Benefits are a key part of any employee compensation package because they are essential to attracting and retaining top talent. As you plan to take your career to the next level, so too should you be more discerning of the employee benefits packages that employers offer.
In fact, 51% of employees view benefits as a vital part of their decision on whether to stay on with their current jobs or move on to the next one. With that being said, some 83% of companies are now looking to enhance their benefits packages to meet their employees’ needs halfway and ensure they attract and keep the best talent.
Companies have different approaches to benefits, so it can be challenging to know what’s best for you and your career goals. This article will help you understand such programs and how to choose the best option for you.
Types of Employee Benefit Programs
Understanding the most common types of employee benefit programs can help you decide which is best for you. Here are some of them:
1. Health Insurance
One of the most important employee benefits is health insurance. It helps employees cover the costs of medical care, including doctor visits, prescriptions, and hospital stays. Health insurance can be provided by the employer or purchased by the employee. Employers often offer a group health insurance plan that is cheaper than an individual policy.
A good example is the Donor Network of Arizona, which offers employees comprehensive medical, vision, and dental benefits and even free telemedicine for their entire household.
2. Retirement Plans
Another important employee benefit is a retirement plan. Retirement plans help employees save for the future and provide income in retirement. Employers often offer a 401(k) plan, which allows employees to save money pre-tax and receive employer-matching contributions.
3. Life Insurance
Life insurance is another common employee benefit. It provides financial protection for employees’ families in the event of the employee’s death. Employers often offer life insurance as part of a group benefits package.
4. Disability Insurance
Disability insurance provides income replacement for employees who are unable to work due to an injury or illness. This employee benefit can help cover the costs of medical care and living expenses.
5. Paid Time Off
Paid time off is another common employee benefit. It allows employees to take paid time off from work for vacation, sick days, or personal days. Employers often offer a certain number of paid vacation days per year. For example, Axon offers its employees generous paid time off, with unlimited PTO for salaried employees and ‘quiet weeks’ when employees are encouraged to rest and spend time with loved ones.
6. Tuition Reimbursement
Tuition reimbursement helps employees pay for education and training. This employee benefit can be used for degree programs, certification programs, or job-related courses. Employers often reimburse a certain percentage of employees’ tuition costs on the condition that employees maintain a certain grade point average, but the guidelines vary per company. Achieve, formerly Freedom Financial Network, is an example of a company that offers tuition reimbursement.
Along with Voya and Desert Financial, both of which offer tuition reimbursement. Desert Financial even pays for professional courses and up to $10,500 for graduate programs each calendar year, while Voya offers impressive leadership programs.
7. Employee Assistance Programs
Employee assistance programs provide confidential counseling and support for employees. These programs can help employees deal with personal problems, such as stress, anxiety, and relationship issues. Employers often offer employee assistance programs as part of a comprehensive benefits package. Companies like Credit Union West offer their employees free counseling services and access to resources that promote mental health and general well-being.
8. Child Care
Child care is one of the best employee benefits possible for working parents. It helps employees cover the costs of child care, including daycare, babysitters, and after-school programs. Employers often offer on-site child care or subsidies for employee-sponsored child care. Companies Axon and Workiva both offer paid parental leave for any employee welcoming a new infant into their home.
9. Gym Memberships
Gym memberships are another employee benefit that helps employees stay healthy and fit. Some employers offer discounts on gym memberships, if not fully pay membership plans, or provide on-site fitness facilities.
10. Commuter Benefits
Commuter benefits help employees cover the costs of commuting to and from work. This benefit can be used for public transportation, parking, and tolls. Habitat for Humanity is a fine example of an employer offering employees spending accounts for health, dependent care, and transportation.
Benefits are set in place to help with employee satisfaction and should be chosen based on what works best for the employee. Some benefits may work better for those just starting out in their career, while others work better for those nearing retirement. It is important to carefully consider each employee benefit and what it entails before making any decisions.
Best Employee Benefits: What To Consider
Benefits are a huge factor in deciding your next career step. When choosing employee benefits, there are a few things you should keep in mind:
1. Your Needs
First and foremost, you need to evaluate your needs and decide what employee benefits are most important to you. If you have a family, child care and health insurance might be at the top of your list. If you’re trying to save for retirement, a 401(k) plan or other retirement savings plan might be more important.
2. The Cost
Employee benefits can be expensive, so it’s important to consider the cost of the benefits you’re considering. Some employee benefit plans, like health insurance, have premiums that are deducted from your paycheck each month. Other employee benefits, like tuition reimbursement, have no upfront cost but may require you to meet certain conditions, like maintaining a certain GPA. Consider the cost of employee benefits and how it will impact your overall compensation package.
3. The Coverage
It’s important to evaluate what the benefits cover and how deep they go. For example, if you’re considering health insurance, you need to consider the deductible, co-pays, and out-of-pocket maximums. If you’re considering a retirement savings plan, consider the contribution limits and investment options. Consider the coverage of employee benefits and make sure it meets your needs.
4. The Availability
Employee benefits are not always available. For example, some employee benefits, like tuition reimbursement, may only be available to full-time employees. Other employee benefits, like child care, may only be available to employees who work a certain number of hours per week. Before you choose an employer based on employee benefits, make sure the benefits you’re considering are available to you.
5. The Employer’s Contribution
Some employers match a certain percentage of employee 401(k) contributions. Other employers offer a certain amount of money per year for employee tuition reimbursement. Take all these into account and find out how much will be left as your take-home pay.
6. The Terms and Conditions
For example, some employee benefits, like health insurance, may have a waiting period before the coverage begins. Other employee benefits, like tuition reimbursement, are contingent on grades. Make sure you understand the terms and conditions of the employee benefits you’re considering.
7. The Tax Implications
Employee benefits are often taxable. For example, employee health insurance premiums are typically deducted from your paycheck pre-tax, but employee health insurance benefits are taxable when you receive them. Before you choose employee benefits, consider the tax implications of the benefits you’re considering.
8. The Impact on Future Employment
Some employee benefits, like tuition reimbursement, may impact your ability to get a job in the future. For example, if you’re receiving tuition reimbursement from your employer, you may be required to stay with the company for a certain period of time after you finish your degree.
9. The Administration
Some employee benefit plans, like 401(k) plans, require employees to administer the plan. Other employee benefit plans, like health insurance, are administered by the employer. Consider how much time and effort you’re willing to put into managing the employee benefit plan.
10. The Bottom Line
Employee benefits are a great way to attract and retain employees, but they’re not free. Consider all the factors mentioned above before you choose to sign an employment contract based on employee benefits. It’s easy to be lured in by the package an employer is offering, but make sure you understand all the implications before you make a decision. See that the programs you are receiving truly are the best ones for your situation and objectives.
Overall, the best employee benefits are the ones that fulfill your personal and professional goals. If not, they may not be worth the extra cost to you or your family.