Employee benefits packages are powerful recruitment and retention tools – and for many employers, they’re essential for Affordable Care Act (ACA) compliance. That said, great benefits often come with a hefty price tag, accounting for as much as one-third of payroll costs, plus the time and labor to administer them.
What’s the solution? How can you offer a killer benefits package on a budget?
While it’s definitely a balancing act, it is possible to put together a competitive benefits package that will attract quality employees and give them the benefits options they want – all without substantially increasing your payroll costs. Below are three considerations to keep in mind as you search for the perfect cost/benefit mix:
1. Customize your offering to suit your unique mix of employees. When you’re ready to put it all together, take time to do some strategizing. Some things you’ll need to consider:
- What’s the makeup of your employee base?
- What do the sectors within your team care about?
- What benefits will best attract and retain the kind of employees you need to carry out your company’s business strategy?
- What benefits can you afford?
2. Diversity and flexibility are key. One-size-fits-all benefits packages are a thing of the past. These days, your employee base might include singles, families, and employees of widely varying ages. And those employees increasingly want options and the ability to choose the benefits that fit their life stage and their lifestyles. You can set a specific budget for benefits for each of your employees and let them pick and choose the benefits that meet their specific needs. For example, an employee with children whose spouse has a good health plan might not want duplicate coverage and prefer to take the equivalent value in childcare assistance.
3. Give them a total experience. Don’t forget – a killer benefits package includes more than just insurance products. When you provide more options, employee satisfaction tends to rise because employees have the flexibility to pick and choose exactly what appeals to them. Some other options you should consider include:
- Employee education and communication initiatives
- Financial planning assistance
- Guarantee issue for benefits such as life and disability
- Payroll deductions for ease of payment
- Child care and medical expense reimbursement
- Disability and long-term care insurance
- Tax advantage premium payment
- Parking or public transportation passes
Sometimes inexpensive add-ons can make a big difference for your employees. For example, a simple plan offering child care and medical expense reimbursement involves low administrative costs and no employer contributions, while saving employment taxes for both the employee and employer, and income taxes for the employer.
Another example is a disability insurance benefit plan. The employer decides who receives the benefit and at what level, the employee gets valuable disability coverage at little or no cost, there are no government reporting costs, and it’s a tax deduction for the business owner. That’s hard to beat.
Ready to start building your killer plan on a budget?
Contact the experts at BeaconPath. And for more on employee benefits planning with a modern twist, be sure to check out the video below.