An Employer’s Guide to Navigating Benefits Packages
For modern organizations, deciding whether to build comprehensive employee benefits packages is becoming less of an option. Benefits play a major deciding factor for potential job candidates when looking for an employer, and businesses that aren’t investing in this perk often experience more challenges when locating quality talent.
However, you’ll want to consider various things when designing your benefits offering and make sure you’re choosing the right options for your business.
Why You Should Consider Offering Employee Benefits
When you create a great benefits package for your employees, you’re investing in their well-being and supporting your business. Below are some reasons why you should consider offering employee benefits:
Attract and Retain Top Talent
Considering how competitive today’s job market is, it’s critical for businesses to set themselves apart from other companies, all of whom are vying for the attention of job candidates. Having a comprehensive benefits package in place is a great way to do this and shows potential job candidates where your priorities as an organization lie – with your employees.
Improve Employee Morale
A quality benefits offering can provide a strong psychological motivator to employees. When employees feel like they are being valued highly and supported by the organizations they work for, they are much more likely to stay engaged with their work. This translates to higher productivity levels in the business and fewer absences.
Enhance Your Company’s Reputation
Building a strong brand reputation is critical for a variety of reasons. First off, when you’re known for being fair and generous to employees in the benefits you offer, it makes it much easier to source new talent. On the other hand, having a reputation for treating your employees well helps to create more trust and credibility with customers.
Reduce Overall Healthcare Spending
When employees don’t have adequate healthcare insurance, they are less likely to seek medical attention or complete health screenings as needed due to the heavy out-of-pocket expenses they may have. By incorporating healthcare benefits into employee compensation packages, businesses can help their employees lead healthier lives while helping to reduce total expenses.
Common Types of Employee Benefits
For modern-day businesses, there are a significant amount of choices available when it comes to structuring benefits packages. However, below are some of the most common inclusions that most businesses consider making part of their total compensation offerings:
Health Benefits
Offering a comprehensive health benefits package is often one of the primary elements of employee benefits offerings. Depending on the depth of healthcare benefits you’re looking to offer, these packages could include coverage for visiting doctors, stays in hospitals, reduced spending on prescription drugs, and various forms of preventative healthcare.
Many employers will also include other healthcare benefits, including dental and vision plans. Businesses can also offer their employees Flexible Spending Accounts (FSAs) or Health Spending Accounts (HSAs) that enable employees to use pre-tax dollars to cover any out-of-pocket healthcare expenses they may have. Businesses can then reimburse full or partial amounts of these expenses as needed throughout the year.
Financial Security
Providing benefits that help support your employees’ financial security is another great way to give them peace of mind. Financial security benefits could include retirement plans or employer-matched contributions to RRSPs (Registered Retirement Savings Plans).
Other forms of financial security for employees and their families could include certain life insurance policies or disability insurance. Life insurance helps an employee’s family to continue to be supported financially in the unfortunate death of a spouse. In contrast, disability insurance can be a supplemental income replacement if an employee is critically injured an unable to work for extended periods.
Paid Time Off
It is critical to ensure employees have adequate time off to recharge their batteries and take care of their personal commitments. Today, more and more individuals are finding it hard to balance their personal and work lives, and ensuring your business prioritizes this can be highly beneficial for both the employee and the organization.
Businesses could consider offering more generous vacation allotments than legally required in their area while adopting more flexible sick and personal days. Knowing that they won’t be penalized financially for taking care of themselves when they are ill, employees are much more likely to remain with an organization that has these benefits included in its packages.
How to Design a Competitive Benefits Package
When you’re ready to start creating your own employee benefits package, there are some effective strategies you should put in place. These include:
- Evaluate Your Workforce – Not all businesses are created equal, and this extends to the needs and preferences of your employees. When designing a benefits offering that makes an impact, consider the demographics of your employees and their family situations. To do this effectively, you may want to conduct an employee survey so you can hear firsthand what types of benefits are most appealing to them and their situation.
- Define Your Budget – It’s important to remember that putting together a comprehensive employee benefits package can be a significant business expense. This is why it’s critical to design a reasonable budget that you can use to make sure you’re balancing employee needs with the business’s fiscal responsibilities.
- Prioritize Benefits Choices – Once you have a good understanding of your workforce, their benefits priorities, and your budgetary restriction, you can start prioritizing your benefits options. You’ll want to have a list of “nice-to-haves” along with “essential needs” to make sure you’re creating the right mix of benefits that will keep the majority of your employees happy.
- Competitive Research – To ensure your benefits offerings align with industry standards, you’ll want to do comparative research with your competitors. The last thing you want to see is employees leaving the organization because they feel they can get better value from another employer. By seeing how your competitors compensate their staff, you can ensure your present offerings remain attractive.
Put Together a Great Benefits Package for Your Employees
Creating a competitive employee benefits package is a strategic investment for your business that can pay considerable dividends over the years. By following some of the guidelines discussed, you’ll be sure to choose a benefits offering that provides real value to your employees while helping improve productivity and reduce employee turnover.
- An Employer’s Guide to Navigating Benefits Packages - August 28, 2024
