Retain employees by offering benefits
The grounds-care industry, like many others, has one of business's most perplexing problems: how to attract and keep quality employees. Business people have pondered this since the beginning of time. We often invest a great deal of effort, time and money in searching for the right employee who will fit into our customer-service-based organization. No one enjoys losing a quality employee to the competition or to another industry. Therefore, the question remains: once you find the right person, how do you keep him or her on your team?
Benefits Benefits often can be a great way to attract and retain an employee in whom you have invested a considerable amount of time and money training them to perform the basic task of satisfying your customers. Offering employee benefits not only can have a positive effect on employees, but it also can affect you, the employer, in a positive way. Benefits aid in recruiting high-quality employees and also enhance the employer-employee relationship.
Benefits can be more cost-effective than simply offering a higher hourly wage or salary than a competitor. Potential qualified employees look at the pay in addition to other, less-tangible aspects that the company has to offer. These benefits come in many forms and on many different levels. For example, they can be educational benefits, in which employers support the on-going education of the team. By covering the cost of industry workshops or college-level courses, you improve the knowledge base of your employees, which leads to a more loyal employer/employee relationship.
Educational programs are obviously a great benefit. But when you mention the term benefits, what most people immediately think of are the other types of benefits most employers offer, such as vacation or sick leaves, insurance plans and retirement programs.
Vacation and sick leave Vacation or sick leaves are the most simplistic forms of benefits to offer and to oversee from an employer's point of view. To provide this benefit, all you need is a calendar for record-keeping. Your options on what types of leaves you want to offer can vary considerably. For example, you can choose to provide a fully paid vacation, a certain number of sick days or personal days after an employee has been with your company for a stated period. Or, you can offer some lesser form of pay during time away from the job. A calendar becomes the most important tool associated with this benefit. It ensures that no two employees use the benefit during your peak season or when you have important customer deadlines.
Insurance programs Insurance often is the second benefit a company installs for its employees. The decision of what type of insurance to offer and when to offer it can become a little more involved than that of vacation or sick leave.
Medical coverage of health insurance is the plan most employees request. The United States Bureau of Labor Statistics conducted a survey in 1994 that revealed that two out of three full-time employees at small companies participate in acompany-sponsored health-care plan.
It is possible to customize plans to fit both the needs of your employees as well as the company's budget. By offering a plan that requires some sort of cost-sharing by the employee, you can provide the benefit and still have some control over the costs.
When developing your plan, you may want to consider some additional forms of insurance that will increase your good standing with your employees. Life insurance, dental insurance and accident insurance are some examples that you can offer through a payroll-deduction program.
Payroll deduction is one of the easiest ways to provide additional benefits without incurring a large increase in costs or fees. The employer allows the employee to deduct insurance premiums from his or her wages that he or she otherwise might not be able to afford. The employer then submits the deducted premiums to the insurance company on a regular basis on behalf of the covered employee. The only cost you may incur is the added time involved during the payroll/accounting process of making deductions. However, the increase of good will with your employees may far outweigh the small additional costs.
Retirement and pension plans The Social Security system provides significant retirement benefits for most American workers. However, from its inception, the government's program was never intended to serve as an individual's sole means of support after retirement. Recognizing the importance of retirement planning, the U.S. government established employer-sponsored retirement plans, which qualify for favorable federal income-tax treatment, hence the name: qualified retirement plans.
These plans are some of the more costly and complicated to establish for the employees. However, when done correctly, these benefits can aid in retaining quality employees for years to come. When it comes to attracting and keeping good employees, firms without qualified-retirement plans are at a competitive disadvantage to those with these benefits in place.
Before a pension or retirement plan can qualify for tax-favored treatment, it must meet some basic requirements: * The employer must establish the plan in writing and must communicate its guidelines to the employees. * The plan must be for the exclusive benefit of employees and their beneficiaries. * The plan must be permanent. * The plan can not discriminate in favor of highly paid employees. * The plan must adhere to rules regarding contribution and benefits limits.
Due to the sometimes-complex nature of pension plans and the vast array of plans available, we cannot cover them here in detail. However, an accountant can be a great source for referrals in finding a quality supplier of the various options of plans available.
As your company continues to grow and attract new customers, it will need key employees to provide the needed services to maintain the company's customer base. With the economy at a healthy level and unemployment at or near record lows, the base of perspective employees tends to decline. These economic conditions make it even more difficult to recruit and retain quality employees. If a company doesn't offer benefits, it will not be able to stay competitive in today's business world.
David G. Gaines is president of Cavalier Asset Management. The St. Louis-based firm provides employee benefits, estate planning and investment to owners of small businesses and individuals.
Want to use this article? Click here for options!
© 2016 Penton Media Inc.