3 Signs It’s Time to Update Your HR Benefits
When given the choice between a higher salary or better benefits, the latter wins. Every time.
Are your current benefits enough to keep your practice competitive in today’s tough job market? If you’re trying to control costs, consider this: The cost of replacing a good employee can range from one-half to two times that person’s annual salary. And if you’re still using the same program you signed up for several years ago, there’s a good chance you’re leaving ROI on the table. Employees who feel valued and appreciated are more likely to stay loyal to your practice and will often go the extra mile.
Let’s take a look at several signs it might be time to update your benefits package to help you decide which options make the most sense for your practice.
1. Employees are leaving
Not every resignation is because of benefits. But if you’ve been experiencing a higher-than-anticipated spate of departures, it’s a potential cause to consider.
In a recent Forbes Advisor survey, 40% of employers said workers are leaving jobs to find roles that offer better benefits. One in 10 employees said they’re willing to take pay cuts if it means having access to a more robust benefits package.
Contrary to what you might think, pay raises alone aren’t what make people want to stay. At a time when many businesses are adjusting their benefits packages to attract top talent, salary is often rivaled by other forms of compensation when convincing people to move on to new opportunities.
What to do: Don’t wait until the two-week notices start rolling in. You can be proactive by interviewing your staff to understand what benefits and perks are most appealing to them. The answers may surprise you.
In the survey mentioned above, employees weren’t just interested in healthcare and retirement plans. Nearly a third named mandatory paid time off as one of the most desirable benefits. What makes this finding even more notable is the fact that many small businesses can actually save money by offering this benefit. In addition to higher productivity and less risk of burnout, requiring employees to take time off also saves you from the financial headaches of end-of-year payouts.
Other benefits that ranked high with employees include opportunities for professional development, employee discounts, and perks to support work-life balance.
The only way to know what’s most attractive to your employees is to ask. While you may not be in a position to fulfill every request, employee interviews are a great starting point.
2. It’s been more than a year since your last update
Here’s another interesting finding from the survey mentioned above: Employee benefits have become a top strategic priority for 80% of small business owners in the post-pandemic job market. Why? Because they play a critical role in everything from office culture and morale to employee well-being and retention. For this reason, more than 60% of companies have changed their benefits within the past 12 months.
If your practice is still offering the same package you set up years ago, it may be putting you at a disadvantage in an increasingly competitive job market.
What to do: This is one area where having a specialist in your corner is key. Find a knowledgeable HR consultant who can help customize a plan that will benefit both you and your employees. There are many industry experts who have built entire careers around helping businesses build cost-effective employee benefits packages that won’t break the bank. They can help you create a budget, decide what to include, find the right vendors, and educate employees on their options.
An HR consultant can also help you revisit your benefits at regular intervals to make sure you’re adapting to the latest market trends. This can be a great opportunity to convey the value of your new compensation package when speaking with prospective candidates and current employees.
3. You cover only the basics
Some benefits are required by law. These include items like workers compensation and unemployment insurance, as well as paid sick leave in states like California and Colorado.
But if the Great Resignation has taught us anything, it’s that basic benefits are no longer enough. At a time when tens of millions of workers are leaving jobs for higher wages and better prospects, taking care of employees is becoming more important than ever.
In fact, 80% of workers who quit their jobs later regretted their decisions. Turns out, the compensation that initially attracted many job hoppers wasn’t enough to make up for missed coworkers and culture. And mentioned above, many may have stayed in the first place if there was just a little more support for well-being and financial health.
What to do: While you don’t have to explore every possible benefit, going above and beyond on a handful of key items can go a long way when it comes to employee retention. Forbes Advisor put it this way:
“Small businesses often have less leverage than larger businesses to offer some of the shinier employee benefits big companies love to tout: gym discounts, in-office coffee bars and exotic company retreats. But the data shows that these aren’t top priorities for workers.”
A typical benefits package at a private practice might include health insurance, paid time off, a retirement plan, and a flexible spending or health savings account. At a minimum, it’s a good idea to offer some mix of these. In addition, there’s a wide range of other benefits to consider, such as:
- Bonuses and incentives
- Commuter benefits
- Employee discount programs
- Annual performance-based pay raises
- Financial education
- A wellness program
- Pet insurance
It’s important to stay competitive, and that means taking a look at employee benefits to make sure you’re getting a program that’s both attractive to employees and reasonably priced.
To help, omo has partnered with OneDigital to give members access to one of the industry’s most recognized HR consulting platforms. Our services are designed specifically for independent physicians, with options for 1:1 consultations to help you design your ideal benefits package.