The demographics of the labor market are not stagnant. Nowadays, generally, the more skilled people are employed, and there is a reduction in the number of people looking for jobs. Thus, businesses find it harder to fill empty positions with the appropriate personnel. The employers had to find ways to attract, attain, and retain the best talent for the businesses. Thus, the reason for the introduction of voluntary benefits into the labor market.
Voluntary benefits involve giving employees a discount group rate over goods or services offered by employers. The employer will deduct the money from the employees' payroll as a payment for the goods or services they must pay in full or parts of it. Many times, after receiving the traditional benefits, the employees will also receive voluntary benefits. Supplemental insurance and employee-paid benefits are the other names for voluntary benefits. Employers provide the workers with these benefits to prevent them from quitting their job and also help in reducing the payroll taxes.
Employers can give their employees voluntary benefits through various means, but the common examples include:
Health: Employees enjoy extra health insurance options as voluntary benefits. These options include critical illness, emergency hospital transportation insurance, disability insurance, accident insurance, and Telehealth access.
Dental: There is a closure of the gap between covered procedures and those that are not. It is possible because of the additional dental options. They include sealants, tooth removal, crowns, and dentures.
Vision: Employees benefit from discounted rates for all procedures involving the eye like glasses, laser eye surgery, eye examination, and contact lens.
Wellness and Lifestyle: It involves offering free or discounted services for the well-being of the workers. Gym membership and legal services are part of these benefits.
Financial: This benefit is all about helping the workers manage their finances. Examples are investment advice, financial planning services, student loan repayment programs, and tax help.
Security: If death or Identity theft were to occur, these benefits would cover it. They include life insurance and identity theft protection.
Personal and Miscellaneous: Anything the employer feels can benefit the workers and prevent them from quitting can be placed in this category. Some include flexible work hours, remote work, pet, and travel accident insurance.
No company can underestimate the importance of voluntary benefits. Some of the reasons for this are:
It aids the company in recruiting and retaining the best talent
It reduces the time spent worrying about certain aspects of their personal lives and makes employees productive at work
It reduces healthcare costs for employees and the company in general
It helps to keep workers happy and satisfied
Although the employees receive voluntary benefits from the employer, the employers can also benefit from it. The following are the advantage:
It makes attracting and keeping loyal workers easy
Helps in the competition with other companies
It does not involve direct cost
Employees become dedicated to their work after enjoying those benefits, increasing their productivity.
In case of inadequacy of traditional insurance, it helps provide a financial safety net for the employees.
Discounting of services because of unique group rates
Voluntary benefits have few limitations, and they include:
The staff requirements for some voluntary benefits are two to five. In contrast, there are no minimum requirements for other voluntary benefit policies.
The eligibility to sign up for the voluntary benefits is only through the business owner.
Part-time employees usually have minimum work hours requirements to be eligible for voluntary benefits.
Application for the benefit may have specific age limits
The eligibility for benefits might be affected by already existing conditions.
Identifying the company's aims and determining the workers' needs can help determine the kind of voluntary benefits to offer workers. Also, it can be determined by evaluating and reviewing the present legislature or industry standards concerning voluntary and traditional benefits. The following questions need consideration when choosing voluntary employee benefits for packages:
What are the objectives of Human Resources currently and in the future?
Compare the structure of other companies' benefits to yours; what are the differences?
Based on the demographics of the employees, what benefits will they value most?
Are there any legal obligations that can be fulfilled with the benefits?
Can voluntary benefits get affected by any current legislation?
Although the questions may seem much, asking them is crucial to obtain optimum value from voluntary benefit options. However, a faster and easier way to carry out the process is by using unique software for administrating voluntary benefits or using insurance/benefits brokers.