Many business owners are now attracting their employees with certain employee benefits. Wondering what is the term employee benefits mean? What perks and benefits an employee expect to receive when they’re hired. For most of the business trying to juggle together the complex options of an employee benefits program is really a challenging task. Additionally, employees who are venturing out for a new job are not only focusing on salary hikes but also choosing a position that offers competitive fringe benefits. Before applying for the job, employers are looking for online reviews left by previous employees and understand the benefits the company is offering.
According to research, 61% of users report that they refer to job sites and see the rating before applying for a job and use 7-8 job sites in the transition of their job search.
In this phase, employers are looking for the employer paying student loans, as a kind of employee benefit. With this benefit, employers are paying student loans on account of employees at a specific amount per month as contracted with the employer. Many companies are inclined to give this, as the educational debt has increased over the past years. As against to tuition reimbursement benefits that are tax-free, these student loans are taxed on a regular income.
Employees are not limiting their scope only with a student loan, but they are a plethora of employee benefits to get from. In this article let’s dwell further and know little more about employee benefits.
What are employee benefits
Employees are the key resources for any company be it a product or a service-based. They are the main reasons for the company’s thrives to succeed. Moreover, these are non-financial incentives offered to an employee and varies with different companies. There are proposed to employees at the time of signing a contract. They are usually indirect non-cash payments included in variable compensation. They are offered by companies in addition to the salaries and create a competitive spirit in potential employees. With this, you can work hard and better. The main aim of this benefits plan is to maximize employee security and retain them for a longer duration. They are termed as perquisites, perks and fringe benefits. Few examples of employee benefits are
- Group insurance like dental, health, life etc.
- Disability income
- Sick leave
- Retirement benefits
- Vacation-paid or unpaid
- Sick leave
- Tuition reimbursements
- Social security
Usually, these perks are offered to the employees who diligently worked hard or attained seniority. They are even non-discretionary employee benefits provided by organizations that create entitlement, employee right or expectation. These are viewed from the managerial perspectives like flexitime, casual dress code and telecommuting. Some of these benefits are taxable and few are non-taxable. These became an important factor as there is an increased competition towards hiring skilled candidates.
Why employee benefits important
Well, according to research, 79% of employees want to have additional benefits rather than a pay increase. For an employee along with good wages, benefits also attract them to work. Adding extra benefits not only enhances your business productivity but also have other advantages too.
Employees are more loyal to the organization and work for a longer time when additional benefits are included in the company. According to a survey conducted, 60% of employees say they are extremely happy when additional benefits are provided to them. Besides, 72% of the employees said that the ability to choose the benefits motivates them to be loyal to the business.
Increased productivity and attention span. 51% of the employees say that they are more focused when additional benefits are offered to them.
Attendance rate will be higher. Three primary reasons for absenteeism are family, commitments, finances and health issues. If these are taken care of then there will be absentees in the office.
Better morale. Employees work more dedicatedly and take their job seriously when managers understand their needs and address the problems.
It’s a challenging task to make serious progress when employees are continuously shifting their jobs. It’s hard to retain veteran experts. Fortunately, when you offer benefits, they can stick around for a longer time. By investing in your employees, shows you value their interests and performance. Tight-knit professionals can stay for years in your office.
How to frame a strategic plan for employee benefits
As a matter of fact, it’s essential to lay a strategy and decide what offers your employees going to get regardless of the resources you hire or the budget you fix. To do that, your plan should consist of
- Focus and clear goals that need to be reviewed
- Be realistic while setting the budget
- Know the costs and be competitive
- Differentiate between optional and required employee benefits
- Articulate special perks
Creating great employee benefits or compensation package
A million-dollar question that remains in the minds of HR or compensation managers is- How to build competitive employee benefits so as to retain them. To simply put, what makes employees look for companies that offer special benefits. If a company has to retain employees of their choice, outside the salary and reputation, studies have proven that great perks are the cornerstone for success.
The questions boil down to knowing the unique goals of the individuals whether it may be millennials looking for health insurance, Gex X raising their families or baby boomers who are attaining the age of retirement. The benefits have to impact their lifestyle.
Select the expected health care benefits
Gaining access to private healthcare form the key for any standard benefits. If contributing to a full family is cost burden, then offer only for employee and extend the membership later at the business rate. Select the health perks that fit under minimum specifications. The costs of this can be deducted from their salary in instalments.
Explore at least two health care options and organizations and offer wellness coverage.
Cost-effective voluntary benefit options
Currently, many businesses have a multi-generational workforce, don’t you agree? Yes, it is. There are no plans that fit the pocket for all. Hence, there should be various benefits offered to an employee. They can opt the plans according to their unique lifestyles. Plan and work with an insurance broker or HMOs(Health Maintenance organizations) that provides numerous cost-effective voluntary benefits options. Assess the benefits like medical cash plans, cancer care, life insurance and disability insurance.
Invest in employees success
According to Zig Ziglar “You do not build businesses, build people and in turn, they build your businesses.” Hence, investing in your employees is valuable for your company’s money, time and energy. Set up L&D(learning and development) team and offer regular training to your employees. Invite industry experts or local university professors and ask them to give developmental classes. This fosters employee morale. Pay a part of the tuition fees for employees pursuing any certification programs. Focus on the financial benefits for employees who accomplish their goals and offer a reasonable raise for winning greater levels in the industry.
Continuous advancement is crucial for career advancements and one of the significant approaches for attracting and retaining high performers. These facilities include
- Developing a mentoring programme
- Regular appraisals
- Access to external training
- In some cases, this comprises of educational sabbaticals and loans also.
Provide work-life balance
Building a cordial work-life balance is vital for improving your emotional, mental and physical health. Besides, you can create a healthy career. Better work-life balance has various positive benefits that include reducing stress and burnout and promoting overall health. Form this, employees and employers can get benefitted. Many employers are keenly looking for the chance to work under an outstanding employer who understands their importance of family life too. Powerful work-life balance activities include
Excercise access. Providing a gym in the office improves the health of a person.
A family-friendly environment with childcare services.
Conducting company outings, giving perks on special days like
- Holiday parties
- Birthday celebrations
- Park days
- Happy hours etc,
Remote work is also another perk which maximizes productivity. Especially for seniors who want to move to their ideal location and spend time with families. Along with contributing their share of work to organization’s success.
The perfect benefit for working remotely is offering flexible timings to work. Additionally looking after their needs such as visiting doctor etc.
Additional ways to create employee benefits include
ESOP(Employee stock ownership plan) is similar to the profit-sharing used to motivate and inspire employees for equity ownership.
A 401(K) plan aids in recruiting employees and reduce turnover. Only 15% of the organizations between 5-99 employees provide 401(k) retirement savings benefit and yet very rare in private companies.
The ability to maximize the annual leave entitlement roughly includes 5.6 weeks including bank holidays is often sought-after perquisites. This allows employees to accrue extra days or avail extra holidays for long service. These include
- Family medical leave and
- Maternity leave
Once you’ve got an excellent staff on board, it’s a daunting task to keep them from jumping various ships. One way is by providing a great employee benefits. Among others heading the list is medical insurance. But many employees also wish to have a retirement plan, disability insurance and more. By following a few recommendations, your company benefits from a highly competitive environment appealing to a large number of employees making their career easier.