As any employee knows, there’s more to hope for at a job than just the salary. One of the biggest factors of whether or not someone will accept an offer is the benefits package. These are the things that help them feel supported in ways beyond their paychecks, and they can have a huge impact on employee experience.
Employee experience (EX) is a growing focus of Human Resources teams that aims to attract and retain talent by making your business a great place to work. And while the benefits package is not the only component of an EX program — EX also covers the messaging and technologies used to help employees interface with HR processes — it goes a long way towards employee satisfaction, so it’s important to know what kinds of financial services to offer.
The first step in configuring a benefits package is to understand your workforce but put together a set of employee personas. Different cohorts care about different things, so creating groups of like-minded people is a good way to present options that allow everyone to get what matters to them.
For example, younger employees might have a high student debt burden, and low-wage earners might struggle to contribute funds to retirement accounts. Benefits that are aligned with the needs of those groups are more likely to attract and retain talent within those demographics. For them, a 401(k) may not be particularly helpful, whereas full health care coverage, a continuing education stipend, or a bonus program can make a real impact on their lives.
Businesses should have a clear sense of who their employees are so they can give them the best employee experience possible. From there, you can tailor your benefits packages to offer the things that are most appealing to every employee, including:
- Financial services
- Stock options
- Retirement plans
- Health insurance
- Health Savings Accounts (HSAs)
- Flexible Spending Accounts (FSAs)
- Supplemental insurance
- Tuition assistance or reimbursement
- Continuing education stipends
Offering Financial Services
One of the foundational benefits a company can offer its employees is financial services. These can take a variety of forms. New financial technologies (FinTech) emerge every year, and with the advent of things like peer-to-peer payment methods, the ways in which people use their money are increasingly dynamic.
Integrating with platforms like Gusto (which untethers income from the traditional two-week pay period) or Gradifi (which allows employers to administer student loan payments) empowers employees to direct their resources in the way that works best for them.
Administering these kinds of services on behalf of your employees takes a huge burden off their shoulders.
Stock Options and Retirement Plans
On the more traditional side are stock options and retirement plans, both of which have an array of products to choose from. Stock options are a great way to encourage an employee’s best performance by giving them an ownership stake in the company that may become quite valuable in the future. Retirement plans like a 401(k) or a Roth IRA provide employees with steady and conservative investments into their post-employment years. Employers can match contributions (which are tax-deductible) to encourage employees to take advantage of those benefits.
It is important to remember that not everyone will consider these benefits to be helpful. Stock options often have a short expiry period and require employees to purchase them from the company, which is not always feasible. And, as mentioned, retirement accounts are only as useful as one’s ability to contribute to them.
Stock options and retirement plans are best for employees with at least medium levels of income or with healthy savings at their disposal.
Life can take unexpected twists and turns. To mitigate some of that damage, employees offer different types of insurance plans and investment vehicles that help employees stay afloat when times are tough. Investments in these benefits show employees that you are committed to supporting them not just in their work, but also in their lives.
As the only major country in the world with a privatized health care system, health care in the United States can be extraordinarily expensive at the point of sale. Although federally subsidized care is available through Medicare, Medicaid, and the Affordable Care Act, Americans are uniquely dependent on their employers for health insurance, with more than half of Americans receiving employer-provided coverage.
Offering a robust set of coverage options provides employees (and their families) with an important lifeline against the costs of unpredictable medical issues.
HSAs and FSAs
Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs) offer similar value to employees, but they are structured differently. Rather than providing coverage for medical expenses directly, they allow employees to dedicate tax-exempt funds to qualifying medical expenses.
An HSA must be paired with a high deductible health plan (HDHP) and funds are either saved or invested, accruing value over the lifetime of the account. An FSA takes a “use it or lose it” approach on an annual schedule — contributions are pre-funded at the beginning of the year, and any remaining funds are usually lost if they are not spent.
Other types of insurance plans employees can offer include life insurance, disability insurance, and accident insurance. In combination with health, vision, and dental insurance, companies can show that they have their employees’ backs no matter what they are up against.
Paid Time Off
Paid time off (PTO) is another essential component of the modern benefits package. Encompassing holidays, vacation, sick time, grievance, personal days, and more, PTO allows employees to tend to needs outside of the professional sphere. Time off can be regenerative and restorative, helping to prevent burnout and improve focus and productivity in the workplace.
Although smaller teams can find it difficult to offer generous paid time off, some states are developing innovative ways to support businesses as they help their employees meet their own needs.
Tuition Assistance or Reimbursement
Of particular interest to younger employees, tuition assistance or reimbursement can be hugely beneficial. The costs of higher education continue to rise, and employees are finding their way into the workforce with high tuition or heavy student debt burdens. These expenses are a drag on consumer spending and can prevent employees from taking advantage of all of the benefits available to them, like retirement accounts or HSAs. Offering to offset some of those costs can be life-changing.
Continuing Education Stipends
On a related note, some companies have started offering stipends for continuing education. This is a gift that gives back. People are often interested in further developing their skills or learning new ones, but they often feel that the costs are prohibitive or that their time is better served by just focusing on the tasks at hand.
Providing resources for continuing education removes the cost barrier and shows employees that you support their desire for professional growth. As an added bonus, you now also have an employee with better skills who is contributing more to the company, and who is in a better position to advance in their career.
Financial services and other related benefits are a major factor in whether or not companies can manage to attract and retain their talent. Some of these can be expensive and complicated to administer, but they pay dividends in employee satisfaction that make them worth the investment. By crafting employee personas and tailoring your benefits package to appeal to different groups, your business will be on the fast track to maximizing the employee experience.
At Succession Resource Group, we understand the challenges facing the modern business as it tries to do right by its workforce. Reach out to our team of skilled professionals today for a consultation so you can develop the benefits package that’s right for your business.