How Should Small Business Owners Approach Employee Benefits Programs?

Many small business owners are now trying to figure out new ways to ensure that they can attract the best possible candidates for whatever open positions they have, as well as hold on to the top workers they’ve already hired. There are a number of different theories behind the best way to do this, but one in particular that may be gaining momentum in recent years relates to the kinds of secondary benefits companies extend to their workers.

While smaller enterprises may not be able to extend even higher-level employees perks such as more vacation days or larger salaries as a means of drawing them in, they may be able to use more attractive benefits programs that other, potentially larger competitors cannot for some reason, according to a report from Small Business Trends. For instance, these companies in particular may be able to qualify for the Small Business Health Care Tax Credit, which is only available to those which have fewer than 25 employees whose average salaries are no more than $50,000. These may help to cover up to 50 percent of a small business’s health insurance premiums, which may give them greater flexibility to offer more beneficial plans with a larger number of perks.

Further, having the ability to give workers more options than they might be able to find through larger employers is another way in which small businesses can get an edge on hiring and retaining top workers, the report said. Today, close to three in five workers say that if they are offered optional insurance coverage by their employers, they will take it, and having the ability to offer one of several plans to these people may increase their participation because they could feel as though the choices available are better suited to their unique individual needs than the kinds of plans offered by larger companies that would likely be designed to fit the average worker, rather than individuals.

Small businesses need to be more communicative
In addition to being able to potentially offer more flexible and attractive benefits plans to their employees, small businesses also have the ability to more directly deal with those workers when it comes to the programs they offer than their larger counterparts probably are, the report said. Today, only slightly more than one in every four employees say that they feel they understand everything about their benefits, but about 40 percent of workers say that they’d be less likely to leave their jobs if they were able to receive more and better communication about them. For small businesses, that kind of personal touch could be far easier to achieve.

Owners or the small business employees in charge of administering benefits programs may therefore want to do more to regularly talk to their workers about the ways in which these plans can help them most effectively, the report said. This can also be approached a number of ways, including in-person chats, emails, meetings or other tools that are now growing more common for businesses both large and small.

Another way in which owners might be able to provide more benefits or other such perks to their employees is by finding more affordable small business insurance coverage. Reducing costs for common types of policies, such as those for workers’ compensation or liability insurance, may give companies the ability to save thousands of dollars on premiums every year, and in turn devote that money to other parts of their enterprises that may need a little more financial attention, or just add to overall financial flexibility.