Human resource professionals need to consider company characteristics when offering benefits consultancy to clients.
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Depending on a company’s size, makeup, and market, there are many benefits offerings that you can piece together to create the best package for each one of your clients’ needs.
In this article, we outline how to advise your clients about tailoring employee benefits according to their size, demographic makeup, and market.
Company Size May Cause Disconnect Between Business and Employee Interests
Employee benefits vary depending on the size of the company and number of employees.
According to a recent survey, nearly half (47%) of small businesses provide employees with benefits in 2019.
The most common benefits offered by small businesses are:
- Health
- Retirement
- Family leave
- Paid time off
Businesses that employ 10 people or less are the least likely to provide benefits because their resources are usually dedicated to business growth.
When they do, they’re most likely to provide health and retirement plans.
Small businesses are naturally inclined to want their employees in the office as much as possible: the fewer the number of people you rely on to operate your business, the more impact that results from one person’s absence.
Given the tight labor market, though, employees expect to be offered sick, personal, and vacation days.
HR professionals should consider advising businesses with 10 employees or less to add paid time off (PTO) to their benefits plans.
Ground your advice in employee satisfaction. PTO contributes to employees’ overall well-being and is relatively inexpensive. Employees will generally make up their work when they return from a break.
Flexible work options such as the ability to work remotely or at different times of the day also are highly valued by employees. Remote work is also a low-cost perk, assuming that a business trusts its employees to perform as productively in a remote location as in the office.
Student loan repayments and in-office perks such as snacks and standing desks are also investments to consider for companies of this size.
Businesses with over 50 employees, on the other hand, face much stricter benefits requirements than smaller businesses.
Companies with 50 or more employees are subject to federal labor laws that mandate health coverage and job-protected paid time off for family and medical leave.
- The Affordable Care Act (ACA) requires employers to provide health coverage or pay a penalty.
- The Family and Medical Leave Act (FMLA) requires employers to provide job-protected, unpaid family and medical leave.
Large businesses may need to take additional steps to keep employees engaged and feeling as if they’re a part of a community. One way to accomplish this is by providing in-office perks such as on-premises daycare or fitness facilities.
Make sure you take client size into account and advise small businesses to provide generous packages and larger businesses to add on to their required benefits stipulations.
Benefits Preferences Vary by Employee Age
Employees’ benefits expectations and preferences vary by their age.
Most companies consist of employees across multiple generations. Make sure you review the makeup of a company to create a benefits plan that meets the expectations and preferences of the whole company.
A generational differences study by Paychex found that the benefits employees prefer depend upon their age:
- Baby Boomers favor healthcare-related benefits, bonuses, and 401(k) matching.
- Generation Xers consider salary, advancement, job security, work/life balance, health care, bonuses, and flexible work arrangements as their most-valued benefits.
- Millennials value benefits that affect their quality of life, such as paid time off, flexible work location, flexible scheduling, professional development, and health care and wellness.
- Generation Zs are still entering the workforce. Early studies indicate that Gen Z prioritizes face-to-face communications over remote work and values volunteer opportunities and corporate social responsibility.
Advise clients with broad employee demographic makeups to emphasize flexibility and options in their benefits packages to ensure they can address the needs of all their employees and avoid potentially unpopular mandates.
Market Trends and Competition Set Benefits Standards
As an HR company or professional, you are responsible for reviewing businesses’ competitors to gain a thorough understanding of the benefits standards of an industry or local business community.
Make sure to keep your clients up to date about HR trends and approaches that will help them compete for talent. For example, flexible working is a priority for a majority of workers: 80% of business professionals say they would turn down a job offer that doesn’t offer flexible working.
Almost all employers (85%) say that productivity improves when they provide employees with greater flexibility. Frame the value of maintaining competitive benefits to your clients in terms of money they can save. Specifically, while employee benefits may be costly, failing to offer generous perks may cost even more.
For example, the cost of hiring a bad employee results in costing companies an average of $14,900 to restart the recruitment process and provide training for the new hire.
Researching clients’ market competition and offering a competitive benefits package can ultimately save money and retain the best staff possible.
Tailor Benefits to Company Characteristics
Businesses should pay attention to the recent trends in recruitment and employment to learn what’s necessary to recruit and retain valuable employees.
Most importantly, small businesses must remember to offer the benefits job candidates and employees are likely to appreciate. With comprehensive and applicable benefits policies, businesses will be able to recruit and retain top talent.
Seamus Roddy is a Content Writer for Clutch, a B2B research, ratings, and reviews company. He helps support HR companies and their clients through his research and writing efforts.