Long before I started Workplace Benefits Solutions I remember having a conversation with my Dad about the employee benefits he offer his 25 employees. He was a reluctant buyer and I remember him telling me to the cent how much this added to his hourly labor costs. I haven’t forgotten that conversation, but there were a few things that Dad didn’t consider about his benefits package.
These are a few things that need to be considered:
1. Talent attraction/ retention
There was a time before ACA, which I believed benefits really didn’t help with retention or at least it was overstated. Now in a tight labor market your benefit package can attract new employees. But, on the other side competitors are good employees and a strong benefits package offering can make a difference.
2. Employee can be proactive about their health
Productivity is a big deal! The most valuable ability of an employee is availability.
3. Employee Satisfaction
Not all benefit packages are the same. I had one person tell their HR Director… “Now I finally have benefits that are actual a benefit for my family.” That is a satisfied employee!
4. Benefits are an effective use of resources
Research says it costs an average of 25% of person’s salary to replace them. So, to replace a $40,000 employee is about $10,000 in training, loss of productivity and the down time while finding their replacement. If you look at the costs of a good benefits package it is not close to $10,000.
5. Having a long-term strategy.
Be strategic when buying benefits, but not stingy. Work with a broker who tries to maximize your dollars. A benefit plan that is too skinny can cost in the other areas we discussed. WBS helps our clients have a rolling 3-5 year strategy.
If you want our help let us know. helpwithmybenefits.com