Employee benefits – how important are they?

Benefits are a delicate balancing act for employers, ensuring employee well being versus cost control.

There is a need for businesses to focus on benefits that support a high performance culture as employees who aren’t worried about hospital bills or affording to retire are more focused on their jobs and productive.

Many small business owners mistakenly believe they cannot afford to offer benefits, and perhaps you should value benefits as an investment rather than a cost.

Employee benefits include:

–          pensions

–          life insurance

–          private medical

–          health screening

–          gym membership

–          eye sight testing

–          income protectors

–          critical illness

–          dental plans

–          personal accident insurance.

Soft perks like gym membership are valued least by employees yet employers communicate most about them.  Some commentators state that health benefits are nearly as important as salary in determining staff feelings of loyalty.

An individual is three times more likely to be ill for six months plus, than to die during their working life. So why give critical illness?

So what is the best way to communicate benefits to employees?  Here are some tips:

–          The most common method is via new joiner packs, but this is not always the right timing – on that date they have too many other things to consider

–          Core financial and health benefits are hardly ever discussed and not on a regular basis

–          Have a periodic benefits review

–          Should employees contribute and should the benefits cover the family?

–          You should tell employees what their benefits cost – staff have a mis-conception

–          A workforce of young single people do need life assurance – do a survey to find out what they want, and tailor your package.

–          A big mistake is to exclude some employees, which makes them feel less valued, and creates problems.

Employees look to their work place benefits to help them establish financial security.

So when attracting new starters, don’t tell the applicants that no benefits are offered as this may deter the best candidates.

Implement some basic benefits as a good starting point, because retention of quality staff will be key as the economy improves.

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