80% of the workforce will choose a job that offers benefits over a job that offers 30% more salary but no benefits.
While salaries have been important driving factors for employees, people are increasingly seeking the satisfaction that comes with benefits.
A contented employee is a key to successful business operations. As a business owner, you should strive to offer a balanced mix of benefits on top of good pay to retain your best talent and attract more from the market.
Let us take a look at why benefits hold such importance and how you can offer the best remuneration to your team.
Are benefits more important than salary?
A salary is the straightforward compensation a company pays to an employee for their contributions to the company’s operations. A benefit, on the other hand, is a perk that a company offers aside from salaries.
Salaries are the mandatory remuneration, while benefits are the complementary gains that may or may not be offered by an employer. Even though they are not compulsory, benefits hold utmost importance for employees when deciding on a job.
Benefits contribute to the work-life balance sought by the workforce of today. It makes their jobs flexible and satisfactory. By offering a lucrative benefits programme for employees, you can inspire loyalty in them.
1.Salary vs Benefits
A salary is a fixed payment by an employer to an employee for the work they perform for their company. It is a fixed payment usually paid on a monthly basis that can increase over time as the employees spend more time at a company.
Employee benefits or simply benefits are non-wage compensations in kind provided to an employee by an employer in addition to their wages or salaries. They can be anything from medical help and transport allowance to travel insurance and meal vouchers.
The biggest pro of a salary is that it is constant income. Employees can spend the money any way they want as well as save it for the future. A benefit such as a tour package is not much of use if they don’t plan on vacationing in the near future.
To counter that negative, the benefits package should be crafted by putting the employees’ needs in mind. Or better yet, make them choose the benefits themselves. This way, the benefits truly help them create a better quality of life.
2.The benefits of benefits
61% of employees say that benefits boost their job satisfaction. There are many advantages to providing your employees with a benefits package. Some of them are listed below:
a)Boosted morale and productivity
Receiving benefits over and above one’s pay greatly boosts their morale. They perform with vigor and are eager to make their contributions felt in the company.
This increases their productivity and the efficiency with which they perform. A happy workforce creates a positive work culture where everyone thrives and helps each other get better.
b)Improved quality of life
Affording a good life is what anyone hopes for when they seek employment. By providing them with additional benefits, you directly help them achieve a higher quality of life.
This contributes to their improved work-life balance as well, another important factor for the workforce of today. Satisfied and happy employees are likely to be more productive and bring innovation to your operations.
c)Attract and keep top talent
Offering benefits helps you inspire loyalty in your team. They appreciate the initiatives you take for them and want to perform better. This also helps you attract top talent from the market.
In fact, 60% of job seekers strongly consider the perks of the job before joining a company.
A benefits package often provides employees access to plans and schemes they wouldn’t have considered otherwise. Healthcare and travel are expensive, and many people avoid them simply because they cannot afford them.
A benefits package helps them avail of those services while simplifying the procedures to boot. They can even receive additional benefits by availing them through their company.
3.The benefits that drive employee satisfaction
When it comes to offering benefits to your employees, you can either start from scratch or upgrade their existing package. Whichever approach you choose, you should ideally involve the employees’ input to craft the most relevant package for them.
Given below are some of the most common and appreciated benefits that drive employee satisfaction:
Health Insurance is ranked the top benefit a job seeker looks for. Health insurance covers the medical expenses of an employee and their family. These expenses can be anything from a doctor’s visit to procedures and medicine required for maintaining good health.
Providing a comprehensive health insurance plan to your employees is a great way to ensure their optimal health. Moral, it assures them assistance in the most important aspect of one’s life.
If you can include family members in it, that’s a plus. You can also delve deeper by providing specific plans such as dental, vision, and mental health. A plan would cover illness and injury and provide sufficient support to help employees recover from it in the most efficient way.
A tax-advantaged 401 k retirement plan helps employees secure a functioning income after their retirement. It is an employer-sponsored retirement plan where employees contribute income and employers make matching contributions.
It directly helps employees save tax by reducing the taxable income. You can deduct your contributions in the year you make them. The withdrawals are tax-free. The scheme also offers protection from creditors and the IRS in many cases.
Securing a good life post one’s retirement is a natural end goal for many employees. It has become even more important with the pandemic forcing people into unexpected expenses and being unable to accrue savings.
Paid leaves refer to taking time off work for personal reasons but getting paid regardless for that period of time. A paid leave is a generalized benefit that covers many types of benefits. You can consider giving paid leaves if you cannot decide on a specific plan.
This is especially beneficial for extensively diverse workplaces. An employee can take a paid leave because they are sick, want to take a mental health break, have an emergency to take care of, or have some business to take care of with their bank.
d)Mental health help
Mental health is rightly getting attention in corporate spaces, especially with the onset of the pandemic. By providing mental health support in the form of counselling, coaching, and training, you can help make a positive change.
It lets the employee know that you care about their well-being and open up about their struggles instead of internalizing them. It also opens up conversations about mental health in your workplace that allows more people to speak up.
Mental health support also helps employees avoid ‘burnout’. Meaning chronic workplace stress, burnout is now an officially recognized phenomenon. Providing mental health support even in little ways can help you create a positive work environment.
e)Flexible work schedules
Over 51% of employees prefer working from home because it contributes to improving their work-life balance. Most companies are working in a hybrid work model in some way or another now.
Taking it forward by offering flexible work schedules to your employees helps them greatly. It allows them to work freely and at their convenience. It also allows you to hire people from anywhere around the world and not be restricted by geographical boundaries.
4.Don’t ignore the salary
It is true that benefits are the driving force of the workforce of today. However, that doesn’t mean that the salary should be avoided. It is still just as important to offer a reasonable salary to deserving candidates even when you offer them benefits.
You can certainly reduce some amount in the salary if you are offering benefits that truly compensate for it. But docking it too much can end up hurting you. For starters, the salary is what one sees as the first thing in a job ad.
Job benefits — no matter how good — will only be looked at after the salary. Moreover, the salary is a simple number while benefits are a list of often lengthy sentences that may take a while to read.
Additionally, benefits are what employees seek over and above a deserving salary, not in lieu of it. Offering them less pay paired with lucrative benefits may make them feel they are being conned into accepting an undeserving compensation.
As the corporate workspace evolves, a healthy work-life balance and job satisfaction have moved to take the center stage in an employee’s priorities.
Offering benefits along with a good paycheck allows employees to enjoy greater job satisfaction along with an increased quality of life.
You can include your employees’ input in what benefits to provide to them to make the benefits as inclusive and useful as possible.
Give your employees the best you have to offer and they will do the same in return. Their increased morale and productivity will help take your company to greater heights in no time.
Atreyee Chowdhury works full-time as a Content Manager with a Fortune 1 retail giant. She is passionate about writing and helped many small and medium-scale businesses achieve their content marketing goals with her carefully crafted and compelling content. She loves to read, travel, and experiment with different cuisines in her free time. You can follow her on LinkedIn.