Now, more than ever before, maintaining a positive business reputation is vital to enticing customers, attracting talent, and retaining your employees.
In fact, when job hunting, more and more job seekers are doing their due diligence when it comes to researching companies that are hiring. Websites like Glassdoor.com allow for employees (both former and current) to post (anonymously) their experiences and sentiments for the company. People can freely share their thoughts on work conditions, career progressions, and benefits that they have experienced with the company.
One of the best ways to attract and retain skilled employees and talent is through a robust employee benefit program. The better your benefits are, the less likely people will want to leave and the more likely that people will want to join your company.
In addition, today’s consumers are more attuned to business practices and will tend to support companies that treat their employees well.
Making sure that employees are well taken care of through a comprehensive benefit system will benefit your business both internally and externally.
What are employee benefits anyway?
Employee benefits are additional compensation options on top of salary that you give to employees. These are typical examples of benefits:
- Health insurance
- Retirement plans
- Discounts on company products or services
- Generous vacation and sick leave
- Paid parental leave
- Hardware provisions like laptops, phones etc.
- Wellness provisions like gym memberships, etc.
- Other benefits like personal and professional development budget, etc.
Beyond the startup-type benefits like catered lunches or ping pong tables, employers like you should consider offering benefits that you know will enhance the quality of life of your employees in the long term.
After all, according to the famous business mogul Sir Richard Branson, “happy employees = happy customers.”
Why employee benefits are good for your business
Aside from the fact that having employee benefits will definitely make your employees happier, various studies and research have shown that employee benefits also help the employers.
- A Willis Tower Watson report showed that 78% of employees reported they’re more likely to stay with an employer because of their benefits program.
- According to a 2020 study by Metlife, 69% of employees say having more comprehensive benefits would increase their loyalty to the employer.
- 70% of Forbes Global 2000 companies use benefits to boost engagement, retention, and revenues.
- In a study conducted by Unum, 41% of workers said they’re likely to look for a new job with better benefits. This number is even higher among Millennials (57%) and Gen Z (65%).
A more engaged workforce means that your employees are less likely to go looking for work elsewhere. This means an increase in your retention rate and a decrease in your turnover rate. This is important because studies have continuously shown that retaining talent is more cost-effective than hiring new talent.
In fact, some studies have shown that it costs a business about 6 to 9 months’ worth of salary on average to replace a lost employee. So imagine, for an employee earning $60,000 a year, that totals approximately $30,000 to $45,000 in recruiting and training costs.
Every dollar counts.
It’s not just about the money
Jessie J was correct when she sang the words “it’s not about the money, money, money.” A Glassdoor’s Employment Confidence Survey found that 80% of employees choose additional benefits over a pay raise.
Money simply isn’t the be-all and end-all nowadays. Employees want to feel that they are genuinely appreciated. Employers can show this through offering benefits and programs that help improve employee well-being or quality of life.
With the talent market being more diligent in their search for new workplaces, it’s important that you go beyond simply giving a good salary. You need to help employees achieve a sense of security and peace of mind through their benefits.
Customers will take care of you if you take care of your employees
Nowadays, it’s not just jobseekers that are more discerning, customers are as well. A CSR study showed that 71% of US Millennials hope companies will take the lead on having a healthy and ethical work culture.
For a lot of people, brand-name companies are not solely defined by their products or services; they also represent certain values. These values should align with what customers are looking for in order to attract them. In this regard, according to a new report from Morning Consult, 90% of consumers said it is important to them that brands take care of their employees and treat them well, especially in tough times.
According to a new study by McKinsey & Company, 90% of surveyed customers said that to gain their trust, companies need to protect their employees’ financial and health stability, even if it meant financial losses during the COVID-19 pandemic.
The McKinsey study also mentioned that a quarter of consumers surveyed ranked employee treatment as one of their top buying criteria. If a company is generous and ethical with its employees during the pandemic and onward, it’s likely that their actions will be noticed and make a positive impact on the brand.
Simple math: Happy employees = happy customers
Keeping your workers’ needs in check will keep your customers happy.
The owner of Termite Survey, Matt Scott, mentioned, “Happy and content workers are expected to engage clients with a much more positive mood resulting in a greater degree of customer satisfaction. Producing a more enjoyable consumer service eventually generates a higher rate of return. In comparison, poor workplace loyalty and overall weak organizational productivity will significantly negatively impact company activities.”
How to get started on giving out benefits
If you still don’t have a solid benefits system implemented in your business, then get to work. Take time to set up channels of communication for employees to be able to share their thoughts about benefits with you.
You can send out a quick questionnaire polling what benefits employees would like to see. Get direct feedback and clear insight into where you’re standing. Sites like Typeform or Google Forms are free survey creation tools you can use.
Small to medium businesses can get started on offering smaller perks like flexible work hours, the option to work from home, or more generous paid time off.
Another thing we suggest is setting up retirement plans for your employees. Retirement plans are typically in the form of 401k, but with the introduction of the SECURE Act, there are new services available like Pooled Employer Plans (PEP) which are managed by Pooled Plan Providers (PPP) like peppermint.
Accessing retirement plans is now possible for SMBs
In the past, 401k retirement plans were only available to bigger businesses and corporations due to the large financial and administrative burden it placed on the employer. But as mentioned above, the SECURE Act now allows for the creation of PEPs which lets businesses like yours offer retirement plans to prospects, yourself, and employees!
Consider Pooled Employer Plans (PEP)
PEPs are low risk investments because your PPP will shoulder most of the risk and manage the day-to-day management of your plans and funds. It’s a win-win situation for you as an employer and for your employees.
You get to take care of your employees by helping them secure their future and you also get the added benefits of things like tax credits of up to $15,000 when you sign your business up for retirement plans.
Fill in the gap of those who still don’t have retirement plans
Aside from the obvious benefits of PEPs to your employees and your business, don’t forget that offering retirement plans as a small or medium-sized business will give you an edge in attracting good talent and retaining your top employees. According to Salary Finance, 35% of employees have no 401k plan balance – and this percentage goes up to 66% for Millennials.
With those numbers in mind, you can see that the market for businesses that offer retirement plan benefits has great potential. If you sign up for a PEP, you’ll be filling in that gap and tapping into that potential.
Wrapping up: Join the PEP squad
Because of this pandemic, we’ve seen the importance of caring for your workers who are the backbone of your company. Employee benefits can help increase worker engagement, loyalty, and productivity while providing long-term resources for your employees’ well-being. Offering useful and valuable benefits goes a long way toward helping you build a positive reputation among your clientele.
Aside from simple and easy to implement benefits like work from home options, increased paid leave, or flexible work hours, you can explore setting up a retirement plan for your employees through a PEP.
PPPs like peppermint are here to help you select the best PEPs for your business. Peppermint takes care of all the admin work and nitty gritty details for you.
If you want to learn more about how to join a PEP, take a look at our SMB Retirement Programs: Pooled Employer Plans 101 to get you started on the basics of PEP.
We’d be more than happy to help. Just leave us a message and one of our advisors will get in touch with you.