What kinds of employee benefits are most valued by employees today? Quality compensation packages are essential to an organization's success, given the competitive nature of the labour market today.
Offering employee benefits can quickly become pricey. It can be difficult, especially for smaller businesses, to put together an employee benefits package that is truly competitive and enticing. The objective is to maintain market competitiveness while providing benefits that do not increase the organization's costs.
What are employee benefits?
The numerous forms of non-wage remuneration that firms offer their staff in addition to their regular pay or salary alternatives are known as employee benefits. These are frequently a part of job offers and can be utilized to draw in and keep top personnel.
What are the benefits of offering employee benefits
Providing your personnel with an employee benefits package is a terrific way to engage and motivate them and give them something special in exchange for the hard work they do for your company.
There are many numerous benefits to offering employees a good employee benefits package. Below are five reasons why you might want to consider offering employee benefits:
1. Attract and keep top talent
Having a benefits package gives companies a competitive advantage when hiring. By demonstrating your dedication to taking care of your team by providing them with an improved remuneration package, you are more likely to attract higher quality, motivated, and dedicated employees.
Many workers seek a decent employee benefits package when thinking about changing jobs. When applying for a new position, candidates will consider employee perks.For an organization to be competitive in hiring, it has to offer employee benefits.
2. Minimize employee turnaround
As mentioned above, good benefits keep employees from being swayed by other job offers. Benefits give employees a sense of security and stability in the business. This results in lower employee turnover. Because you won't need to hire or train new employees as frequently, you can save money in those areas.
3. Better worker morale
When employees feel that the employer cares about their health and wellbeing, they are more likely to respond in kind. When employees feel that their employer cares, they are more likely to be loyal to the employer.
4. Maintain a fit workforce
Employee benefits can give your team the tools they need to stay healthy and productive, benefiting your business and its workers. Similar principles apply to paid sick leave, for example. You may prevent your entire team from becoming sick by encouraging employees to stay at home when they're unwell.
11 Employee benefits every employee should have
1. Medical insurance
The standard foundation benefit for the framework of many businesses is now health insurance provided by the employer. One of the simplest yet most effective actions you can take to reward and attract talent is to offer health insurance as an employee benefit. Businesses wishing to provide medical insurance to employees have a wide number of alternatives, but generally, group health benefits take the following forms:
Basic health benefits include coverage for pre-existing conditions, dependents, international and regional travel, outpatient and inpatient care, and dependent coverage.
Maternity and fertility coverage, vision, and dental insurance are common extra perks.
Extended/all-inclusive benefits include vaccines, general wellbeing, and assistance with mental health.
The basic goal of an employee medical insurance program is to safeguard and promote employees' health and wellness so they may continue to contribute actively to the business.
Why is medical insurance so popular as an employee benefit?
Healthcare is very expensive. According to Center for Medicare & Medicaid Services, U.S. health care spending grew 9.7 percent in 2020, reaching $4.1 trillion or $12,530 per person. The Internation Finance Corporation estimates that over the next decade, $25 to $30 billion in new investment will be needed to meet Africa's health care demand. It is the same throughout the world. Countries find it difficult to keep expenses low while raising quality.
According to a clutch survey, health insurance is the most significant benefit in terms of job happiness, according to more than half 55% of employees. So it should be no surprise that having access to health insurance through a company is highly prized by employees.
2. Life insurance
Don't ignore a vital benefit that is well-liked by employees and comparatively simple to administer if you've been considering strategies to increase employee wellbeing at your company: life insurance. Giving your staff safety nets like this can promote mental health, ease stress, and enhance attention at work.
Life insurance allows you to leave money to selected beneficiaries in the event of the insured's death. The most prevalent life insurance offered by businesses to their workers is group life insurance. Group life insurance provides coverage for a number of your employees through an agreement between your organization and the insurance provider.
Policies for life insurance are typically affordable and simple for companies. Because group life insurance is less risky for the insurance company, group life insurance premiums are significantly lower than premiums for individual life insurance plans. Group life insurance premiums are set by insurance firms based on the group's or company's overall risk, which is typically minimal.
Life insurance is one of the major advantages employees seek when they hunt for a job. If an employee has a family or children, good life insurance coverage might be quite important to them. Offering even a modest coverage will help distinguish you as an employer of choice for potential candidates.
When a reliable life insurance policy protects an employee, they know that their beneficiaries will be paid in full in the event of an unexpected incident. The money can be used anyway their loved ones think fit, including replacing lost income, paying for necessities of life, paying off personal debts and burial costs, supporting a child's education and enhancing retirement funds.
3. Retirement plans
A fantastic method to improve the benefits component of your compensation package is to offer retirement benefits. Retirement plans are a priceless perk that affects employees' life now and in the future. Through programs established at work, employees are encouraged to save for retirement. Offering a retirement plan as an employee benefit enables you to benefit from the plan for yourself, which is crucial for small business owners.
Some benefits of providing retirement benefits include the following:
- Because Congress wants to encourage firms to offer retirement benefits to employees, you can gain some major tax advantages for your company.
- Employee motivation and productivity may increase under a plan that is profit-based.
- You may have a recruiting advantage if you have retirement benefits.
- You can use a retirement plan to enhance your salary if your company has high start-up costs or little cash.
4. Paid sick leaves
Sick days are a benefit many organizations that do not currently provide may be reluctant to introduce. Companies that do not currently offer sick days may be reluctant to adopt them as a benefit out of concern that employees will abuse them or that the choice will increase costs. There are numerous legitimate benefits to offering sick days that may outweigh these potential downsides.
Some of the advantages of providing paid sick leave are:
- Healthier employees - Naturally, providing sick days to workers is to encourage them to stay at home when ill. This is a significant advantage in and of itself because illnesses will be less likely to spread throughout the company and harm numerous personnel. Additionally, when allowed to rest, workers can recover from diseases more quickly, improving their general health.
- Higher productivity - When they are sick, workers typically produce less. A corporation's production may decrease when illnesses spread throughout and affect numerous staff. Whether the time off is paid or not, employees may eventually be required to take days off to recover from illnesses or injuries, which can hurt productivity.
- Decreased Employee Turnover - Paid sick days do not necessarily prevent people from leaving their jobs. When paid sick leave benefits are introduced, missed work regulations are likely to be changed as well, making it less likely that workers would be fired for being absent from the office due to a valid sickness.
- Societal Impact - Culture can change if people are allowed to use sick days without worrying about losing their jobs. The notion that one has a right to care for one's health becomes commonplace when employees may call in sick without worrying about losing pay or their jobs.
5. Performance-related recognition
Companies utilize bonuses and stipends as incentives to motivate, honour, and acknowledge their staff members who perform above and beyond expectations. These are typically presented as cash or gifts with no monetary value.
A performance-based bonus is an additional payment made to an employee for exceeding previously set benchmarks and targets. After reviewing exceptional projects or high-caliber work performances, employers frequently reward employees with performance incentives.
Employees can be encouraged to produce high-quality work, meet objectives, and stay motivated and productive with the help of a well-designed performance bonus system based on fair criteria.
There are numerous reasons why your employees need to get bonuses and stipends like a career development stipend, even though they may appear to be an additional cost to your company. Here are a few of those explanations:
- Improve Productivity - A rise in productivity is linked to stipends and bonuses, which motivate staff to streamline operations, be more productive, and eliminate waste.
- Boost Profitability - Stipends and bonuses for your staff are necessary because they can assist grow your company through stronger profitability, a higher return on investment, and a better return on equity. The idea behind incentives and stipends isn't only to grow your firm; it's also to give employees a stake in the gains and encourage them to care more about the state of the organization as a whole.
- Keep Top Talent and Attract It - Finding abilities is difficult, and keeping some of them is much harder. This is only one of the good reasons always to remember to give your staff rewards. Structured bonuses and stipends with clear performance and compensation goals can keep your company competitive in the market and help you hang onto your best employees for a very long time.
- Recruitment Benefits - Bonuses and stipends that are alluring to employees are more likely to make them feel valued and loyal to your business. Loyal workers are typically less likely and content to hunt for certain employment options, helping to lower your recruitment costs and save time.
6. Wellness programs
Holistic wellbeing is addressed and promoted by effective wellness programs. Employers can improve employees' health and assist specific employees in overcoming specific health-related issues by implementing employee wellness programs. The employer may require employees to complete training, hold staff meetings, or even partner with a third party offering a range of wellness initiatives.
Benefits of Employee Wellness Programs
Healthy employees bring a variety of benefits to other employees as well as to the companies they work for, even though the benefits of an employee wellness program may be difficult to notice at first
- More productivity - Healthy eating and regular exercise are likely to increase an employee's productivity.
- Improve recruitment and retention of employees - The best employees will be easier to find and keep for businesses with effective wellness initiatives.
- Reduced absenteeism - Due to healthier and less stressed employees, workplaces with comprehensive wellness programs see lower absenteeism, which reduces costs.
- Reduced health risks - Lowering health risks involves assisting staff members in acquiring healthy habits such a balanced diet, regular exercise, and quitting tobacco.
7. Employee training
Programs for employee growth and development are crucial to the success of businesses all over the world. These programs not only give employees the chance to sharpen their abilities but also give companies the chance to boost employee productivity and promote workplace culture.
The ongoing endeavour to improve employee performance through methods including coaching, training sessions, and leadership mentoring is known as employee development. Training is a specific activity that imparts new knowledge or abilities, frequently given to freshly hired or promoted staff.
Why is employee training important?
- Enhance employee performance - Programs for employee development and training are essential for boosting productivity. In fact, according to a 2019 study published in The International Journal of Business and Management Research, 90% of the workers polled agreed or strongly agreed that participation in training and development programs increased their performance at work.
- Boost employee productivity - Participating in good training and development programs helps employees do their jobs more effectively.
- Reducing employee turnover - Reducing staff turnover requires investment in training and development. A 2019 survey conducted by the educational technology company Instructure revealed that 70% of American workers said they are at least somewhat inclined to quit their present job and accept a new position with a company that prioritizes training and development.
Companies can provide various chances for employees to receive training and development either in person or online. And they can offer such chances through internal training, external training, or off-site activities. Employees can frequently choose from the following kinds of training and development:
New employee training
Mentoring programs Apprenticeships
8. Paid time off
Paid time off is advantageous to you as an employer and to your employees' physical and emotional wellbeing, both at home and at work. Offering enough paid time off to meet personal and family commitments while keeping your firm profitable helps maintain the balance between your employees' physical and emotional health and wellbeing.
Why paid vacation leave is important?
Employees' physical and emotional health, attitudes toward their jobs, and productivity all benefit the firm when you provide them paid time off PTO. Your team will benefit from a welcome break from the daily grind when they disconnect from work, especially if they have a demanding or stressful job. This will give them time to rest, unwind, and reenergize. And when they come back, they'll probably be more productive, in tune with their coworkers and managers, and have a fresh perspective on a project.
Overworked and stressed-out employees eventually burn out. Their output declines, and they could become disinterested in or unpassionate in their work. Numerous negative consequences may result from this, such as missed work due to illness, decreased productivity, and a lack of creativity and innovation. Your company may lose a lot of money if you don't offer paid time off or if employees don't take advantage of it.
9. Disability insurance
An entire employee benefits plan must include the management of employee disability benefits.
A wide definition of disability benefits is an employee benefit that offers job security and income replacement to workers who cannot work due to illness or injury. Both temporary and permanent disabilities are possible.
Types of disability benefits
Disability benefits include a wide range of different benefits. The most typical types of disability insurance are short- and long-term; however, long-term care, workers' compensation, and paid leave programs can also offer benefits to employees in the event of an illness or injury.
Short-term disability insurance
Injuries or situations that could prevent an employee from working for a few weeks to a few months are covered by short-term disability insurance. A broken limb, an outpatient procedure requiring recuperation time, or occasionally even pregnancy or maternity leave are examples of circumstances that could be covered under short-term disability.
Long-term disability insurance
Employees will start drawing benefits from a long-term disability insurance plan if they suffer an ailment or event that limits their possibilities for short-term incapacity. Three to six months is typically the time range for this.
Cancer, mental disease, or physical conditions requiring many surgeries are examples of conditions that could qualify as long-term disabilities.
10. Tuition reimbursement
Employers provide their staff tuition reimbursement, which covers the cost of any college courses they take while they work for the company. Normally, employees pay for their education, and after completing the courses, the employer picks up the tab. The company's budget and policy will determine how much the employer chooses to pay. Some businesses may cover tuition and extra costs like books, pens, pencils, and paper as well as a laptop for school.
Some employers opt to offer tuition reimbursement under specific circumstances. Typical prerequisites that workers would need to fulfill include:
- pursuing a particular course of study
- The cost of the courses
- obtaining a certain grade
Why tuition reimbursement is important?
Employees who aren't struggling financially are less inclined to quit their jobs in search of ones that will pay them more. Additionally, workers who continue their education will gain new knowledge and contribute more to their current position. An investment in the education and future of your staff is an investment in your business.
11. Telecommuting and work from home options
Remote work had a breakthrough when COVID 19 required businesses worldwide to send their staff home to work virtually.
For many firms, it came as a rush to provide workers with all the equipment they'd need to work from home. However, once everyone had settled in, it soon became clear to many office-based teams that workers could be equally or even more productive and focused outside the workplace. Employers all across the world started to realize that remote work is effective.
Benefits of remote work
Reduced stress levels
Because so many employees spend so much time together, it is difficult to ignore the continual talk and updates about what is happening around us. Consequently, employees find it difficult to unwind, increasing their anxiety and concern levels.
Companies can lessen the risk of a virus spreading through community transmission and the stress, anxiety, and fear that workers can experience by allowing them to work from home.
Organizations often ensure a decent work-life balance for their workers by allowing them to work from home. They can set up their working day any way they see fit, as long as they follow a few fundamental guidelines. All workers in an office setting must adjust to the same circumstances. They have greater power when working from home because they can decide when the time of day they want to work (early in the morning or late in the evening). They can work more effectively than when they would typically be in the workplace.
Working from home is no longer a barrier to completing everyday duties, thanks to the development of technology in the current world. Regular meetings can be held as usual through online video conferencing, and team projects and cooperation can be shared and accessed online thanks to various cutting-edge platforms.
Ngonidzashe Nzenze is the Business Systems Software Developer at Industrial Psychology Consultants (Pvt) Ltd, a management and human resources consulting firm.
Phone: +263 242 481946-48/481950
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