Empowering Your Team: Using a Strong Employee Compensation Package as a Retention Tool
Metlife’s 2022 Employee Benefits Trends Study has delivered a crystal-clear message: benefits are more crucial than ever for employees.
In particular, mental and social health benefits have become extremely important. Employees now look to their employers for increased support in these areas.
But why are we witnessing this huge shift in employee demand for these benefits?
Before COVID-19, baby boomers made up a significant portion of the workforce. But times have changed. Generation Z has entered the workplace, injecting fresh perspectives and energy into the scene.
But it’s not only about the workforce; the rules of engagement have also shifted. Recent laws now emphasize mental health, gender-neutral treatment, and equal respect for various orientations.
This shift reminds us of the pressing need to foster workplace fairness, inclusivity, and kindness.
In this blog, we’ll explore how your small business can manage employee benefits, how compensation aids retention, and how to choose optimal insurance options as a part of your compensation strategy.
Navigating employee benefits in small businesses
As you know, small business owners often lead a diverse workforce, each with unique needs and backgrounds. This can make navigating employee benefits a challenge.
Let’s simplify and outline the key types of employee benefits vital for small businesses:
Mandatory benefits
Certain benefits are obligatory, including Social Security, Medicare, unemployment insurance, workers’ compensation, overtime pay, minimum wage requirements, and jury duty leave.
In addition, according to the US Bureau of Labor Statistics, mandatory compensation includes Coronavirus leave.
Voluntary benefits
You can offer voluntary benefits to improve employee satisfaction and retention. These may include paid holidays, vacation time, health, vision, disability, dental, life insurance, and retirement plans.
Expanding fringe benefits
Many modern employers are extending fringe benefits beyond the basics. These could include gym memberships, remote work options, flexible schedules, daycare facilities, tuition assistance, student loan repayment, employee assistance programs, and more.
Tailored compensation benefits
Compensation packages can be customized to suit individual needs and preferences. This way, you can accommodate the diverse needs for different types of compensation in a multi-generational workforce.
How you can use compensation as a retention tool
Let’s explore how your employee compensation packages can play a vital role in making your team want to stay and grow with your company.
- Competitive salary: Make sure that your organization offers competitive salaries aligned with industry standards. Regularly review and adjust salaries to match market rates.
- Rewards for good work: Give extra rewards to employees who do their job exceptionally well. It shows you appreciate their efforts, encouraging them to remain at your company and continue to work hard in their roles.
- Opportunities to advance: Offer chances for employees to get promoted, receive a raise, or take on more responsibilities. Workers are more likely to stick around when they know career growth opportunities are available.
- Comprehensive benefits: Provide complete benefits packages, including health insurance, retirement plans, paid time off, and other perks. When employees feel cared for, their gratitude will be reflected in their loyalty to your organization.
- Flexible work options: Allow flexible work hours or the opportunity to work from home. This helps employees balance work and personal life and shows that you value their well-being.
- Open communication: Make sure that employees understand the various components of their compensation, including salaries, bonuses, benefits, and other perks.
- Skills advancements: Offer training programs and educational support to demonstrate your commitment to your employees’ skills development, encouraging them to stay and advance their careers at your company.
- Employee wellness initiatives: Promote employee wellness by offering wellness programs, mental health support, and stress management resources.
- Listen to feedback: Listen to your staff’s concerns and suggestions, and act to improve things. Employees who know that their feedback matters feel more invested in the company.
How to optimize your employee insurance benefits
Insurance is a fundamental part of employee compensation and retention strategies.
Including a robust insurance package in your employee compensation shows your commitment to employee well-being and enhances job satisfaction and loyalty.
Choosing the best insurance for your team can be made simpler and more effective by following these steps:
Understand employee preferences
Begin by gathering your staff’s input to understand what coverage and types of compensation they value the most.
Evaluate costs
Estimate the expenses associated with the plan, considering contributions from both you and your employees. This ensures the plan remains affordable and beneficial.
Check network coverage
Confirm that the insurance plan includes the healthcare providers that your employees commonly use. This guarantees convenient access to necessary medical services.
Assess customer service
Evaluate the level of customer service and support offered by the insurance carrier. A carrier that provides excellent service ensures a smoother experience for you and your employees.
Review policy flexibility
Make sure the insurance policy allows for adjustments and modifications to account for changing employee needs or company circumstances.
Analyze exclusions and limitations
Learn about any exclusions or limitations within the policy to prevent unexpected gaps in coverage.
Consider employee education and support
Plan for effective employee education regarding the chosen coverage and competitive employee compensation options. Provide ongoing support to address queries or concerns as they come up.
Evaluate wellness programs
Find out if the insurance plan offers wellness programs encouraging employee health, which could potentially reduce long-term healthcare costs.
Anticipate future needs
Select coverage options that can adapt to and accommodate changes in your workforce’s size, demographics, or health needs.
Key takeaway
In a post-pandemic world, employee benefits matter more than ever. Gen-Z joining the workforce and changing societal norms highlight the fact that businesses need a competitive compensation package.
A good compensation package – including competitive salaries, rewards for excellent work, growth opportunities, comprehensive benefits, flexible work options, and more – is a powerful tool to retain your staff and nurture their well-being.
Additionally, insurance is a vital part of this compensation mix and not just in terms of financial protection. It represents security and care. Tailoring the right insurance package adds to employee satisfaction and reinforces loyalty.
Develop an employee retention strategy with Deliver Workforce Solutions
If you need further assistance with your retention strategy, Deliver Workforce Solutions would love to help.
We offer an integrated set of programs and strategies designed to help you attract, develop, and retain your employees
To book your free consultation, please get in touch with [email protected]
