Take care of your employees and they will take care of you. Here are ways to emphasize employee benefits while staying within your budget.
As companies are finalizing W2s for 2014, the cost of payroll will be felt now more than any other time of year. While providing benefits is something companies with excess capital will gladly do to inspire employee loyalty and productivity, smaller and more tightly budgeted companies feel the squeeze. There is a carefully balanced line employers must walk to keep quality employees while focusing on the bottom line.
The connection between benefits and the bottom line is direct and logical in a long-term outlook. Problems often occur when, in the short-term, a company is required to tighten its belt. Budgeting appropriately for the revolving needs of your company’s benefits plans is one way to ensure benefits are not the first things cut when times get hard.
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When evaluated in a long-term company outlook, company benefits are actually investments with measurable ROI. Happy, healthy employers are more productive and loyal to their brand. Consider some of these financial and intangible ways companies invest to provide the best employee benefits.
Bonuses, gift cards, and healthy competition in a workplace support the bottom line in a couple of different ways. Money is motivating. The promise of an extra reward for going above and beyond the call of duty inspires dedication and hard work. With regular reminders, these incentives can greatly enhance productivity and lead to higher profit margins.
Competitive incentives can further promote workplace innovation and production by turning work into a game. When employees can focus on realistic goals that set the bar high without being unconquerable, their performance will improve.
Healthcare benefits are likely the most obvious and necessary benefit a company provides to its employees. Healthcare benefits can help build the bottom line by ensuring employee health. Particularly with the rise in preventative care programs that healthcare plans offer, your company may receive group and individual discounts for participating. Employees who are involved in these programs are less likely to miss work due to chronic and acute illness, which directly correlates to productivity and improving the bottom line.
Other financial incentives, including moving expenses, encourage highly skilled workers to choose your company over the competition, potentially giving your company a significant advantage. Making an investment in the right team members for the job, regardless of location, is an investment that has the potential to pay off many times over.
Many employees might not be aware that their deductible expenses such as unpaid employee expenses and tax preparation costs may qualify as itemized deductions as long as they exceed 2% of the employee’s total income. Informing employees about this part of employee tax code is another good way to maintain employee loyalty from year to year.
The key for any financial incentive is following through. Never make empty promises or change the terms of a financial reward, even if it’s not contractually bound. Doing so can lead to resentment and discourage employee loyalty rather than improve it.
Often, employees who are the happiest in their current positions benefit from the intangible rewards that a company offers. Many companies are moving towards flexible work plans that allow employees to work away from the office some or all of the time. Some even allow families to work around their children’s schedules so their lives can run smoothly while holding down a full-time job.
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Listening to your employees’ feedback is another intangible benefit that will go a long way to inspire loyalty. Workers who are respected and feel heard are more likely to have a high morale and be willing to work harder every day. Encourage creativity in the workplace and foster an atmosphere of positive communication to make your work environment a happy place for employees to work.
Give credit where it is due both publicly and privately. Many successful companies highlight employee activities that went above and beyond in monthly meetings. On the same token, never publicly criticize or shame an employee for poor performance. An executive who makes the time to interact with employees in these positive ways helps a company feel like a team and goes a long way to inspire productivity and loyalty.
Evolving Nature of Employee Benefits
Perhaps the most important aspect of benefits as they relate to the bottom line is that they are in a constant state of flux. Even healthcare benefits are subject to change from year to year. Knowing your employee demographics and constantly working to improve the benefits that have the highest return rates will keep your company balanced between employee loyalty and the bottom line. Consider surveying your company on a regular basis or having HR representatives and managers engage in ongoing conversations with employees about which benefits work best and what the company is missing.
Along with developing innovative ways to keep the discussion about benefits ongoing, initiate some standards of measurement so the management team can keep track of which perks are positively correlated with an increase in worker productivity and the overall bottom line.