Employers who consider voluntary benefits for their workers are a step ahead of those who do not.
When employees interview for jobs, one key question they ask in the process is about what options are available for a benefits plan. Most organizations offer some type of additional services beyond the basic health care plan, but there are many businesses that do not.
Shame on you if you are one of those! Your most valuable resource as a business owner or CEO is not the cash in the corporate checking account or the amount of goods stacked in your warehouse. It’s your people who show up every day and punch a clock to work for you. You’d better treat them with respect.
One of the best ways to show that you care about your employees is to offer a generous menu of voluntary benefits. According to Insurance & Financial Advisor, employers are offering voluntary benefits more to benefit their employees than to cut costs, according to new research. “Gauging the Success of Voluntary Benefits,” the second in a series of research briefs stemming from Prudential’s Sixth Annual Study of Employee Benefits: Today & Beyond, found that 75% of employers say their top reason for offering voluntary benefits is to expand the benefits options available to their employees, with 42% offering voluntary benefits to fulfill an employee need, and 30% offering them at their employees’ request.
Exactly 85% of employers say they offer one or more voluntary benefits including life insurance (63%), disability insurance (56%), and dental insurance (52%). Ranking lower on their priority list were critical illness insurance (35%) and long-term care insurance (33%). Voluntary benefits have great value for both employers and employees. Unlike traditional health insurance paid for entirely or in part by employers, voluntary benefits typically are a cost-effective option for employers to provide. Convenience is the most common advantage and driving factor in purchasing voluntary benefits because workers pay for them through payroll deduction.
Per Employee Benefit News, it's no surprise that having a well-rounded compensation plan in place is key for employers looking to amp up their workforce. As such, offering medical insurance benefits and paid time-off is often simply not enough. The Benefits USA 2011/2012 survey results found employers are offering a myriad of benefits to keep their employees happy.
Life insurance coverage is also a common offering made by companies to their employees. Nearly 98% of employers offer basic life insurance. Seventy percent use multiples of an employee's pay to determine the maximum death benefit beneficiaries will receive. More than 43% of the companies using this method set the death benefit at one full year of an employee's pay, while 30.5% set the benefit at two year's pay.
Many companies were forced to scale back their total compensation packages during the height of the recession, and benefits were not spared those cutbacks, according to Compdata Surveys. Now, as companies are looking to expand their workforce again, they realize the need to offer a wide range of benefits in order to remain competitive in attracting and retaining top talent.
Only 25.8% of employers report offering elder care benefits to employees. These benefits include flexible schedules, long-term care insurance discounts and referral services, among others. However, a study conducted in June by the MetLife Mature Market Institute found the number of adult children caring for aging parents has tripled over the last 15 years, and providing care has cost these caregivers an estimated $3 trillion in lost wages, pension and Social Security benefits. As the aging population continues to increase, it may become important for employers to evaluate their benefit packages to include this growing class of dependents.
According to Colonial Life, increasing premiums, co-pays or deductibles have been popular among employers, but many are hesitant to do so because of "the negative impact on employees, and raising premiums could disqualify an employer from other benefits granted under the healthcare reform law passed last year." Another means of reducing costs is instituting wellness programs. This enthusiasm is not misplaced. Every dollar spent by a large employer on wellness programs would return $3.27 in savings. Tripling your investment returns is a good thing.
Voluntary benefits, including any wellness options, offer great opportunities for companies to reduce the “fat” in their overall health care expenses, increase the employee retention rate, provide incentive for new hires to come on board, and show that they care about the health and wellness of workers. Improving the profitability of your business while keeping people happy and well should be a priority. Sounds like a winning combination for everyone. After all, who wouldn’t want to work for an organization that offers a buffet of choices to be healthy?