Employee benefits is an integral part of an organization. Without it, no company can survive for long or at all. If you have astounding employees, you’re gonna want to keep them. One way of doing this is through employee benefits.
There are different kinds of employee benefits. Benefits being offered by employers could depend on the type of job, location and more. For example, employee benefits for those with a full-time job are different compared to individuals who work part-time.
There are also laws that require employers to offer their employees certain benefits. These benefits can differ as laws can be different with each state in the United States. However, here are basic laws that all employers are required to follow according to Virgin Pulse:
- Giving employees time off to vote, serve on a jury and perform military service.
- Comply with all workers’ compensation requirements.
- Pay state and federal unemployment taxes.
- Contribute to state short-term disability programs in states where such programs exist.
- Comply with the Federal Family and Medical Leave (FMLA).
These are benefits employers are not required to provide:
- Retirement plans
- Health plans (except in Hawaii)
- Dental or vision plans
- Life insurance plans
- Paid vacations, holidays or sick leave
While the second list entails employee benefits employers are not required to offer, a lot of companies still offer these benefits and more to have a competitive edge. This is because the importance of employee benefits is paramount to the success of an organization.
While having this practice may seem expensive, and it is, you’ll be surprised how having competitive benefits are allowing big companies to have better sales and performance. Moreover, research has also shown that employees value benefits over money.
Here are statistics to prove this point:
- According to the American Institute of CPA, 80% of employees would rather keep a job with employee benefits than to leave for a higher paying job but has no benefits.
- A study from WTW showed that 78% of workers said they would rather stay with their employers because of the employee benefits offered by their companies.
- According to Zenefits, more than 60% of employees would accept a job with inferior pay for better employee benefits.
According to the Patriot Software, employee benefits affect these four key areas of an organization:
- Employee loyalty
- Focus and productivity
Employee benefits affect loyalty as benefit packages impact the current quality of life and the future of employees. Benefits allow employees to trust their employers better because employee benefits is one way of showing care for the workers.
More than the fierce competition in doing business providing goods and services, there’s also a fierce competition in HR with relation to employee benefits. In business, you’ll need employees to run the operations.
To attract and keep employees, companies offer competitive employee benefits. This is why companies like Netflix, Salesforce, Google, Facebook and other large companies have such generous employee benefits.
A lot of studies have proven how employee benefits impact employee loyalty. Here are findings from MetLife’s 15th Annual U.S. Employee Benefit Trends Study:
- 72% of employees agree that the ability to customize benefits improves their loyalty.
- 68% agree that the ability to take benefits with them boosts loyalty.
- 59% agree that health and holistic benefits improves loyalty.
Moreover, according to an American human resource consulting firm, Robert Half, 38 percent of employees leave their jobs because of “inadequate salary and benefits.”
This means that having the right employee benefits can allow you to retain your employees while having not enough can put you at risk of them leaving their jobs.
Focus and Productivity
Employee benefits affect company culture which has an impact on focus and productivity. According to Business2Community, organizations that have high employee engagement outperform those with low employee engagement by as much as 202%.
With the right benefits, employees can also feel more financially secured. When employees are less concerned about money, they can focus better on work and their productivity.
With employee benefits, absenteeism can be reduced in a significant manner. The three major causes of absenteeism are:
- Family commitments
- Health issues
With benefits that can help resolve these issues, employees will show up more at work.
As mentioned earlier, employee benefits are also used in recruitment to attract and keep workers. With competitive employee benefits, you can hire and keep skilled individuals that are key to your organization’s success.
According to a survey from Glassdoor, 57% of candidates believe that benefits are their top considerations in accepting the job. Moreover, employee benefits is also linked to employee happiness, satisfaction, engagement and more.
If you’re wanting to start a business or if you have one and you are unsure about employee benefits, you can check what benefits other businesses in your industry are offering. This can give you a brief idea on what to choose and offer.
Now that you know the basics and importance of employee benefits, you know have a better idea on how to boost the retention, engagement, productivity and sales of an organization. Remember, work now isn’t what it used to be.
Personal satisfaction now can be as important as the digits on the paycheck. Care for your employees through giving them proper employee benefits. As what Richard Branson said,
“Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients.” Take care of your employees and they will take care of your clients.