Budget Employee Benefits for Small Business
For many small businesses, budgeting for employee benefits may seem like building your own Fabergé egg, representing money and resources that perhaps you feel could be better spent elsewhere.
Instead of viewing it as an expense, if you consider employee benefits for staff retention and employee satisfaction then it can really be viewed as employer benefits; the advantages to your own business can be significant.
Many successful small businesses utilize employee benefits to attract and retain employees, avoiding the pitfalls and significant costs of employee turnover. Most employers experience employee turnover whenever the mental and physical health of their employees begin to decline and there is no support available.
Cost of Employee Turnover
The Sasha Corporation, an HR consulting firm founded in 1984, averaged results of 15 studies and determined that the average cost to turn over an employee making just $8 an hour was $9,444.47 per turnover!
Taking away averages, consider that each position in a company, especially for high-tech companies or regulated positions such as health care, can skyrocket to over $100,000 of specialized training per turnover.1
Budgeting for employee benefits to retain employees can be of significant value to your business.
Employees are less stressed knowing their company is there to take care of them during times of illness, and employees are more likely to show loyalty to your business, thinking of it as their career and not just “a job.”
Employee Benefits Options
If your small business is on a budget, our employee benefits specialist at Benefit Strategies can help you find the right balance. It is possible to offer affordable employee benefits, to help you provide benefits solutions to your employees, while still considering your bottom line.
For instance, a common solution for small businesses on a budget is to cover 50% of the cost for employee benefits, which incidentally, is also tax deductible for your business. Covering half the costs is a great way to let your employees know you want to invest in their well-being, and also has an added benefit of safety; employees are less likely to abuse their plan when they are paying for part of it.
Another option is a health spending account, which is a self-insured private health plan that is available in Canada. These plans allow employees (and employers) to pay into them over time, and be available to employees when they need it for whatever they require, such as glasses, massages, and eye surgery.
Flexible employee benefits plans (aka Flex Benefits) offer customizable packages that can be tailored to the individual needs of an employee. These flex benefits plans are great for employees who have chronic conditions or long-term rehabilitations, or for those who see their own value in benefits such as chiropractic services, massage therapy, or retirement options.
Flex benefits are becoming increasingly popular with small businesses as employees are actively seeking out companies that offer them. For some employees, they are the best employee benefits option as they are tailored to their very specific needs.
Summary
Whatever option you choose for budgeting for employee benefits with your small business, it is highly recommended that you educate your employees about their employee benefits plan and what it offers them and their family.
Hosting an employee meeting to go over their benefits plan is a great opportunity to find out if employees are happy with their plan. Employees who understand the employee benefits you are offering to them will go a long way in their belief that your company is taking care of them and is there to support them.
Budgeting for employee benefits offers a significant overall benefit to your business, no matter how simple or elaborate your benefits package may be. Reducing employee turnover and, therefore, reducing costs of training new hires, as well as providing a piece of mind to your employees, will all help to reduce overall stress while increasing employee satisfaction and productivity.
Take care of your employees and they will take care of you!
1https://smallbusiness.chron.com/average-cost-train-new-employee-44072.html
Have more Questions about budgeting for employee benefits and services?
Call: Daryl or Tammy: 1-780-437-5070
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Email: inquiries@benefitstrategiesinc.ca
