What does it take to keep employees happy?
Between the elevated food, transportation, and energy prices; plunging home values; and volatility surrounding the investment market, consumer attitudes have been shaken to their core. Businesses of all trades are feeling the pinch as the consumer’s belt is forced to steadily tighten.
Human resources (HR) departments particularly face some rather complicated and unique challenges during difficult economic times. For example, a business facing financial cutbacks may decide to cut the benefits budget in HR, only to then task the department to motivate employees feeling the results of budgetary cuts.
Such a challenge may seem impossible to meet, but it isn’t. There are tactics that can either ease the additional financial burdens of employees or help contain benefits costs. Let’s look at a few of the tactics:
* One of the largest items represented in the benefits budget of most companies will be health benefits costs. As such, health benefits often have the greatest cost-cutting potential. Consider putting the health plan out to bid for both your current type of coverage and any different plan that could have a better value. Assess plan features that could hold significant savings, such as prescription drug programs with a good track record on generic usages. You should also make sure that you’re using every available method of helping employees get the most from their benefit dollars, such as through offering premium-conversion plans and flexible spending accounts. Health savings accounts and consumer-directed health plans are also worth exploring.
* Since 100% of the cost of voluntary benefits are paid by the employee, expanding upon or adding voluntary benefits can beef-up the companies benefits offerings without the company incurring a lot of expense. The employee can pay for the policy through regular payroll deductions. Because employees get to take advantage of a group rate, purchasing such policies under an employer is often cheaper for the employees than making the purchase on their own.
* Assess the benefits being offered to ensure they aren’t the most costly, but still play a role in both keeping and attracting employees. Two examples of such would be disability and life insurance coverage.
Qualified Transportation Plans
* High gas prices mean that commuting to and from work becomes a costly expense for most workers. Offering qualified transportation benefits, such as transit passes, vanpooling, or qualified parking, through a reimbursement funded by employee pre-tax dollars is a relatively inexpensive way that employers can help their workers with expensive commuting. The arrangement can save workers money on their Social Security taxes, federal taxes, and possibly state taxes.
* In relation to the cost of transportation, another potential way to help employees save is by making some simple scheduling changes. For example, the schedule can be made to better allow employees the option of carpooling together. If certain employees have job responsibilities that could be completed from their home, then another possibility would be incorporating one or two days of work-from-home for these employees into the scheduling.
* Flexible work schedules, such as a ten hour/four day work week, may be an option for some businesses to save their employees transportation costs and themselves energy costs. Shorter work weeks are also generally favored by employees due to the extra time it provides them for their leisure activities and home responsibilities.
* Even though the budget is tight, make some room to communicate with employees on the value of their benefits. Most employees only see their own out-of-pocket expense for their benefits; they seldom realize just how much their employer is spending to provide valuable benefits to them and their dependents. It only takes a very simple and concise communication to provide a summary of the employee benefits being offered and the employer’s cost.
Of course, these are just a few tactics to tighten the benefits budget and still keep employees happy. Use them as a starting point to get the ball rolling on other ideas to help your HR department meet the challenges presented by hard economic times.