Why are employee benefits important today?
Numerous studies show that the provision of good employee benefits correlates with employee motivation and productivity. People work well when motivated to do so – and some of that comes from intrinsic benefits such as a feeling of achievement and self growth, and some from external benefits, like performance awards. Many employee benefits sit somewhere in the middle – they’re not usually tied to performance, although some can be, but act as a motivator as they make people feel valued, part of a team, and supported.
A good employee benefits package can attract and retain top candidates and good employees, by making you an employer of choice. One survey from Forbes Advisor found that 40% of employers report that workers leave their job to find a role that offers better employee benefits. They also found that one in 10 workers would take a pay cut to have access to better benefits. Communicating a comprehensive benefits package in your job advertisements can make people more likely to choose you over a similar firm – and crucially, backing up that advert with reality will help employers retain talented employees. When employee satisfaction increases, not only do retention levels, but productivity, making it good for business as well as employees.
Employee benefits directly contribute to employee satisfaction, engagement, productivity, and loyalty. They communicate to employees that their employer cares for their wellbeing, their professional development, and their happiness. This in turn helps boost productivity, retain employees, and reduce employee turnover.
So if you’re looking to start or revamp your employee benefits packages what should you be considering?
The top 7 benefits for employees
1. Life and health insurance
One typical employee benefit as part of a compensation package is life and health insurance. At a time when health services are overstretched in many countries, providing comprehensive medical insurance coverage ensures that employees can access quality healthcare when needed, mitigating financial stress during such challenging times. This is particularly important in the US, where universal healthcare is not a state benefit, unlike in the UK. Medical coverage and disability insurance are some of those more traditional benefits that employees value.
Life insurance is provided to around 57% of private employees, according to the US Department of Labor. It reassures employees that their families will be financially protected if they were to pass away unexpectedly.
It’s not only people that we care about. That same Forbes study found that a third of 18–41-year-olds are most concerned with having pet insurance available as a benefit. Think about what matters most to your employees and try to provide the things that are most meaningful to them.
2. Pension & retirement plans
At some point we all leave the workforce. Financial management in our older years can be tricky, without a regular income. Workplace pensions are arranged via an employer, and employee contributions are usually matched by them, so they are a great way to get a savings boost. The Employee Benefits Security Administration of the Department of Labor is responsible for administering and enforcing the provisions of Employee Retirement Income Security Act, and covers most workplace pensions, for reassurance. Just over two thirds of US employees have access to employer pensions, so there is definitely more work to be done. As an adjunct to this, financial wellness programs can also be of benefit, so that people know how to manage their money better.
3. Paid time off
Statutory paid time off, or holiday or annual leave varies around the world. In the US it’s only 10 days, compared to 28 days in the UK. However, many employers offer more than this. The reason is that it’s good for people. Working long hours in a stressful environment leads to mental health problems and burnout. The result is often long term absenteeism – which is more costly and difficult for an employer to manage, and has a ripple effect throughout the organisation as other team members have to adjust to an increased workload. Giving people paid time off so that they can recharge and rejuvenate is good for everyone.
This could be paid parental leave, mental health days, or simply paid vacation.
4. Mental health support services
Given that four in ten employees suffer anxiety and depression, and half haven’t spoken to a professional about it, employers are in a strong place to support employees with their mental health.
Providing powerful and effective mental health support services starts with understanding what your employees need. Wysa’s completely anonymous, company-wide digital screening tool – The Employee Mental Health Barometer – gives employers insights into current levels of anxiety and depression within your organization, without requiring individuals to feel exposed in sharing their personal problems. This then gives you a baseline and understanding so that you can provide the level of support that is needed.
Wysa for employers gives immediate support as the first step of care, and human coaching for those who need more. Currently less than 7% access employee assistance programs due to stigma, lack of awareness and time constraints. Yet while talking to Wysa, 42% of employees opened up about their declining mental health, and 9 in 10 find the app helpful. It’s not only good for employees, but for business – every year, unaddressed depression and anxiety cost $580 per employee in absenteeism, lost productivity and turnover.
Wysa’s offering includes AI therapy, coaching services, self help packs, webinars and workshops, providing a comprehensive suite of wellbeing tools to help with mental health.
5. Employee rewards and discounts
There are a number of providers who offer schemes where eligible employees can access rewards and discounts. These can often be tailored to specific needs, such as reduced gym memberships, travel discounts, or even now with the cost-of-living crisis, money off essentials such as food shopping. To ensure that incentivizing isn’t happening from the top down many schemes offer peer-to-peer recognition, which can also feel more validating as the acknowledgement is coming from peers. Given that financial stress is a strong predicator of poor wellbeing, employee discounts can be really beneficial and welcome.
6. Flexible hours
At the moment flexible working sits in the benefit category, although there are moves to make it more of a ‘right’ and in the UK all employees can request flexible working from their first day. By allowing people to choose where and when they work, often with core hours of crossover with their teams and peers, you make it easier for them to manage work life balance, caring responsibilities, and wellbeing. With the growth in hybrid working, accelerated by the Covid-19 pandemic, more and more employers are recognising that they don’t need to be limited by geography or timezones, and can get the best talent – and the best out of that talent – with some flexibility. However, it is important to still keep dispersed teams included through virtual wellness activities.
7. Career development and growth opportunities
Essential to getting the best out of people is providing with training and support for professional and career development. A comprehensive learning and development programme can help employers set themselves apart and attract and retain great people. Employers should offer both structured in house training and tuition reimbursement for external courses or schemes, so that employees get a number of different types of training for their professional development. Tuition assistance also includes providing time off for training. Career development correlates with wellbeing, and clearly results in better productivity and performance, as employees are better able to tackle their tasks. It also helps improve employee retention, as employers feel that their employee is invested in their long term career and progress, and that they are in the right place to achieve their aims. When you retain great people you are also creating the next realm of leaders, who understand and are invested in your company.
Other popular employee benefits being offered today
As well as the traditional employee benefits the new working world has seen a rise in other popular benefits and perks.
8. Shorter weeks (4 day work weeks)
There are trials underway to see if shorter weeks could be good for both employers and employees, with early outcomes proving to be positive. Although in some businesses compressed hours are the norm – e.g. 4×10 rather than 5×8 hours but the four day week movement is about reducing hours altogether – and getting the same work done. The idea comes from the fact that we spend a lot of time at work doing menial tasks, chatting with colleagues, getting distracted, or just being tired, and a more effective and focused way of working would be better for everyone. Given that the majority of firms who trialled the shorter working week in the UK have chosen to extend it, this could be something that becomes more common.
9. Unlimited leaves
The idea of unlimited leave is that employers can request paid time off (although employers can still refuse it) at any time, even above the usual given amount. It has been shown to not result in long absences, as people still have commitments to keep, tasks to do, and projects to fulfil. The Society for Human Resource Management has shown that generous vacation plans are in high demand, and unlimited leave is an extension of this that could be very attractive.
10. Work from home setup stipends
Working from home can result in physical health problems such as bad back or neck ache, as often the home office set up is not as good as in the office. By providing stipends so people can buy ergonomic chairs, a second screen, and adjustable desks for example employers can help support physical wellbeing.
11. Sabbaticals
Taking a longer period of time off, or a sabbatical, can be great for employers and employees. Employees will return rejuvenated and with renewed energy, will have learned skills and ideas that can help them in the workplace, will be less stressed and more rested, and convinced that their employers do genuinely care about them – and as such they are more likely to stay with the company. The Harvard Business Review reports that organizations benefit when employees take sabbaticals, but despite this only 4 %of U.S. companies offer a paid sabbatical program, whilst just 16% provide an unpaid sabbatical program, according to the Society of Human Resource Management.
12. Mental health app subscriptions
Good employee benefits are available when employees want them. The difficulty with some wellness benefits is that they are at set times or only in work hours, so people can’t access them when most at need. Wysa’s comprehensive employer offering has been proven to work. Wysa has found that 47% employees on average report symptoms of depression at onboarding – but after using the app show reduced depression scores. This suggests that offering everyone conversational AI as the first step of care acts as a preventative, encouraging people to open up much faster and build mental resilience.
The best job benefits are those that employees actually want. The first step to a good plan is to ask what the most popular employee benefits are in your organization, and make the package that your company offers flexible, appropriate, and effective.
