As a business owner managing and growing your business, you may be expected to know and understand the inner workings of your employee benefits packages. Yes, you may be familiar with the essential elements, such as areas of coverage and copayments – but the inner workings of your plan and how competitive they are compared to other plans in the marketplace may not be within your wheelhouse.
Employee benefits packages can come in many forms, shapes, and sizes; along the way, they can get complicated (trust us, we know!). With new options and vendors becoming available on the market every other day, it’s important to ensure that you do a check-in on your employee benefits package. A competitive employee benefits package has its perks and is a great avenue to help employees reduce the cost of taking care of themselves and their families. Reviewing your employee benefits package is key to ensuring it’s comprehensive and, most importantly, that the packages are competitive with what other businesses are providing as part of their total compensation package for employees. Companies are now going the extra mile to include more creative benefits, which serve as differentiators and give a competitive advantage, therefore attracting and retaining bright minds.
So, what are some great ways to ensure your company employee benefits packages stay competitive?
1. Have well-defined organizational goals
You might be wondering what do organizational goals have to do with employee benefit packages. Well, my friend, it has everything to do with it. Without clear goals to align your benefits to, you will be shooting in the dark to know if what you want to change will help you achieve the correct end result. For example, if you are looking to hire more executive talent as a key organizational goal, you need to know if the employee benefits package you have or want to change will appeal to that talent market. Without this in place, you’ll likely be running around in circles and wouldn’t even be close to being competitive. Having clear goals makes it easier to assess if your package is competitive enough and where you may need to make more changes.
2. Listen to what your employees ask for
Your employee benefits package wouldn’t be very competitive if you build them within a vacuum. It is key that if you are going to have a competitive employee benefits package, you design them with an understanding of your employee’s needs and areas of coverage that matter most to them. A great way to uncover this is to conduct a benefits needs assessment. This will serve as an eye-opener to what your employees really want without any guesswork. Trust us – you don’t want to be spending a large amount on a plan employees’ don’t utilize or find helpful for their healthcare needs. The needs assessment can be in the form of surveys, questionnaires, and focus groups, and the feedback should be applied to any changes you are considering.
3. Don’t rush the development stage
At the development stage of making your employee benefits package more competitive, you need to assess the pieces of information, including goals, costs, and package offerings, and analyze how they would fit into your organizational budget and processes. Employee benefits packages are not cheap; they can sometimes be up to 40% of the total compensation package for employees. Knowing that this area can vary in cost, you want to ensure you are striking a balance between being creative and competitive but being in line with the budget for that cost center. One thing you dont want is that the cost runs too high, resulting in the benefits package being reduced or stripped back after the first year. This will definitely leave a bad taste in your staff’s mouth.
4. Market your benefits to your employees
Beyond someone’s first day and in a case of emergency or medical need, many employees don’t always remember what is in their employee benefits packages. The value of the benefits offered needs to be reinforced and communicated in detail in an HR folder or company intranet so that employees know the perks they’re entitled to. They also need to have a good understanding of how their benefits work. For example, is there an online portal for reimbursements, or do they need to be mailed in? Also, by marketing your employees’ benefits package, you are demonstrating that you are listening to your employees and considering their needs in the benefits offered.
5. Always seek ways to improve by evaluating consistently
If you want your employee benefits to be competitive, this is not an area of your business where you want to ‘set it and forget it.’ At least on an annualized basis, you want to review your benefits package, analyze usage rates and compare it to new offerings in the market. Bake this review and analysis process into your annual employee lifecycle calendar to ensure you never forget and make any changes within the renewal period.