While small-business employers are just as keen on providing the same benefits as their big-business counterparts, a recent Colonial Life study says employers can look at offering competitive voluntary benefits as a way to entice employees and boost employee retention.
While salaries still top the list of maintaining employee loyalty, a majority of employees surveyed still value health and retirement benefits more than most employers believe, the study notes. Nonmedical benefits, however, came in with 44% of employees saying such perks would keep them happy.
Life insurance, short-term disability and critical illness accounted for the majority of voluntary benefits an employee values most. Accordingly, fewer than 20 percent of employees in such small organizations reported having access to those perks.
Small firms that dont offer any benefits say cost comes in as the biggest prohibitive factor, especially for companies with fewer than 10 employees, the study, Small Business: Big Benefits, notes. If benefits must be cut, small companies are more likely to drop the nonmedical insurance benefits.
Voluntary benefits are valuable to employees for a range of reasons, the study says, even if workers shoulder the entire cost. The study adds that group rates, payroll deduction and the prospect of portability make benefits affordable and attractive to some employers.
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While many small businesses dont have the staff to educate and manage benefit enrollments, partnering with vendors can be a viable option, but one that small-business employers must carefully evaluate, the study says. Employers should look for vendors that have had previous experiences with small companies and provide a consultative approach, the study cautions.
Slow economic growth, and the oncoming implementation of mandatory health benefit coverage in 2015 will create new challenges for many small business employers, and the study points out that as employers turn the focus of benefits dollars to the areas of greatest impact, voluntary benefits will provide a means to offer more choices and positively steer employee morale and job satisfaction.
