For any company of any size, benefits are an important part of attracting and retaining top-tier talent.
WHY YOU NEED BENEFITS
Baseline benefits have become table-stakes for any company looking to hire the best talent possible. You simply can’t overlook standard packages, including health insurance (full or partial employer coverage), unemployment, and workers compensation. Additional offerings include life insurance, 401k plans, flex and dependent care spending accounts, and commuter benefits. Keep in mind that each additional benefit offered will become an incremental cost to you business. It’s important to determine how important benefits packages are to your new and existing employees, and if you can budget the appropriate amount to fund them.
In addition to the more classic employee benefit options, many companies are now offering new benefits that not only improve work-life balance, but also decrease the employee’s cost of living. These include benefits or perks such as catered lunch, dog-friendly offices, gym memberships, travel stipends, and even performance incentives related to physical activity.
WHY YOU NEED BENEFITS NOW
By now, you’ve already considered how and when to attract new prospective employees away from your competition. How are you accomplishing this? An attractive compensation package is only one part of the equation. If you’re company is generating revenue or is pre-revenue but venture funded, you’ll want to ensure you have the bare minimum benefits that new employees will ask for – namely health insurance, but also retirement packages and even flexible work schedules. For example, the ability to periodically work from home.
It’s critical to set these policies in place early and go back to them from time-to-time to ensure you’re attracting the right talent. Has your company recently raised a large round of funding or has become very profitable? It’s probably time to fully fund your employee’s health insurance and make sure they have a barebones 401k plan to contributes towards. Want to keep your employees in the office and collaborating more with one another? Often time, the cost of catered lunch (and even dinner) can be well below the opportunity cost of having the great majority of your employees leave the building for lunchtime.
IMPORTANT BENEFITS CONSIDERATIONS
If you have a general idea of your business’s potential growth trajectory, choosing the right benefits provider and/or package can help you attract and retain your future employees. The sooner this is set up, the better.
More often than not, you’ll be acquiring your benefits package through a broker that works with larger insurance and financial companies.
Here are top considerations throughout the benefits buying process:
- What size and type of business do you typically service? Can your services grow with my company?
- Do you offer self service software that can be administered by employees?
- Do you offer flex spending (FSA) and or (DCA) dependant care account?
- How responsive are you? Do you offer customer service for my individual employees?
- What are your contract terms & conditions of service?
- What services and reporting are covered under this agreement?
- Is there a minimum monthly fee for your services? If so, how much will it cost for each additional employee per month?
- Can you send me a list of all other fees related to other services?
- Are you equipped to help me with other benefits products?
This is highly dependent upon the benefit being offered, but with a group health insurance plan, for example, the annual cost to the employer will be $5,000+ per individual or $12,000+ per family when splitting costs with the employee.
It’s important to read through your benefits provider’s general terms and conditions before signing anything. Take note of contract length and also enrollment periods.
Are they available to you when you need them? Some benefits provider customer service teams might work non-holiday business hour only, others might be available to you after hours and on the weekends. When speaking with references, inquire about their level of satisfaction with customer support.
Ask for the ability to speak with references that have used this benefits provider in the past. If possible, try to also identify a client that they don’t list as a reference that might have had a negative experience.