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Employers understand that hiring and retaining top talent requires the right combination of salary and non-wage compensation programs. Recent surveys show that getting this combination right matters.
Three out of five job seekers consider benefits as a major factor when choosing a new employer.(1)
Two out of five employees would seek a different job for better benefits.(2)
Over two-thirds of employees feel more loyal to a company with better benefits.(3)
But with so many potential employee benefits to offer, the task becomes determining which employee benefits matter and provide the highest return on investment (ROI).
What you can offer
While there are many different employee benefits, they can easily be divided into three main categories:
The required category contains benefits required by national and state laws. These include such things as paying at least minimum wage and overtime pay.
The expected category are those benefits that employees have come to expect. For most employees, this includes some kind of health care option and vacation pay.
It’s the final category, the bonus benefits, that could determine the quality of applicants for open positions and determine the longevity of those hired.
Do your employees and future employees want life insurance? Pet insurance? Mileage reimbursement? Continuing education? One recent report suggests that employees want benefits that impact their quality of life in a meaningful way. At the same time, employers want to add benefits that bring in the greatest ROI.(4)
To make the decision easier, here are five “bonus benefits” that employees want and provide a great ROI to employers.
#5 Tuition Reimbursement
The student loan crisis continues to be a hot topic, especially for millennial and GenZ employees. The latest statistics from the U.S. Department of Education show that 42.3 million Americans have accrued
$1.55 billion in student loan debt. (5) Undoubtedly, most companies employ those struggling with this debt, which is why tuition reimbursement programs are gaining popularity.
Tuition reimbursement helps employees continue their education without taking on further debt by paying tuition. Most programs of this type require the employee to pay for the classes upfront, getting reimbursed when the class has been successfully completed.
Accenture determined that the ROI of Cigna’s tuition reimbursement program was 129 percent.(6)
#4 Mental Health Benefits
In addition to health benefits, many employees specifically want mental health benefits that deal with their psychological and emotional well-being. Such programs focus on employee stress, interpersonal
relationships both in the workplace and at home, and making wise choices.
The most popular mental health benefits include:(7)
Mental health coverage as part of the health care coverage plan
Mental health risk assessments
Mental health educational sessions
The best thing about offering mental health benefits is that the return on investment grows over time. Deloitte found that in the first year, the ROI for such benefits was 162 percent. However, after three years, this increased to 218 percent.(8)
#3 Allowing Telecommuting and Flex-Time
Employees want the ability to enjoy their lives and their families, which is why the trend toward remote work has been growing. Between 2005 and 2017, remote work increased by 159 percent.(9) In fact, an IWG study shows that 83 percent of job seekers would turn down a job that didn’t offer some kind of flexible schedule.(10)
Thankfully, doing so is great for an employer’s bottom line. AARP found that offering flex-time alternatives provides an ROI of 170 to 434 percent, while telecommuting’s ROI is between 246 and 445 percent.(11)
#2 Health Well-being Programs
Employees don’t just want health insurance for when they are sick. They want their employers to help them stay well.
Health well-being programs help employees with such things as:
Studies show that offering health well-being programs reduces medical costs and absenteeism, bringing such programs’ ROI to 600 percent.(12)
#1 Financial Well-being Programs
Financial well-being programs help employees gain an understanding of their finances, above and beyond employer-sponsored retirement programs.
The highest ROI for financial well-being programs comes from those that offer a holistic program to employees covering all aspects of financial education, including:
Student loan reduction
Understanding personal financial attitudes
Financial crisis management
Data from Enrich(13) shows that employees who participate in the financial well-being program show positive behaviors like:
Increasing their savings.
Paying off their credit cards faster.
Contributing more to their employer-sponsored retirement plan.
In the whitepaper, “Calculating the ROI for Employee Financial Well-being,” the ROI of an employee financial well-being program is calculated at 1500 percent or more due to increased productivity, 401(k) participation, and on-time retirement, as well as decreased absenteeism, HR administrative costs, payroll taxes, health care premiums, workplace accidents, and employee turnover.(14)
By considering these five benefits, employers can increase current employees' satisfaction and hire strong candidates for open positions— all while improving the bottom line.