IMHO: The Role of Benefits in Employee Retention

IMHO: The Role of Benefits in Employee Retention

The perspective for this article is that of someone who is almost 62 and has experienced seven employers in her lifetime. If you’re a business owner who has struggled with employee retention, I think you’ll want to hear how flexible financial and non-financial benefit packages can reduce employee turnover in your business—saving you money in training expenses, not to mention lost momentum.

How do you create a benefits package that speaks to your company’s culture, encourages employees to think like owners, and helps you successfully retain quality staff? It’s not that hard: just ask your employees what they want from their career at your company. I am willing to bet you’ll learn about benefits you can provide at minimal or even no cost that makes your team members feel positive about their role and contribution to your company. As a result, they will want to continue growing and learning, which ultimately leads to retention—and better outcomes for your business.

As a successful owner, you know your industry and the skill sets necessary to run your business. Keep in mind that some employees want to be challenged to grow and experience new and more responsibilities, while others love being the little engine who chugs along reliably and dependably with routine tasks. You need both types of employees, and a flexible benefits package can attract and impact both. Because your employees aren’t all the same, it just stands to reason that you should offer a plan with the flexibility required to appeal to different types of workers.

When I began my career path in 1983, my benefits package included group health and life insurance, vacation, sick leave, and holiday pay: pretty much the run-of-the-mill, all of their financial benefits. Fast-forward to 2022, and my benefits package is much more comprehensive, including both financial and non-financial components. I’m much more satisfied as a result, which makes me a firm believer that if you invest in your employees, they’ll hold on for the ride.

Let’s address financial benefits first. I asked a few human resource managers and employee benefit insurance providers what they’re seeing in the market, and for the most part, it’s the traditional group health, life, disability, dental, and/or vision insurance coverages, voluntary insurance coverages, flexible spending accounts, health savings accounts and a retirement plan with an employer match and/or a discretionary profit-sharing contribution. Vacation, sick/personal days, and paid holiday benefits are equally important too. Every human needs time to unplug from their work schedule and responsibilities to recharge and reenergize their minds and bodies.

But when employees are slaves to their jobs with little to no work/life balance, this causes fatigue, burnout, and ultimately turnover. I remember working 70–80 hours per week in public accounting during tax season in the early ’80s. My husband got us tickets to Cleveland’s Gund Arena to watch the Bulls play the Cavs because we were both huge Michael Jordan fans. But I missed everything after the national anthem because I fell asleep on my husband’s shoulder from exhaustion. That convinced me I would never last long in that industry, and a few years later I left public accounting. I’m told the industry is much different now; I sure hope so.

Here are a few more financial benefits you might not have thought about. How about legal fees or pet insurance policies; paid funeral leave or parental leave policies; voting day/jury duty/National Guard or military reserve duty policies; cellphone reimbursement; gym memberships; or uniform or work clothing allowances? Consider providing education, software or skills training, or an industry conference attendance allowance that better prepares your employees for new responsibilities. Put your money where your mouth is and develop an incentive compensation plan to reward measurable behaviors that support your growth, efficiency, or profitability objectives. In other words, reward results.

Now, let’s move on to non-financial benefits. This is the area that holds some of the most exciting developments I’ve seen and experienced over the years. Start by creating a vision for your company and sharing it with your employees, along with your growth objectives. After all, organizational transparency builds trust. Hold regular feedback sessions or open forum discussions to solve issues, and follow through. Ask for suggestions and establish employee growth paths as your industry warrants. Provide periodic communication throughout the year, genuinely asking your employees what is going well and what isn’t. By finding out what matters to them and acting on the issues—or explaining any inaction and giving a timeframe for follow-up—you build trust. Create a mentorship program to onboard and train newbies to hit the ground running. Lastly, consider remote or hybrid working arrangements, flexible hours, or longer workdays combined with shorter work weeks. These can all contribute to work/life balance in this crazy world and also create a culture of inclusion. When you give more, you get more. Remember: when you invest in your employees, their health and successes become your company’s health and successes.

I always drilled into our children, “Find a job you truly love and are passionate about, and you’ll never have to work a day in your life. And if you get paid for it, that’s icing on the cake.” I have seen employee benefits packages change drastically since my time with my first employer, and the change has been all for the good. To retain the best of the best, you need to ask, listen, and build a package of benefits that are important to your employee base. To quote my husband, “I work to play.” I believe that no matter what their education and skill sets are, most people desire a rewarding work environment they’re passionate about one that enables them to earn a decent living, support their lifestyle, and yes, play. If holding onto the best of the best is the trick that puts your business ahead, then it makes sense to research your industry and job market and thoughtfully draft a respectable benefits package unique to your employment needs. But don’t stop at the traditional financial benefits; incorporate the nonfinancial benefits, too.

Do you want your work environment to be creative, collaborative, and accountable? Would you like your employees to hop out of bed every day and give 100% to a job that fulfills them? Wouldn’t you like to eliminate any desire for a valued team member to move on to the next employer? Well, when you show your workforce you believe in them and want them to embrace their role, and when you support them by sharing your vision and growth objectives along with holding periodic and consistent open forums, feedback, and “what matters” conversations, I truly believe good results are forthcoming.

Growing a business with a culture of learning, sharing, and embracing accountability takes time and effort. Do your homework, draft a thoughtful benefits package, dive deep into the benefits side to be competitive with your industry, and dive even deeper into the non-financial benefits to support a culture that rewards and retains high-performing people. I believe these non-financial benefits can be the icing on the cake—and help your business get a bigger piece of the pie!

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Deborah A. Stiger

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