Posts Tagged ‘Employee Health Insurance’

Do Your Employees Know the Full Value of Working for You?

Thursday, September 16th, 2010

pre employment screening, employee background checkI was once presented a job offer that included the usual items: salary, health benefits and number of paid vacation days. But the smart businesswoman I would come to work for included a few extras. She itemized the yearly value of my health insurance package, the amount of Social Security Taxes the company would pay on my behalf and the contributions the company would make to the state worker’s compensation fund.

The salary number was great—but seeing the real numbers behind the perks (mandated or not) really opened my eyes to the value of this company bringing me into their employ. Value to me; cost to them.

Years later, when I had my own company and was hiring my own employees, I used this same tactic. Whether it impressed my staff as much as it did me, I don’t know. But I, too, wanted my employees to how hiring them would put more money in their pocket than their net paycheck might indicate.

If your employees are unaware of the real cost of their employment—and the real contribution you as an employer are providing to their well-being and their future—remember, there’s no law against telling them.

6 Benefits Your Employees May not See

  1. Vacation: How much is their paid time off worth? Two weeks and a half-dozen or so paid holidays can add up to thousands of dollars. Your staff might think they’re owed paid vacation (and of course everyone deserves time off), but it is still a hit to the company’s bottom line.
  2. Social Security and Medicare: This is a big one. Do your employees realize that you contribute up to $6,621 per year to their future Social Security earnings? And 1.45% of their earnings to Medicare, with no cap? Chances are they do not. Informing them of this fact might just make them appreciate you someday!
  3. Unemployment: When an employee is laid off, the first thing they usually do (after sleeping in) is file a claim for unemployment benefits. Do they realize that you, the employer, is obligated to pay into this fund? Probably not.
  4. Worker’s Compensation: Just as your company makes unemployment contributions on its employees’ behalf, they might not know that worker’s comp is also available to them because of employer-paid premiums. All they know is that they can file a claim when they’re injured and collect the payments.
  5. Retirement plans: Whether it’s through profit sharing or contributions to a 401K, a company-paid retirement plan is free money in your employees’ pockets. They should understand that it’s optional and generous.
  6. Health Insurance: It might seem obvious, but seeing the dollar value of a year’s worth of paid health insurance premiums can really open an employee’s eyes to the sacrifice employers make to do the right thing.

Disclosing to your employees the true cost of bringing them into your company can be a good thing, when handled correctly. In my case, my employer made me feel very fortunate to be hired, and communicated a real commitment to her employees. Making an employee feel like a burden is the wrong approach.