program for the long run, which includes constantly keeping your finger on the pulse of what your employees want and how happy they are with what they are already getting from you.
Evaluate Your Program Regularly
Once your employee benefits program has been installed and has been operating for a solid period of time (six months to a year), make sure that you have an evaluation process ready to go as well.
In order to offer your staff the best possible program, it’s important to periodically review and assess your program to see if your employees’ needs and company’s objectives are being met.
Again, market research can come in handy during this phase. Use benchmarking and trends to determine how effective your program is and, once again, make sure that your employees are included and surveyed during the evaluation process as well.
However, if you’re feeling overwhelmed by the process of putting together an employee benefits program and feel that you could use some expert help, don’t hesitate to reach out to set up a meeting with one of our employee benefits experts today.
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