Is it time for a benefits review?

Lots of businesses offer a plethora of creative benefits designed to attract Millennials, Gen Z, and… well, everyone. Cool stuff like coffee kegs, pet insurance, travel bonuses, and ping pong — it’s tough to compete with perks like that, especially for a small business owner. But by making sure the benefits you do offer are solid, including competitive pay, you’re much more likely to attract (and retain!) quality employees. Show you care where it counts, and believe us, they’ll hardly miss a game room or four-star catered cuisine in the breakroom.

Employee benefits matter today more than ever, and a periodic look at benefits is key to ensuring that your business is staying competitive, attracting top talent, and keeping loyal employees happy. Here, we’ll go through some benefits basics, then give you some ideas for add-ons that might not cost you much, but can pay off big in employee loyalty.

Salary

Let’s look at salary first — and specifically, let’s talk benchmarking. Salary benchmarking (or compensation benchmarking) is a process that matches internal jobs and their descriptions to similar jobs and descriptions in a salary survey or similar source of market compensation data.

Benchmarking pay gives you, the CEO or business owner, the opportunity to see what it takes to secure top talent because it helps you better understand the job market, the competitive wages being offered, and the demands of similar jobs. When your company is paying top wages, not only do you retain employees, you also attract new talent, and talent is arguably your company’s greatest asset. And if your business research identifies you aren’t competitively compensating your employees, you then have the opportunity to correct it — which only reinforces your employee/employer relationship further.

Once you have determined that your pay is competitive (or as high as you can afford to pay), you can stay competitive with annual or biannual merit increases. Merit pay, also known as pay-for-performance, is basically a raise in pay based on a set of criteria set by you, the employer. Merit increases reward the most productive and the highest-performing workers, which in turn incentivizes others to do better.

Payroll

How are you handling payroll? If you’ve not moved to direct deposit, this might be the time. The pandemic left many employees with financial uncertainty, among other anxieties, and you may be able to help ease some of that angst by offering direct deposit. By securely and conveniently delivering wages directly to your team members, you both win. Most employees appreciate this quick, foolproof payment perk, and it’s of great benefit to you, the employer, as it cuts down on payroll processing time and expense.

Once established, your business can promote your direct deposit program by partnering with your bank and inviting them into the workplace for education and sharing any current promotions. Consider giveaways and prizes to encourage worker sign-ups for direct deposit.

Retirement benefits

Too many Americans aren’t saving enough — or anything at all — for retirement. If you’re not already, consider offering a 401(k) plan that automatically funnels money from their paychecks into a retirement account. It’s essential to help your team afford an enjoyable retirement someday. Their contributions are tax-deductible, and as the employer, you can claim several tax benefits, too. Choose a payroll provider that makes it easy to set up a 401(k) plan. To retain top employees, offer an employer match — which is also deductible. Furthermore, you may also consider offering individual retirement account (IRA) options; ask your partnering bank or plan provider for details.

Health benefits

While you’re taking a look at benefits, this is the time to examine health benefits. If you offer a group health insurance plan, be sure to review it periodically to ensure that it’s still meeting your company’s needs and is competitive in cost.

If you have fewer than 50 full-time employees and don’t provide a group health insurance plan a qualified small employer health reimbursement arrangement, or QSEHRA, is an affordable way to help your employees with their healthcare costs. Technically, a QSEHRA is a health reimbursement arrangement (HRA) for small businesses. It doesn’t replace health insurance, but rather allows eligible employees to be reimbursed for qualified medical expenses.

Health savings accounts (HSAs) and flexible spending accounts (FSAs) are another great way to give your employees a tax-free way to pay for healthcare expenses. An HSA pairs with a high-deductible insurance plan; if you choose to offer an HSA, partner with your bank and let your employees know how to sign up. If FSAs are a better fit for your business, contact your benefits provider to add it to your plan.

Low-cost ways to do more

This might be a good time to think about what makes you competitive in terms of benefits. Is there something unique you offer, a specialized or unique perk that makes your employees feel valued? Maybe that’s flexible hours, ongoing training, team building events, or memberships. Once you’ve established what those are, consider rounding them out with some other fun perks at work. Here are some ways to do more:

Volunteerism

Encourage philanthropy while also supporting your community and creating a culture of giving back. Offer one afternoon each month when employees can leave early to volunteer. Match your associates’ charitable contributions or join the startups who’ve pledged their time to great causes.

Wellness

Wellness programs can potentially save you money from lowered healthcare costs, increased productivity, and tax incentives. While we often associate wellness programs with larger corporations, it’s affordable for small businesses to promote healthy workplaces, too. Organize a walking group to take a weekly lunchtime stroll, offer monthly in-office exercise or meditation classes, or contact local gyms and yoga studios about team discounts. Organize quarterly fitness challenges and hand out small prizes to those who meet their goals.

Professional development

Offer your employees opportunities for career development, such as memberships to professional organizations and online training courses. Tuition reimbursement is a great employee benefit, and it’s tax-deductible. For lower-cost alternatives, consider hosting monthly lunch-and-learns or launching a mentoring program.

Identity theft protection

Show that you’re keeping on top of fraud and cybercrime trends and are concerned about the safety of your employees’ information by offering free enrollment in a credit monitoring program. They’ll appreciate the peace of mind, and you’ll both benefit from time saved trying to sort out a breach.

Peer recognition

Ask employees to pay it forward! It’s a strong motivator, it helps to improve team relations, and it’s almost free. Ask employees to recognize a peer going above and beyond; give the honoree a gift card to a local restaurant (or hold a monthly drawing for all “above and beyond” recipients). Have team members take turns planning lunches or mixers to celebrate achievements. You might even consider employee feedback software — there are some great ones out there.

Free snacks

Spring for a little noshing and your team will love you for it. Stock up on bagged chips or healthy snacks at the warehouse store. Show up with bagels and coffee (or lattes!) once a month. And don’t forget the birthday treats!

In summary, expansive benefits and trendy offerings aren’t as important as competitive pay, relevant insurance, and benefits that fit your employees’ needs. A comprehensive review and perhaps a few small tweaks will ensure you’re building the best package for your team.