Benefits for employees are essential to keeping and attracting employees. But, providing competitive benefits could be a difficult task between keeping employees satisfied and reducing expenses. Smaller businesses, providing benefits can be a challenge.
Even with the cost the benefits offered by employees are vital. According to Aflac, 49 percent of employees will search for an opportunity within the first 12 months after starting when they’re not satisfied with the benefits offered by your company.
In addition, as people leave jobs in record numbers due to the Great Resignation, providing competitive benefits is more crucial than ever before.
In this economic downturn providing benefits is crucial to attract and retain employees, particularly for small-sized businesses. It is important to keep in mind that investing into your staff is an investment into your company, with substantial benefits for retention of employees productivity, morale, and productivity.
In addition to the value of health insurance for employees, let’s take a look at the reasons why providing employee benefits is important for small-scale businesses.
Five benefits of providing employee benefit services
Let’s look at the five main advantages of providing employee benefits.
1. Retention and recruitment of key employees
Today’s workers appreciate and expect employers to provide high-quality benefits. The results of the Glassdoor Employment Confidence Survey show that 4 of five employees would prefer to have more benefits or new ones instead of a raise in pay.
Smaller employers can have an opportunity to compete against larger companies that have the funds to pay higher salaries. Even if you don’t have the money to pay a large salary, providing a enticing benefits package can get the best applicants to your door and will help keep the best of them for a long time.
2. A healthy and happy workforce is productive.
Employee benefits can supply your employees with the resources they need to stay healthy and productive and can be an opportunity for both your company and your employees. Wellness benefits can comprise health benefits as well as other benefits for wellness, such as fitness memberships and psychological health assistance.
In particular, giving access to high-quality healthcare and wellness programs for employees–and making a contribution to the cost, removes the financial burden for families and employees. For employers providing health and wellness benefits could result in fewer absences and sick days. This is a tangible ROI on the investment you make in your employees.
3. Morale and culture
In a small-sized company is commonplace to have close relationships with your employees. In terms of morale and culture employees are able to feel this mutual respect. Being aware that their employer cares about their health and well-being increases employee satisfaction and retention.
In a study conducted by Science of Care, 60 percent of employees who said they were being treated with respect by their employers also stated that they were planning to remain at their employers for a period of three or more years in comparison to 7 percent of those who said they felt less taken care of from their employer.
Furthermore, providing employee benefits such as remote work could increase the morale of employees. Based on the results of an Owl Labs survey, 22 percent more employees said they’re satisfied working remotely than workers who did not work remotely.
4. Tax benefits
A lot of employee benefits are tax-deductible for both your company and your employees, and not only the ones you’d typically think of, such as contributions to retirement and healthcare plans.
A variety of other employee benefits are tax-free for example:
Healthcare reimbursement
Life insurance
Tuition reimbursement
Child care reimbursement
Cafeteria plans
Employee discounts
The personal use of a company-owned vehicle
Cell phones provided by the company
Lunches are provided by the workplace
5. A solid foundation for expansion
Another benefit for employee benefit plans is they establish the foundation for your business to grow and scale. When you add many more people, having a an exclusive and appealing employee benefits program will help you recruit, retain and retain the most skilled employees.
According to research conducted by LinkedIn the companies that were highly rated in terms of compensation and benefits by their employees experienced 56% less attrition than those that were not rated highly.
What are the most important benefits for employees?
The selection of the best benefits for your employees is crucial to the effectiveness of your benefits package. When you are deciding on the benefits you want to provide your employees, conducting a survey of benefits for employees is a good place to begin. Ask your employees what benefits they’d like to see included in the benefits package.
However, there are some benefits that employees want more than other employees. According to an Gallup survey, wellbeing is the most desired workplace benefit for younger workers. This includes wellness and health benefits and flexible working hours.
The most sought-after benefits of working include:
Healthcare benefits
Wellness programs
Remote job possibilities
Flexible work hours
Unlimited paid sick time and pay-for-sick leave
Parental leave
Retirement benefits
Career development
Tuition reimbursement
Disability insurance
Let’s look at how you can provide a few of these benefits that are top within the following sections.
How do you provide employee health benefits while on a tight budget
As per the Society for Human Resource Management 90% of employers consider healthcare to be the top employee benefit. While the value of benefits for employees is not overstated however, it is a challenge for small-sized businesses to set up a cost-effective plan.
The cost of traditional group health insurance policies are usually too costly for small-sized businesses. Moreover, the rising costs of healthcare have created group health insurance policies that are more difficult for businesses to manage.
Healthcare reimbursement plans (HRAs) are an excellent health insurance option for large and small businesses alike. With an HRA you can provide the employees you employ with a monthly allowance to cover medical expenses. Employees submit their eligible expenses to be reimbursed and receive reimbursement tax-free.
You can select the amount of allowance available to your employees every month. The best part is that when you have an HRA the allowances that are not used at the time of the benefit year’s end remain with you. This way, you’re only paying for health care expenses that your employees actually need.
There are three types of HRAs that are available to small-sized companies. They include:
Qualified Small Employer HRA (QSEHRA) is an HRA that was created under the Affordable Care Act (ACA) which is specifically designed for small-sized businesses with less fifty full-time equivalent workers (FTEs). The annual allowances are limited through the IRS.
The HRA with individual coverage (ICHRA) An HRA that is available to companies of any size. Employers are able to customize employee classes and provide any amount of allowance without limits. All employees must have health insurance that is in line with the minimum coverage requirements (MEC).
The Group Coverage HRA (GCHRA) – Also called an HRA that is integrated, it is specifically designed to be used in conjunction with an insurance plan for group health like HDHP, which is a high-deductible health insurance policy (HDHP).
A health stipend can be a flexible option to assist employees with health-related expenses. Health stipends function similarly to an HRA in that you are able to determine monthly allowances for employee reimbursement. But, unlike an HRA health stipends, they are tax-deductible.
Similar to an HRA health stipends may be used to pay health insurance premiums as well as out-of-pocket costs. With less regulations as HRAs and medical insurances, health stipends allow your employees greater influence over their medical affairs.
How do you offer employees perks for their work? companies
Stipends for employee perks, also called fringe benefits are another method of providing affordable employee benefits to small-sized businesses.
Stipends let you give employees monthly allowances for various costs such as wellness and remote work. Similar to the health stipend, you can have your employees can submit a request for reimbursement of the expenses you permit.
Employees can be reimbursed for their fitness classes, gym memberships and trackers for fitness as well as meditation and mental health apps, and much more by offering an employee wellness allowance. Flexible employee benefits improve your employees’ overall health and lead to greater productivity.
Keep in mind that wellness is the most sought-after benefit among young employees. A wellness stipend can allow you to compete against bigger companies that might not offer flexible benefits for wellness.
If your employees work remotely You can offer remote workers a stipend for remote work. If employees are working in person at their workplace, they utilize the equipment provided by their employers, as well as internet and other amenities. If they work at home it is their own broadband, internet connection and space to work. Employees are able to use monthly payments to cover home office expenses, like internet and phone bills.
A remote pay stipend will ensure the employees you employ are adequately prepared to work at home. It could be a great incentive to potential employees.
Conclusion
Benefits for employees are important even for small-scale businesses. In the wake of Great Resignation inspiring millions of employees to quit their jobs to pursue more opportunities, benefits are an excellent way to draw and keep employees.
