Evaluating Employee Benefits
Each year employers typically reevaluate the benefits offered to their employees. It is important to note that what may be traditionally important to Baby Boomers who have either just entered retirement or are well established in their careers, may not be as important to the Gen-Xers and Millennials. This article focuses on employee benefits no matter what generation you are fortunate enough to belong.
Recruitment Package, Compensation, and Incentives
Employee benefits are often used as a recruitment perk. When prospective candidates are job shopping, evaluating the richness and depth of the employee benefit package may serve as the decision point of whether someone takes one job offer over the next. Since most benefits are typically standard across levels of employment, the one differentiator may be whether you offer the candidate a sign-on bonus. A sign-on bonus can be paid during their first year and does not translate to a higher salary the following year. You can also build in a quarterly and annual bonus structure into the employment package based on their contribution to the company’s performance. Creatively building in incentives at the start of employment is a competitive advantage companies should consider if they want to hire and retain top talent.
In addition, it is vital that employers bring on new employees for what they are worth based on their experience, achievements, and if applicable, education. Bringing a qualified person in at the minimum of their pay grade will only cause issues in a few months when they realize they are being severely underpaid as compared to their peers. Watching company finances is important but not to the point where you are known to employees and the industry as being a cheap employer.
Health insurance options may change from one year to the next, especially during this time of Healthcare Reform. A wise employer will continuously reevaluate their health insurance package. Whether your benefits’ department works directly with the insurance company or through a trusted broker, stay tuned in to what your employees want. Which plans are more popular with your employees? Do they find value in certain plans over other plans? As an employer you must not only pay attention to your financial bottom line but you must also pay attention to what your employees’ value. You can do this by reviewing their selections as well as ASKING them. If you are able, provide your employees with a comprehensive health insurance package. Let them choose which plan works best for them. And be open with how much the employer will contribute towards the monthly premium.
Does your company offer a retirement plan? If yes, you are in the game. If not, your company may not see it as a vital benefit offering today for several reasons. Maybe an employee poll only showed less than 25% of people who would enroll in the plan. Or maybe you are a new company and are not sure if you will be in business next year. Whatever the case, do your research. Meet with an investment firm to determine if offering a retirement plan is the right thing for you as an employer and for your employees. And even if you are unable to offer a plan as the employer, you could arrange to have a financial planner come in to meet with your employees as they may wish to sign up on their own.
Vacation! Vacation!! Vacation!!! Sometimes it seems like certain employees are ALWAYS on vacation while others seem to cap out year after year and are forced to take vacation. That is the employee’s decision and has nothing to do with the employer. The employer is only tasked with deciding if they will offer vacation to their employees. If you do decide to offer vacation and / or paid time off to your employees, determine if what you are currently offering is sufficient or if you need to make changes. Keep in mind, setting it up right the first time is better than restructuring it in two or three years. Change is not always met with open arms even if it is in the best interest of everyone. Consider what vacation plans are appropriate for new hires versus an employee who has been with the company for ten years. Are you an employer who has the flexibility to offer sabbatical plans? If so, that is one way to reward long-term employees with extended time off. It is important to look at your business and offer what is reasonable as a company yet valuable and seen as a perk by your employees.
Flexible Work Schedules
Another employee benefit that employers are increasingly evaluating is Flexible Work Schedules. Working parents are being asked to actively participate and volunteer for school projects which occur during work hours. Other employees prefer working a four day work week at ten hours per day. Employers who allow their employees flexibility with their schedules are hoping to reap the benefits too. They are hoping that by allowing their employees time off to tend to personal matters that when they are at the office they are 100% focused and dedicated to the job at hand which ultimately may result in a more productive employee.