Why A Great Benefits Package is Great for Business
It’s no secret to business owners that finding the right people for the right positions can be a challenge. But finding those people and putting them in place is only part of the battle. What about keeping them?
In pursuing my CFP® designation, one of the best pieces of information I learned was in the employee benefits lesson at Bryant University. While often redundant, hearing the obvious from a different perspective can change the way we approach problems by causing us to think about it a different way. In this case, it was the “four R’s” of employee benefits.
What are they?
Recruit. You want the right people for your job. The criteria may be someone with sales experience, with a glowing, outgoing personality, or with organizational skills. The truth is, the best person for the role will be highly sought after. Something as simple as a retirement plan with company match may compel them to look at your job listing. Or, why would an employee choose your competitor when they can get a subsidized health insurance plan from you? (Yes, health insurance is expensive, but that doesn’t mean you have to pay for the whole thing.) The right benefits package should be attractive enough to appeal to the people you want.
Retain. Why hire them if you don’t want to keep them? (Nevermind temporary and seasonal positions, of course.) According to Gallup, only 3 in 10 millennials are emotionally engaged in their jobs*. On top of that, 60% of them are open to new job opportunities. Benefits are only part of retaining them – but a great culture can only go so far. You have to show them the matter to you. Consider having a 401(k) with a cliff vesting schedule – in other words, the longer they stay, the more of their match they keep. Employee Stock Ownership Plans may make sense to give your employees a sense of ownership – literally – over their roles. Don’t forget about the obvious, such as bonuses, anniversary gifts, and paid vacation days. The more good things on the horizon, the more likely they are to stick around.
Reward. They key to a good reward is that it must be sincere. “The difference between appreciation and flattery? That is simple. One is sincere and the other insincere,” says Dale Carnegie, author of How to Win Friends and Influence People. “One comes from the heart out; the other from the teeth out. One is unselfish; the other selfish. One is universally admired; the other universally condemned.” By genuinely showing our appreciation for our employees, we can command loyalty that our competitors cannot. So, after a grueling week of long hours to meet deadlines – treat them to lunch. Let them leave early. Take them out for drinks. If they’re tired, let them take a nap. Be creative. Think of them as people, not as machines. They’ll link that emotional positivity to being a part of your company.
Retire. It’s no surprise that retirement benefits are on the decline. These days, you’ll find very few companies offering pension plans – the types of plans that promise to pay a person for life after they retire. Many have been substituted (if employees are lucky enough) for defined contribution plans – like the 401(k) – but, many employees don’t even contribute. Part of retiring your employees is being sure you do your part to get them in that direction. Start by offering a great financial education. Help them understand the importance of saving. Invest in a plan with a company match to encourage saving. By investing in a great retirement package, you are showing your employees you want to keep them for life. That upfront cost is well worth it, if you can offset the very high cost of employee turnover.
When considering developing benefits package, many employers struggle with what specific benefits they should offer. The truth is that what benefits they offer don’t matter as long as they fit meet the criteria above. One thing is for sure – there’s no such thing as too many. Don’t forget the four R’s of employee benefits – unless you want your employees to forget you.
I’d love to hear from you: What types of benefits are you considering implementing for your work place? What types of benefits are you happy to have? Comment below!
About the Author:
Scot Whiskeyman is the founder of Providers & Families Wealth Management, LLC, a full-service financial planning and wealth management firm based out of Lemoyne, PA.