Your benefits package is key to hiring and keeping top employees. Here are 4 benefits you don’t want to miss.
In the war on acquiring and retaining talent, the most generous benefits package a company can provide typically tips the scales in your favor. Workers are looking for the best starting wage they can leverage, but benefits and perks are as much a part of the equation as dollars.
We recently surveyed over 1,000 small business employees to get their take on the benefits that mean most to them. Topping the list was medical insurance. This perk may be the most important benefit an organization can offer to potential hires and existing staffers. Three other benefits employees want for their top 4 must-have may surprise you.
Medical benefits top employee lists of desired perks. The cost of healthcare continues to skyrocket in the United States and around the globe. Employees are concerned, rightfully, that small medical issues and catastrophic health events could devastate their finances. When employers provide even the most minimum coverage, staff members are assured they can likely weather a healthcare storm.
As the country moves through the COVID-19 pandemic, the focus on healthcare coverage has never been so targeted.
As the country moves through the COVID-19 pandemic, the focus on healthcare coverage has never been so targeted. While the U.S. government is covering the cost of healthcare for COVID-19-positive patients, emphasis has shifted to having adequate medical coverage — no matter your age or current health status.
Options for business
Employers have many options when considering providing healthcare benefits to staffers. When sifting through their choices, cost and administrative responsibilities are top-of-mind considerations.
SMBs can work directly with carriers to negotiate benefits. With these arrangements they will need to comparison-shop many carriers for the best coverage possible at their price point. Next, they’ll need to administer new hire enrollment and annual open enrollment. SMBs that manage their own healthcare plans or are self-insured must also understand the benefit enough to help workers leverage their plans for optimal use. They’ll also be the point person whenever there’s a problem. This can be overwhelming for many, who turn to other options.
Many SMBs work with third-party providers to provide healthcare coverage for staff. These platforms make it easier to shop for the right coverage — providing information on all the options available in every price range. They’re also in charge of enrollment administration and are available to answer employee questions and concerns. For SMBs, outsourcing healthcare coverage is a smart time- and cost-saving choice.
The Affordable Care Act (ACA) exchanges are another way employers can provide coverage. The Small Business Health Options Program (SHOP) Program has options for businesses with 100 or fewer full-time employees. These include varying levels of coverage and provide some tax incentives for enrollment.
Health Reimbursement Arrangements (HRA) are another way employers can help staff manage medical insurance needs. Accounts are set up and funded by the employer at the beginning of the year with monies employees use to purchase their own healthcare coverage. Staffers can purchase through ACA exchanges or privately.
Dental and vision
Business can go beyond medical coverage to provide dental and vision insurance to staff members at surprisingly low costs. Remember that healthcare coverage provided by employers provides more than peace of mind to staffers — there are tax benefits as well. Employee contributions are taken on a pre-tax basis, lowering payroll tax costs. Plus, employer contributions are tax deductible as legitimate business expenses.
While no one wants to dwell on their mortality, everyone knows the value of life insurance. Particularly for employees with families and dependents, this benefit could be a lifeline for an employee’s survivors. Employer-sponsored life insurance plans are typically a low-cost, high benefit option for staffers. While you can purchase life insurance as an individual, more Americans get life insurance coverage through work than through any other source.
A portion of life insurance premiums paid for by employers can also be tax savings. The first $50,000 of life insurance coverage a business provides its employees can be deducted from the worker’s overall compensation — lowering their, and their employee’s, payroll tax obligation. Any amount above $50,000 is considered taxable income. Life insurance is a smart benefit to provide, that’s easily affordable.
No matter your age, it’s important to plan for the future. Whether just out of college or nearing the end of their career, employees primarily look to their place of work for assistance in planning for and funding their retirement, beyond contributions to Social Security funds. Over 65 million Americans rely on Social Security benefits as their primary retirement plan. Another half of American workers plan to supplement their SSA benefits with an employer-based retirement plan.
The most common, the 401(k) plan, provides a retirement safety-net for workers and tax benefits for employers. For every dollar employees defer from their wages into a fund, businesses and workers lower their payroll tax burden. When businesses match employee contributions, any monies paid into the fund are tax deductible. There are even tax incentives available to help businesses get started on a plan in their organization. These plans are a win/win for businesses and workers.
Over 65 million Americans rely on Social Security benefits as their primary retirement plan. Another half of American workers plan to supplement their SSA benefits with an employer-based retirement plan.
Long- and short-term disability insurance, like car insurance, is a plan you hope you never have to use, but are glad it’s there if you do. For many employees, purchasing STD and/or LTD seems like something only workers in hazardous fields should consider. But disability coverage, unlike workers’ compensation, covers illnesses or injuries that happen on the job or off. As one of the lowest-cost benefits an employer can provide, it’s an important perk employees frequently overlook.
Short-term disability insurance can cover minor injuries and shorter health issues, like pregnancy, if the employee is required to shift to take time off work. Whether prompted by an illness or injury, STD coverage generally extends up to 6 months, but in some cases can run for 2 years.
Long-term disability insurance covers major injuries and illnesses. LTD can last more than 2 years and even extend through retirement. This coverage is reserved for significant illness or injuries, and can provide needed funds and peace of mind to staff members and their families.
Plan options vary for long- and short-term disability coverage, and can be tailored to the needs of the employee/employer. Some have specific guidelines and durations, others are more open-ended. With many choices available, it’s easy to find the right coverage for your staff and business.
Many workers assume their contributions to Social Security will be available if they become permanently disabled and can no longer work. But the Social Security Administration outlines it will take at least 6 months before benefits can begin. For some, the approval process for SSA Disability can take years. Having short- or long-term disability coverage can provide workers the safety net they need while waiting for a determination and benefits from the SSA.
How to find the best fit
Finding the best benefit options for staff members — that meet the needs and price point of employers — can be challenging. Focusing on the most important benefit, then finding a provider that offers them in a one-stop-shop can be a best practice for SMBs. For companies looking to attract and retain top talent, these top benefit options may be just the tool you need.