Recruiting & Hiring Blog for HR Professionals

Building a Better Benefits Package for Your Small Business

Any HR manager knows that there is a significant cost associated with providing benefits packages to your employees (which is why some employers chose not to offer them). Your company may be in a position where you can provide a luxurious benefits package - but these items can be pricey for small business owners.

A 2006 study from the Bureau of Labor showed that in companies with less than 100 employees, 60% of companies offered health insurance (the numbers go down from here), 47% started retirement plans for employees, 38% offered life insurance, 27% offered short-term disability and 19% provided long-term disability insurance.

With these diminishing numbers, it’s easy to see that small businesses often struggle with providing benefits. However, there are ways to take aspects from what you are already offering and turn them into a non-traditional benefits package.

Developing Your Benefits Package

If you are building your benefits program from scratch, current employees can be a very valuable resource for seeing what you are doing right and what is being done wrong. Employees can give you some insight on what they value in a company benefits package. Plus, they will be a great resource to let you know what the intangible benefits your company has to offer.

Building a benefits package will take some work, but it is a great step to shift the company culture to a more benefit friendly environment. To help you get started, here are there types of benefits to consider when building a comprehensive package:

 
#1: “Traditional” Benefits
 
When someone hears the words “Benefits Package,” traditional benefits are what he/she is usually referring to. Health insurance, 401(k), profit sharing, tuition reimbursement and paid time off are all standard items that are found in most benefits packages. But in today’s modern HR world, the benefits marketplace has changed dramatically.
 
The recently enacted Affordable Care Act allows employees to have access to health insurance for a reasonable cost, when they were previously forced to pay high premiums for little to no coverage. Additionally, employees can also set up an IRA at their local bank if a 401(k) is not offered as part of the company’s compensation package. These changes have allowed for more control over what employees have access to, which has changed the entire landscape of “traditional” benefits.
 
Granted, employees will always prefer having these items included upfront (since seeking these items on their own will cost them more money). But in today’s world, you do not have to provide every item that was once typically offered in a traditional benefits package. Focus on trying out one or two and seeing how they take off within your company.
 
#2: Awesome Corporate Culture
 
As a candidate is searching for a job opening, chances are, he/she won’t read through the job and company descriptions with a fine tooth comb. However, the “Benefits” header is a flashing red light for the applicant to stop and take a closer look. Since you have their attention, this area is a great place to give the applicant a taste of the corporate culture beyond the generic “Company X was founded by John Doe…”
 
Most likely, it is probably not financially feasible for small to medium sized businesses to shut down for a week to go on a Hawaiian company retreat. An alternative that will be better for your budget is a catered company lunch. By listing these extra perks, you get to show your potential employees you appreciate what current employees do. Additionally, as more and more Millennials enter the workplace, there comes more pressure to offer more to employees. But remember: Millennials love their free time. Larger companies can offer more vacation time to employees, but even if that’s not feasible, offering Friday afternoons off, pending time is made up Monday-Thursday, can go a long way!
 
#3: Part-time Benefits
 
In most cases, part time employment does not often come with benefits. Applicants are not expecting to see a long list of perks, so if you do have a few small benefits listed here, this can make your company shine. Companies that mainly hire part time employers often do not think they have much to offer. But part time benefits packages can include tangible and intangible benefits to make your company stand out.
 
Take a moment and think about what you DO offer your part time employees: If you provide uniforms that can be a tangible benefit; “Flexible Schedule,” and “Opportunity to Advance” are common intangible benefits that can also make your company more appealing.
 
Overall, keep in mind that if an applicant it being actively pursued by a company that lists no benefits and one that lists a few, he/she will probably chose the one that is offering something a little more than a paycheck.

The benefits section can be a touchy subject for some employers. If you have them—great! This is the area where you can broadcast all of the great perks of working for your company. If there is not a formal benefits package in place, you can still list valuable perks with the help of your great company culture. Not every company has millions of dollars to set aside to compete in this area, but there are items you may not have previously considered “benefits” that you already have! In the end, never underestimate the value of your employees—a happy employee can be great intangible benefit for your overall organization!

The Online Recruiting Guide: 11 Steps to Attract More Applicants

Topics: Recruiting Best Practices, Hiring for Small Business, Benefits

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