Why Employee Benefits Are Important To Retain Your Workforce
Why are employee benefits important? Since the great resignation of 2021, employees have become significantly more selective about the type of packages they accept from a new employer. Likewise, organisations also realise the impact of low engagement and retention rates on productivity in the workplace.
Many companies now focus on providing a better range of affordable employee benefits. They understand that top-tier talent is in high demand and can pick and choose from job offers with the best packages, and a high salary is no longer the ultimate goal.
Summary: Top 20 Popular Employee Benefits
- College grants and scholarships
- Paid training and development
- Travel and spending expenses
- Unemployment insurance
- Investment opportunities
- Student loan repayment
- Paid time off / holidays
- Remote work flexibility
- Life insurance policies
- Performance Bonuses
- Mental health support
- Company equipment
- Retirement planning
- Wellness Programs
- Disability benefits
- Company vehicle
- Medical benefits
- Extended leave
- Paid sick leave
- Family Leave
Pros of Employee Benefits
- Attract top-tier talent
- Offer better benefits than the competition
- Happier employees: Increase retention rates
- Develop a reputation as an employer that values its staff
Cons of Employee Benefits
- Difficult to know what benefits employees want the most
- Can be costly
- Challenging for startups to provide sufficient benefits
- Employees could take advantage of some benefits
- What are Employee Benefits?
- Why are Employee Benefits Important?
- What are Flexible Benefits?
- Top 20 Employee Benefits
- #1: College Grants and Scholarships
- #2: Paid Training and Development
- #3: Travel and Spending Expenses
- #4: Unemployment Insurance
- #5: Investment Opportunities
- #6: Student Loan Repayment
- #7: Paid Time Off / Holidays
- #8: Remote Work Flexibility
- #9: Life Insurance Policies
- #10: Performance Bonuses
- #11: Mental Health Support
- #12: Company Equipment
- #13: Retirement Planning
- #14: Wellness Programs
- #15: Disability Benefits
- #16: Company Vehicle
- It’s usual for external sales teams to have a company vehicle. Organisations also provide a company vehicle to employees during work time, such as mail delivery, couriers, construction workers etc.
- #17: Medical Benefits / Health Insurance
- #18: Extended Leave
- #19: Paid Sick Leave
- #20: Family Leave
- The Pros of Employee Benefits
- The Cons of Employee Benefits
- Conclusion: Why Employee Benefits Are Important To Retain Your Workforce
What are Employee Benefits?
Employee benefits are additional compensation offered to an organisation’s staff alongside a salary. In most cases, companies can choose what benefits to provide, but certain benefits may be mandatory in some U.S. states, such as health insurance, retirement plans and paid holiday.
Why are Employee Benefits Important?
Web3 is a highly competitive market with demand for top talent exceeding the supply. Therefore, skilled individuals can choose an employer offering the most attractive benefits package and salary offer.
After the disruption of the COVID-19 pandemic in 2020, employees voted with their feet, choosing employment that offered a better work-life balance. As many people worked from home for most of 2020, employees developed a taste for flexible and remote working. They got more time with their families without the daily commute, and, in reality, there was no going back.
The great resignation began in 2021 when organisations demanded workers return to the office. But that decision backfired when 47.8 million people worldwide quit their jobs, and it didn’t stop there because, in 2022, over 50 million resigned from the global workforce (Source: CNBC).
Many employees decided enough was enough, and millennials were top of the list. They no longer accepted poor treatment by employers and left for better jobs where they felt more valued. Typical reasons for employees moving on were to seek better employee benefits, such as remote work, better salary and career prospects.
Why Should a Company Offer Better Employee Benefit Packages?
Companies with exceptional employee benefits attract candidates of a high standard, employees seeking job satisfaction, and improved health and well-being (including mental health). These candidates are actively deciding which companies they want to work with and consider the quality of a benefits package when deciding between multiple job offers.
EBRI research discovered that 78% of employees said an excellent employee benefits package would influence their decision about accepting a job offer. In other studies, 69% of employees would choose an employer over another if the organisation offered better employee benefits, and 75% of employees stated they are likely to stay with an employer offering an employee benefits package (Source: employeebenefits.co.uk.
If you’re an organisation considering improving employee benefits, here are a few things to think about what employees want before choosing the range of benefits to add to an employee package.
Benefits that potentially improve an employee’s life add to job satisfaction and make them feel valued, such as: –
- Paid sick and holiday leave
- Extended and compassionate leave
- Maternity leave for all genders
- Well-being programs
- CPD options
- Remote and flexible working
Employees who are happy at work are more productive and loyal to an employer. Engagement and retention rates increase when staff feel motivated, and performance standards are likely higher. It can improve the workplace culture and lead to a more cohesive and stable environment.
Improved Work-Life Balance
Stress and mental health issues are increasing. As individuals struggle to navigate the financial challenges of high inflation and rising childcare costs and utilities, stress spills over into the workplace.
Employee benefits that address employee stress are becoming super important to employees. Wellness programs, remote and flexible working, paid time off, or extended leave go a long way to preventing employee burnout.
Choose those benefits that target work-life balance, and you will have a loyal and more productive workforce.
In addition, sometimes, organisations offer employees a flexible benefits scheme to provide options instead of a mandatory benefits package.
Learn why employee benefits are important
What are Flexible Benefits?
Employees have individual needs and enjoy flexible benefit schemes because they can choose the most appropriate. For organisations, a flexible benefits plan with multiple options helps to encompass all genders, ages and requirements. For example, a twenty-year-old graduate will choose different benefits from a 36-year-old mum or a 55-year-old executive.
How an organisation sets up a flexible benefit plan will vary. In most instances, employees contribute to the cost of flexible benefits through their salary (before tax deductions). That’s another employee benefit, as it lowers the taxable income.
The employer sets the cost of the flexible benefits scheme with flexible choices for the employee, such as private healthcare, gym membership, dental plans, and cycle-to-work flexible benefit schemes.
Top 20 Employee Benefits
#1: College Grants and Scholarships
Many organisations have developed scholarship programs. It’s an excellent benefit for employees to gain additional skills that benefit the company, such as finishing a degree or returning to school. Your company can determine how they sponsor a program and how much they contribute.
#2: Paid Training and Development
Continuous professional development (CPD) on a resume shows an employer that candidates are committed to improving their skills to bring value into the workplace. CPD courses can be expensive, so it is an excellent perk for an organisation to offer employees as part of a benefits package.
It can also help attract candidates with potential that could be excellent employees with a bit more training. Offer a budget for CPD-certificated training, and if the course is off-site, also offer paid leave to attend the training.
#3: Travel and Spending Expenses
If your employees must travel to complete business tasks, the employers must cover these costs, such as transportation expenses. If an employee travels long distances, employers pay hotel costs, including meals and other out-of-pocket expenses.
Unless a budget is assigned, employers pay the upfront costs and later claim the expenses from the company.
#4: Unemployment Insurance
Many organisations worldwide have made unexpected redundancies in 2022 and 2023, leaving even the most valued employees without a job. Unemployment is a constant worry for employees, as most have no savings and are only a month or so away from not having enough money to pay their bills.
Unemployment insurance guarantees that employees receive a percentage of their salary if they are made redundant. That provides breathing space as they search for a new job.
#5: Investment Opportunities
Organisations can offer employees stock options in their company, enabling them to invest without the uncertainty and cost of selecting stocks of their own. If the company does well, the employees benefit, giving them extra incentives for working productively to help the company grow its market share.
#6: Student Loan Repayment
Some employers offer student loan repayment benefits for recent graduates to the company. The employer agrees to pay a fixed monthly contribution, which can vary depending on the total sum of the student loan.
#7: Paid Time Off / Holidays
Not all organisations offer paid time off, but employees are more attracted to work for those that do.
Paid time off, or paid holiday means that the company continue paying the employee when they are off work for holidays and bank holidays such as Christmas and Easter.
Employees can accrue paid time off (PTO) and save it for a more extended holiday period.
#8: Remote Work Flexibility
Hybrid or remote working became the norm during the COVID pandemic, and employees enjoyed the flexibility. Since 2020, most organisations have offered their employees flexible or remote working.
Some companies allow employees to choose their hours and work days from home. This perk enables employees to manage work/life balance and take a break from the distractions of office work.
#9: Life Insurance Policies
Life insurance is one of the most common benefits for employees. These policies are usually group-term plans, which means they are usually more cost-effective than individual life insurance policies. Employee policies will remain active if the company holds the group plan and the individual is still an employee.
#10: Performance Bonuses
Performance-related bonuses are excellent incentives for employees to improve their productivity. Benefits could be a salary increase, commissions or other bonuses if an employee meets predetermined targets.
Companies often underestimate the benefits of providing performance incentives. Primarily, it’s a benefit relating to an employee feeling valued and appreciated. The money is a bonus, but recognition from management for their efforts is a psychological boost.
#11: Mental Health Support
The COVID pandemic created worldwide stress of navigating a collapsing society. People struggled to manage so much change at home and in the workplace. Mental health issues became prevalent and a cause of concern for employers.
Some organisations provide insurance that covers emotional well-being and mental health. It enables staff to seek help from mental health professionals such as counsellors, psychotherapists, and cognitive behavioural and grief therapists.
Providing mental health insurance may seem an unnecessary expense. Still, it can be cost-effective by helping employees to stay at work and remain productive instead of time off sick with mental health issues.
#12: Company Equipment
Employers often supply equipment to employees, such as: –
- Laptop, Mac or PC
- Mobile phone
The purpose of the company equipment is to help the employee do their job. If they subsequently leave the company, employees must return the equipment.
#13: Retirement Planning
Retirement plans vary depending on global location. For example, many United States Companies offer a 401(k) as a benefit, which is a profit-sharing plan. On acceptance, employees can contribute from their salaries, and the organisation usually matches the amount.
#14: Wellness Programs
Many organisations are providing wellness benefits for psychological and physical benefits as part of employee well-being and mental health. It could include stress management or relaxation sessions, yoga, Tai Chi, massage, counselling or coaching, and some companies create a gymnasium or sleep pods.
#15: Disability Benefits
If an employee sustains an injury or develops an illness that prevents them from working, disability benefits provide income support. A long-term disability package reassures employees of receiving a percentage of their salary until they can return to work.
#16: Company Vehicle
It’s usual for external sales teams to have a company vehicle. Organisations also provide a company vehicle to employees during work time, such as mail delivery, couriers, construction workers etc.
#17: Medical Benefits / Health Insurance
Depending on the level of private health insurance, a basic policy typically covers things like medical and sometimes surgical procedures, health checkups, and doctor’s appointments.
#18: Extended Leave
There are times in an employee’s working life when they may need extended leave for various reasons. Employers can offer extended leave as a benefit whereby they continue paying the employee’s salary if they are away from work for more than fifteen consecutive days.
#19: Paid Sick Leave
Paid sick leave is typically a standard employee benefit with various allowances depending on the company. For example, some organisations may pay employees 100% of their salary for the first six months and 50% of their pay for the following six months.
#20: Family Leave
Family leave includes maternity and paternity leave for new mothers and fathers before and after the birth of their child. Family leave is becoming a popular employee benefit, and more companies are adding it to their employee benefits packages.
Employees may be paid family leave for up to three months off work, depending on the organisation.
The Pros of Employee Benefits
Attract Top-Tier Talent
We can confirm that organisations with excellent employee benefits packages attract the best talent.
Offer Better Benefits Than The Competition
Is your competition grabbing the top talent, and if so, why? A quick soiree into their employee benefits packages may reveal the truth.
Happier Employees: Increase Retention Rates
We are living in unsettled and uncertain times. Employees worry about losing their jobs or what would happen if they or a family member became sick. Employees experiencing anxiety do not work to their optimum performance levels, and when dissatisfied, they aren’t happy at work.
We can argue about the meaning of “happy“. Still, let’s accept that employees who feel appreciated and “safe” at work are happier than those worrying about losing their jobs, struggling with a toxic work environment, or driving to the office five days a week when they could work better at home.
Develop A Reputation As An Employer That Values Its Staff
An organisation’s negative reputation spreads faster than a positive reputation. Web3 is a highly connected industry; we all know companies we’d never want to work with.
For example, suppose Mike asks his manager for paid time off because his wife must undergo chemotherapy, and he wants to be with her for support. His manager denies his request.
Mike now has two choices. He lets his wife attend chemotherapy sessions alone, or he takes time off without pay. Either decision, Mike is disheartened by the lack of empathy. He contacts a recruitment agency to ask for help finding a new job with an organisation that is more compassionate towards its employees.
The Cons of Employee Benefits
Difficult To Know What Benefits Employees Want The Most
It’s genuinely not that challenging to discover what employees want. You can ask the workforce and present the question to interview attendees. In this article, we’ve covered the top twenty employee benefits, so handpick those that apply to your workforce.
Can Be Costly
Ultimately, having poor employee benefits can be more costly than having a good range of benefits. If you have a limited budget, start with the basics and add more benefits as the company grows.
Challenging For Startups To Provide Sufficient Benefits
The answer to this challenge is the same as the one above. Start with the basics. If someone joins your startup as an employee, they will likely understand the limited budget during the growth period. Be honest and explain to applicants that the company will offer more benefits when the budget permits.
Employees Could Take Advantage Of Some Benefits
Employees can misuse paid time off, sick leave, or family leave. Unfortunately, there’s always one person who takes advantage. Still, generally, most employees appreciate the benefits and do not take advantage. If the hiring manager has done a good job with background checks and references, you’ll hire people with integrity and an honest approach to their work with your organisation.
Conclusion: Why Employee Benefits Are Important To Retain Your Workforce
Why should your organisation offer better employee benefits than the competition? In the Web3 space, there aren’t enough skilled candidates for the jobs on offer. Several hundred people may apply for the same position, but ATS software or a hiring manager will reject 95% of applications.
Finding top-tier talent for Web3 careers is no easy task. The best individuals have a clear picture of what they want from an employer, and if the employee benefits package is lacking, they look elsewhere.
Organisations with the best employee benefits see increased employee engagement and retention, which means productivity is higher and workplace disruption is minimised.
The media suggests that, in 2023, organisations will strive to reduce hybrid and remote working, but we think that would be a mistake, certainly in the Web3 space.
Provide the best employee benefits possible, and your organisation will benefit from a happier workforce.
Contact the CB recruitment team to discuss your hiring needs.
Jan is a SEO copywriter, brand advisor, content strategist & case study specialist writing for crypto, recruitment, and SaaS companies. Jan lives in the Cotswold's UK with two rescue dogs. Since 2020, Jan has written hundreds of SEO articles for various crypto companies including CB Recruitment & Coin Bureau.
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