Small businesses certainly face struggles that large multinational corporations do not. As a small business owner, you don’t have unlimited resources to spend anywhere you wish on a whim. Every small amount of money you do spend must be done strategically and every cost should be accounted for. However, there are certain things workers, as well as the government, demand from employers these days. This includes worker benefits. Many small business owners may not know how to keep up with benefits packages and stay afloat as a company. With that in mind, here is some information that can help.
Know What Benefits You Must Supply by Law
First, you should be aware that the law actually mandates certain employee benefits be provided. According to the Small Business Administration, this includes things like unemployment insurance, workers compensation, disability insurance, family leave, and medical leave. Make sure you are doing what you’re supposed to or you could get into legal trouble. You must also deduct money from workers’ pay and make your own contributions towards Social Security for your employees. After the implementation of the Affordable Care Act, employers must also supply health insurance for employees under certain circumstances. If you have over 50 employees, you must provide them with health insurance either privately or though the government’s system put in place by the law.
Know What Benefits Your Competitors Supply
There are of course very good reasons to supply employee benefits other than simply conforming to government mandates. In many industries, benefits are used as a means to attract top talent. If you don’t offer certain benefits, you could lose a good portion of the job market to employers who are more generous to their employees. So one good way to stay on top of what benefits you should offer is to stay on top of what benefits your direct competitors offer.
For a small business, this can difficult. You probably can’t afford everything that much larger competitors offer their employees. However, you should make some effort. In some cases, this may be obtaining cheaper dental and vision coverage available through the healthcare marketplace, as opposed to the more expensive plans bought on the open market by competitors. It may even be bringing in take-out or delivery food instead of opening a company food court. Whatever the case, you need to keep employees satisfied or they will probably eventually migrate to greener pastures with your competitors.
Implement a Financial Service Company
Overall, supplying benefits to employees can be complicated. Small business owners may be going in over their heads trying to address all the complex intricacies and legal requirements of supplying benefits to employees on their own. In this scenario, it may be best to hire a financial service company to help you craft a benefits plan appropriate for your workforce. This way, a lot of the question marks will be removed by professionals. You’ll also be able to focus on things more related to your core product or service you provide to customers.
Do a Cost Benefit Analysis
Like anything, benefits should only be provided if they produce a net profit for the company. For benefits not required by law, you should do a cost benefit analysis to decide which of them you should offer. This should require examining the market and what value employees who demand more benefits can add to your firm in terms of work done and competitive advantage. It should also include an examination of training costs if not offering such benefits produces higher turnover. Offering something for no reason of course is never a sound business decision.
Benefits are important. However, deciding exactly what benefits you should offer your workers can be complicated. Managing them can be even more complicated. Do the proper amount of research and don’t be afraid to ask an outside firm like Fisher Investments for help when you create a benefits plan for your workers. When the time comes, you’ll be better equipped to handle these parts of business.