A benefits plan can be more than just an expense. A custom employee benefits plan can actually be designed to achieve specific results. Well-structured benefits plans allow organizations, regardless of size, to reward key employees, control costs, reduce benefits abuse, and more.
Here are some of the ways to use your custom benefits plan as a business tool:
1. Support Your Compensation and Retention Philosophy
Your compensation philosophy is a strategic decision about how to position your business in the marketplace. As an integral part of your total compensation, your benefits plan should be built to match your compensation philosophy.
You can use your benefits plan to reward loyalty with increasing benefits over time. Or, you can reward success with increasing benefits instead of taxable cash bonuses.
Organizations relying on part-time or seasonal employees can provide benefits based on cumulative hours worked over a period of time. This can encourage experienced seasonal employees to return year after year, reducing training and hiring costs.
2. Eliminate Budget Surprises
Traditional benefits plan renewals often include sudden cost increases. Bad financial news is never welcome, and smaller employers especially may find it difficult to absorb a large increase.
Benefits plan costs, like other business expenses, can be budgeted for to avoid an unexpected increase at renewal. A budgeted administrative services only (ASO) plan from The Benefits Trust, for example, provides employers with a monthly financial statement confirming the surplus or deficit status of their plan. This eliminates the annual renewal surprise.
If a budgeted ASO plan begins to accumulate a deficit, employers can take steps to gradually increase contributions – in a time frame that the business can manage. Alternatively, the business could make changes to the benefits coverage to control claims costs.
Any surplus accumulated in a budgeted ASO plan can be refunded at the most effective point in the company’s fiscal year, or can be applied over time to reduce monthly contributions.
3. Gain Insight into Divisional Performance
Benefits claims can highlight other aspects of the business, providing insights that employers can learn from and use to help make strategic decisions. Different divisions within the business may have dramatically differing claims costs, that when analyzed can highlight other areas of concern.
For instance, sharp increases in claims experience within a division could indicate a deeper issue in workplace health and safety, morale, leadership, or occupational training. These factors can be addressed by management when they have a complete picture.
While benefits plan providers must maintain individual employees’ privacy, aggregate claim reports can provide a valuable piece of the puzzle for employers trying to understand divisional differences in costs and performance.
The primary advantage of a custom employee benefits plan is that the right employees have the right benefits at the right time. There are many ways to build a benefits plan to target compensation, retention, cost, and performance goals.
Use your benefits plan as a tool, and make reaching your strategic goals that much easier.
The Benefits Trust specializes in designing custom benefits plans. Let us help you build a better benefits plan that meets your specific needs. Contact us today to get started!
Seasonal Employees: Yes You Can Give Them Benefits (And This Is Why You Should)Aligning Your Benefits Plan with Your Corporate Compensation Philosophy
Introducing the SelectFlex Benefits Plan: A Simple Solution for Small Businesses
Image courtesy of: benefitscanada.com
- Case Study: Reflecting Your Company Culture in Your Benefits Plan - May 21, 2020
- Case Study: Addressing Employee Demands for More Benefit Choices in Family Owned Business - February 21, 2020
- Changes Coming to OHIP in 2020 - November 26, 2019
- Canadian Businesses Turning to Flexible Benefits Plans - October 7, 2019
- Common Benefits Advisor Problems: Adding Value, Part Three - June 6, 2019
- Common Benefits Advisor Problems: Adding Value, Part Two - May 14, 2019
- Dental Fees in Ontario Rising 4.19% This Year: What Can You Do? - March 22, 2019
- How to Combat the Skyrocketing Cost of Dental Claims - October 24, 2018
- Virtual Care in Canada, Here to Stay! - September 18, 2018
- Rob Crowder Celebrates 30 Years in the Business! - August 17, 2018