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March 1, 2004
Do
You Know...
National Director Jennifer Loftus is the newest Chair of
HR/NY's Public Relations committee! Jennifer's charge is to
develop HR/NY's media presence.
HR/NY is
the New York City chapter of the Society for Human Resource
Management.
If you'd like to join Jennifer in her efforts,
send an e-mail
today!
Attracting and Retaining Employees Through Voluntary
Benefits Offerings
This
week's Astronology comes as a special "readers ask"
issue courtesy of Sarah Dempsey of Dempsey Uniform and Linen
Supply, Inc. Our regularly scheduled topic, "Creative
Solutions to the Thorny Issue of Pay Compression," will
appear in the March 15th issue. Thanks for writing, Sarah!
In this hectic world that we live in, employees are
looking for options to make their lives easier. Rising
healthcare costs, childcare concerns, and financial
stability all add to employee stress. In addressing that
need, many human resource departments have found that
offering a wide array of voluntary benefits, ranging from
vision and dental insurance, to elder care and adoption
assistance, is a successful way to help ease anxiety.
Primarily a win-win situation, employees appreciate the ease
of enrollment through work that often is accompanied by
financial and life-planning advice and payroll deduction;
while employers realize the satisfaction of attracting and
retaining employees at little or no cost to the company.
Voluntary benefits are added to core offerings of health
insurance and retirement packages at a discounted cost. The
employer negotiates with outside agencies for the best group
rates, and in turn, presents these offerings to their
employees. Employees then have the option to pick and choose
which benefits that they feel would be most beneficial, and
pay for these benefits themselves. Voluntary benefits
packages added to an employer's defined benefit package may
fall under ERISA, depending upon the circumstances. If
voluntary benefits are bought with pre-tax dollars, they are
subject to Section 125 requirements.
In a
2003 MetLife Study, Employee Benefits Trends, nearly
one-third (28%) of employees surveyed said they are
interested in having their employer provide a wider array of
voluntary benefits that they could choose to purchase and
pay for themselves. Among employers, 20% of employers' most
important benefits strategies were to "provide a wider array
of voluntary benefits."
In the study, employers recognized the advantages of
offering voluntary benefits. A little over half say that
payroll deductions make it more convenient for employees to
pay for these benefits (55%) and that offering voluntary
benefits is a more convenient way for their employees to buy
the products on their own (51%.)
Of course, before employers decide to offer voluntary
benefits to their employees, they must consider the fact
that they may have to contend with an initial cost to set up
the administration system for the program. This, along with
the fact that there may be less control over the quality of
the product, and difficulty in properly educating employees
on the offerings, are also to be considered.
What should you offer?
Before choosing from the vast array of voluntary benefit
offerings, it is important for HR professionals to analyze
their employees' needs. Employers should ask their employees
what voluntary benefits they feel would be most valuable.
After compiling a list of possible choices, HR professionals
should then consider the following:
- Find the right fit. Make sure that you choose
a benefits company that understands, and is willing to
offer, custom solutions geared specifically to your
company and employees. Research the reputation of the
company and the quality of the offering.
- Get technical. Paying for voluntary benefits
through payroll deduction is a useful tool that can
alleviate the need for paperwork and possible late fees,
while saving time and money. In addition, a website that
allows the employee to access benefits information,
email questions, and even administer their own
information, is a huge time-saver.
- Master the art of negotiation. Let the
provider know that optimum customer service is
imperative. Stress the importance of around-the-clock
customer service and education of your employees.
- Be creative. There are many voluntary benefit
offerings available that can help improve quality of
life, including merchant discounts and even pet health
insurance. These accoutrements are not only unique, but
can be very useful.
In the current economic atmosphere of rising healthcare
costs and corporate downsizing, one can argue that voluntary
benefits are needed now more than ever. Employees need to
know that employers are concerned about their wellbeing.
Offering voluntary benefits is an excellent and relatively
cost-free way for employers to let their employees know that
their shifting needs are both respected and understood.
How effective are your organization's
voluntary benefits programs?
Be sure to vote in our on-line poll!
Wonder what your fellow readers think about critical HR topics? Is your organization unique from or similar to others?
Click here to view the results of our past polls!
If you have a topic you would like addressed in Astronology, or some feedback on a past article, don't hesitate to tell us! Simply reply to this e-mail. See your question answered, or comments addressed, in an upcoming issue of Astronology.
Looking for a top-notch presenter for your human resource organization's meeting? Both Jennifer Loftus and Michael Maciekowich present highly-rated sessions on a variety of compensation and employee retention issues. For more information, send an e-mail to
info@astronsolutions.com.
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Copyright 2007, Astron Solutions, LLC
ISSN Number 1549-0467
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