What Voluntary Benefits Attract And Retain Employees?

Employee turnover is expensive. It affects the bottom line and employee morale. The current job market favors employees, so employers must work hard to maintain engagement and avoid high turnover.

A comprehensive employee benefits package is a key to retention. In fact, SHRM research shows that poor pay and benefits are the primary reasons employees quit.

The Importance of Voluntary Benefits in Employee Retention

A comprehensive benefits package includes more than traditional health insurance, however. In fact, the right combination of voluntary benefits can be a game-changer. Studies show that about half of all workers are more likely to stay with employers that provide voluntary benefits. Employee engagement also improves.

Voluntary benefits are those perks that workers can select over and above a company's primary benefits package. Workers pay for voluntary benefits, but employers administer them, allowing workers to take advantage of a variety of programs. Thus, you can offer an array of voluntary benefits to meet the diverse needs of employees without increasing your costs. You can also do so without increasing the workload on your human resources staff.

Trends in Voluntary Benefit Offerings

The high cost of health insurance and the high deductibles that come with many traditional health plans have made some employees nervous about their financial security. Employees want ways to mitigate the financial risk to their families from a major illness, accident, or death. Many are also anxious about their mental health and seeking these benefits.

Personalized benefit plans are also a trend. For example, one employee might value being able to buy pet insurance at a discount, while another values help in repaying their student loan. Still, others might want a free or discounted gym membership or additional paid time off. Companies that empower employees to build their ideal benefits plan will develop employee loyalty and drive employee engagement.

Employees also value work-life balance. Benefits that enable them to work remotely at less personal cost are another trend. Also popular are benefits that help employees make the most of their time off, such as vacation or event discounts.

Voluntary Benefit Offerings

Here are some examples of popular voluntary benefit offerings that attract employees without depleting company resources.

Legal and Identity Theft

About one in five people have been an identity theft victim in their lifetime. Mitigating the consequences of identity theft requires considerable effort and money. You can give employees peace of mind by offering identity theft protection at a discounted rate. You can also provide them with a voluntary legal benefits plan. The legal plans can help them deal with the legal issues associated with identity theft and with other issues such as writing wills, buying or selling a home, or contractor problems.

Fitness and Wellness Support

Employees feel valued when their employers offer benefits to help them achieve their wellness goals. Examples include discounted gym memberships, yoga classes, spa treatment, and equipment. Other options are discounts on meal kits that ease the preparation of healthy meals and control portions.

Recreational Opportunities

FunLife Rewards is a loyalty program that gives employees points each time they book a leisure activity, such as a hotel stay or concert tickets. Employees can then use the points for special recreational experiences, such as a stay in a luxury hotel or a family vacation.

Insurance

Most companies offer traditional health insurance and life insurance. You can be a more competitive employer by offering corporate discounts on other types of insurance. Examples are

• Discounted auto insurance
• Accident insurance, which offers additional benefits in case of injury or accident.
• Critical illness insurance, which makes cash payments if the employee is diagnosed with certain diseases such as cancer or heart disease
• Hospital indemnity insurance, which covers charges for a hospital stay that aren't covered by traditional health insurance.
• Pet insurance, which covers routine visits and treatment for diseases or accidents.
• Long-term care insurance, which provides benefits should the employee need to go to a nursing home or assisted living facility.

The Impact of Voluntary Benefits on Overall Compensation Packages

Voluntary benefits can boost your compensation package, making it more attractive to a diverse workforce. Offering these benefits can also reinforce that your company cares for employees and understands what they need for a balanced life. Companies that include voluntary benefits can set themselves apart in the competition to attract and retain top talent.

Customizing Voluntary Benefits to Meet Diverse Employee Needs

Each employee is unique, with unique life needs, passions, and goals. Voluntary benefits allow each employee to create a personalized set of benefits that can change as their needs change. Personalized benefits are a trend; you'll demonstrate that you are on the cutting edge by offering options. Offering voluntary benefits also demonstrates that you honor each employee's uniqueness. You increase employee utilization of benefits while boosting employee loyalty.

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Sources
Forbes: What Are Voluntary Benefits? The Ultimate Guide
Human Resource Executive: Why voluntary benefits are a ‘game-changer’ for retention
International Foundation of Employee Benefit Plans: Employee Attraction and Retention Through Voluntary Benefits
SHRM: Salary Gripes Are Top Reason Employees Quit
WorkHuman: Introducing the Human Workplace Index: The Return-to-Work Rundown