Time to Offer Employee Benefits: 6 Telltale Signs of When to Start
By: Benefits by Design | Tuesday August 17, 2021
Offering an employee benefits plan is a significant milestone in any business’s lifespan. It’s one of the signs that takes a small business to the “next level” and positions them positively in the war for talent.
But knowing when it’s time to offer employee benefits isn’t always easy, so we’ve made a list of six telltale signs that your organization is ready for a benefits plan.
#1. You’re in “Growth Mode”
COVID-19 has highlighted the importance of one’s health for Canadians in a big way. Now, more than ever before, prospective employees are looking at employers’ benefits plans carefully, and it has become a significant consideration in whether they take a job.
If you’re looking to grow your business and staff, it’s time to offer an employee benefits plan. Growing businesses will need the best and the brightest employees to maintain that momentum, and a benefits plan is one of the best ways to draw them in.
#2. You’re Having Trouble Hiring
Employee benefits plans keep employees happy and healthy, certainly. However, they also serve as an excellent recruitment tool, attracting and retaining top talent for your organization.
If you’re having trouble hiring new employees (or keeping the ones you recruit) and you don’t have a benefits plan, that may be a factor. Particularly if other businesses in the area are offering benefits plans — you may be losing qualified candidates to direct competitors.
#3. You have 3-10+ Full-Time Employees
Most fully-insured plans will require a minimum of three, full-time, eligible employees. Coincidentally, it is around this crucial time that small business owners begin to expand their horizons and think more about the “growth mode” that we talked about earlier.
It should be noted that expectations from working Canadians regarding an employee benefits plan do not appear to change based on whether they’re working for a small business or a large one. By and large, Canadians expect their employer to offer some kind of benefits plan, with particular emphasis on health (including prescription drugs) coverage and dental insurance.
#4. You Have a Budget (Even a Small One)
Employee benefits plans aren’t free (obviously), but nor do they have to be insanely expensive.
Fully-insured plans offer things like Life Insurance, Extended Health Care (EHC), Dental Insurance, etc., can still be manageable cost-wise.
Options such as the BBD Starter Plan, which includes the most common benefits taken by small businesses of 3 to 10 employees, can be excellent places in which to begin and grow.
Getting Started in Group Employee Benefits with the BBD Starter Plan
Additionally, for employers working with either a limited budget or those looking to control their costs more precisely, other options exist. Health Care Spending Accounts (HCSA)s offer built-in cost-containment, allowing employees to budget the exact allocations for employees. This equips employers with everything they need to accurately budget for their exact maximum benefits cost.
#5. You’re Considering Wage Increases
If you’re thinking of upping your employees’ compensation but don’t have a benefits plan in place, you might be better off implementing one instead.
What’s more, pay raises cost you more money than employee benefits. Dollar for dollar, money spent on an employee benefits plan will take you (and your employees) farther. If you were to give employees an extra $1.00 per hour, here’s what might happen:
- Employees take home significantly less after federal and provincial deductions (only $0.60 in some tax brackets).
- That extra $1.00 an hour will actually cost you about $1.29 an hour after you pay the government.
Compare that to offering employee benefits coverage:
- It’s simple math — $1.00 paid in benefits premium equals $1.00’s worth of benefits. Benefits received by employees are often tax-free!
- Employees receive ongoing support to stay physically and mentally healthy, plus protection when they need it most.
- You’ll be able to save your business money by deducting eligible expenses on your taxes.
#6. You Want to Level Up Your Company Culture
Employees that are offered an employee benefits plan will feel taken care of, contributing to a workplace culture that values employees, keeps them healthy and well, and ultimately leads to a more productive and engaged workforce.
Wellness programs, such as a Personal Spending Account (PSA), are an excellent way to show your employees you care while encouraging them to pursue hobbies and interests that lead to passion, creativity, and productivity!