As a business owner or senior manager, you know how important the best employees are to your company. Indeed, an employee can bring in new clients or repel them. It’s their efforts and dedication that keep your business growing. If you could, you’d create an employee benefits package that included everything you can think of from healthcare and dental care to extensive vacation days and gym memberships. However, you can’t really afford to do all of that, so you need a more achievable employee benefits package. The following are six steps to design an effective employee benefits package.
Step 1: Discover What You Want to Achieve With Your Benefits Program
Are you using the benefits package to attract new employees, or do you want to help your current employees plan for retirement? It’s essential to know what you want to achieve with your benefits package. This knowledge will guide you in the next steps and help you select the benefits that ultimately end up in the package.
While you don’t need to create a list of specific benefits at this point, you need a list of what you want the benefits to accomplish. At this point, you should be considering the needs of both the company and the employees. You need to consider a variety of factors at this time, such as:
- Your Human Resource strategy
- Number of employees
- Planned future growth
- Labor contracts if there’s a union
- Location(s) of the offices and warehouses
You can write down your objective and use it to guide your next steps.
Step 2: Determine Your Budget for Employee Benefits Package
You can spend a lot of money on employee benefits from healthcare plans and matching retirement funds to wellness programs and paid maternity leave. Before you start choosing benefits, you need to have a dollar figure in mind. It’s possible that you’re already offering some benefits to your employees, such as medical and dental.
You need to start by creating a spreadsheet that outlines all the current costs of benefits. Next, you need to estimate what the future costs of these benefits are going to be because we all know that healthcare, gym memberships, and other types of insurance are all going to be more expensive in a year or two.
If you aren’t currently offering any benefits, it’s a good idea to contact a few companies that offer the benefits you’re interested in and get quotes. You can use this information to create a workable budget.
Step 3: Determine the Needs of Your Employees
You need to make sure that the benefits you offer are ones that the employees want or need. For instance, if you have a young staff, they want more vacation or maternity leave, while an older staff wants a retirement plan.
During this phase, you need to look at what your competition offers its employees. You always need to consider tax laws and regulations concerning the benefits that you might consider.
If you have a current employee benefits package, you need to run the numbers on how many and how much your employees are actually using each benefit. It’s also a good idea to open a discussion with employees about the types of benefits they most want.
Step 4: Create a Tentative Benefits Plan
Now that you know what your employees want, what your competition is offering, and how much of the current benefits package is used, you can create a tentative benefits plan. You need to start with a list of benefits you’re seriously considering and list them by priority.
Once you know your priorities, you need to put a price tag on them. Get quotes and compare the costs of each item to your budget. As you get the pricing you can slide priorities around to get the most benefits for your budget without leaving all the priority items off.
If you already have a benefits plan in place, you might consider eliminating benefits that aren’t as popular. You might consider having employees pay a portion of the benefits, such as insurance, memberships, and other items.
Step 5: Introducing the Employee Benefits Package to Your Employees
You need employee support to make your employee benefits package a success. If you don’t have it, it doesn’t matter how great the benefits are. Hopefully, you asked for employee input into possible benefits. As you introduce the benefits, you need to talk about how the employees’ opinions were incorporated into the decision process and the final selections.
Effectively communicating the new plan is going to have a positive effect on recruitment, retention, and morale. There are bare minimums that you are required to tell your employees about benefits but you can go beyond that and sell the benefits to your staff. You want to build excitement about your new employee benefits package.
It’s a good idea to help employees make the best use possible of the benefits. You need to create a buzz around the new benefits and make sure that your employees understand exactly what they’re getting with the new benefits.
Step 6: Create a Plan to Review the Employee Benefits Package Routinely
No matter how amazing the new employee benefits package is, it isn’t going to be the same one you have a decade from now. Employees go to new companies or have different needs. You need to put a plan in place to routinely review the current package and make changes.
You might be able to find more affordable insurance plans, or one of your benefits may become so expensive that it isn’t sustainable. You need to make sure that it’s still meeting the company’s objectives too.
Every few months or twice a year, you need to review the employee usage of the benefits. It’s also a good idea to explore the current trends in benefit. Don’t be afraid to make adjustments as necessary. If you need any help in crafting an employee benefits package or submitting any tax forms related to it, you should contact the professionals at Silver Tax Group today.