Is it part of your job description to complete regular performance reviews? If so, this is not something you should take lightly. It is important to do this at least once per year with each employee that you are responsible for.
So, what are the downsides of infrequent performance reviews?
- Employees don’t have any feedback on what they are doing right, what they are doing wrong, etc. In turn, they continue doing things the same way and never progress as a worker. In the end, both parties are held back from reaching their maximum potential.
- Out of touch for too long. Let’s be honest, there are times when you go month after month without speaking to some employees. While this is more common in large companies, it happens everywhere. Business owners need to share their vision with employees at every turn in the road. With an annual performance review, you will have time to focus on each employee’s contribution to the company.
- One missed review can cause future trouble for you (the owner), the employee, and others in the company. Take this situation, for example. You have to fire an office manager because he failed to meet your expectations. While you have the right to do so, wouldn’t it be better for both parties to discuss this in a performance review?
Performance reviews need to occur regardless of salary expectations, such as a raise. It is not always about money. A review shows leadership and coaching, while ensuring that employees are growing and moving towards company goals.
Now do you see the downside of infrequent performance reviews? Avoid falling into this trap, or face the trouble outlined above. And while you’re at it, don’t forget to include a total compensation report in your employee performance review.
The process of recruiting and retaining top talent is today’s toughest job. Because as an employer, you need your employees as much as they need you, you should actively communicate your employee value proposition (EVP) to potential and existing employees.
Importance of an EVP
An EVP is a strategy of everything a company has to offer to an employee. It is usually divided into salary and benefits, and it varies depending on the employee’s role, tasks, credentials, and skills. If an EVP is planned out well and laid out in detail, the employee will know the actual value of the compensation package they’re getting, and also the reasons they are getting it.
Were they headhunted from a competing company, and are now being offered a compensation package they should find irresistible? Did they perform well in the past year and now have given a significant raise not just in salary but in perks as well? Then they should know all about it through their personal total compensation statement. An EVP is essentially a sales pitch, and should be treated as such.
All companies have their own particular EVP, whether well-defined or not. Nevertheless, for the sake of attracting and maintaining top talent, it behooves you to have your company’s EVP clearly defined. How does your EVP compare to your competition? Or maybe the better question is, is your EVP, and whatever actions you take to communicate it, working well to recruit and retain employees?
Is your company’s EVP in sync with your company’s core values? For example, if your company values loyalty, your EVP might include additional incentives for employees who meet a specific length of service.
Role of Employee Compensation Software
An EVP is not a one-time thing. You don’t develop it and then just leave it there. It has to be regularly reviewed and continuously improved to be competitive.
For example, technology is rapidly changing the way people work. Think about it: If the last time you’ve updated your company’s EVP was five year ago, then your telecommuting perks (if you have them in the first place) need to be revised in light of the new digital solutions that have made remote working easier and smoother. Instead of offering just one day for working from home, maybe your company can now afford to make it the whole five days. But that’s just one thing to look out for.
Aside from streamlining your EVP, employee compensation software can also help with highlighting the important values that can drive an employee’s compensation. As with marketing to customers, marketing to employees shouldn’t come across as generic if you want to make a lasting impact. Because, today, you can tailor your EVP on a total compensation report accordingly.
Employee compensation software solutions, like those from COMPackage, also help with transparency. You never want your employees to feel shortchanged, so you must be able to explain their compensation package instantly, regularly and repeatedly in order to promote your EVP.
In today’s competitive recruitment landscape, an employer like you should not only value your employees; you should also make it clear to your employees just how much you value them. It sounds like common sense to do so, but you’ll be surprised at how many employers fail to let employees know the exact monetary worth of their total compensation package. Minor benefits like summer Fridays or corporate discounts are always appreciated, but also often underestimated. As a result, employees don’t often realize what they’re getting.
Thus, it’s important for your company to use employee benefit statement software to break down and keep track of employees’ benefits. Using such software helps with the recruitment of new employees and the retention of existing employees. Here are a few reasons why.
1) Transparency – As mentioned, employees appreciate their benefits more if they know exactly what they’re getting. Even non-monetary benefits like mentoring programs and flexible schedules have monetary equivalents, and employees should know about those. People pick and stay at a job for more reasons than money; but there’s no denying that money plays a big part, so it’s best for your company to emphasize that.
2) Spotlight – Some benefits are unique enough to deserve being highlighted; otherwise, they may end up being taken for granted. A few examples of such benefits are free parking, wellness plans, and pet care. These are not considered core benefits, but some companies offer them to motivate employees. But because these are not core benefits, they need to be brought to attention to employees in their employee benefit statements.
3) Automation – Newly added, removed, or updated benefits are automatically reflected in the employee benefit statements, so that employees always see the most accurate listing and calculation of their benefits at any given moment. At the same time, you don’t need to manually adjust statements each time there is a change in benefits when you use employee benefit statement software. It’s a win-win situation for everyone involved.
4) Awareness – Benefits can go unused if employees are either unaware these exist in the first place, or they know but simply forget later on. However, using employee benefit statement software changes all that. Employees can quickly check which benefits they have and haven’t used yet, and also how to use them in case they still haven’t. You’d be surprised at how many employees fail to take advantage of all their benefits simply because they don’t know how to.
Is using employee benefit statement software the right path for your company? There’s only one way to find out, which is to try it out yourself. But given the advantages already listed out here, the answer to the question is quite clear.
Joseph Blattner is the founder of COMPackage.com, the world’s first online employee benefits software solution.
Over the past 12 months, most companies have increased their benefits to remain competitive, with health and wellness seeing the largest increases according to the Society for Human Resource Management. Here are seven ways that your company can increase competitiveness by taking advantage of Employee Benefit Reports.
- Stay on-trend. To compete in the marketplace for the best employees, providing on-trend benefits is one way to ensure that potential employees will take a close look at your company. With prepared reports, potential employees never have to guess at what you have to offer.
- Increase the perception of the value of your benefits. When you write out your benefits for employees in an Employee Benefit Report, while it does not increase the dollar value, many employees will have the perception that their benefits are worth more – and this added benefit can be achieved with negligible expense.
- Improve your employee morale. One thing is clear: happy employees know their worth, and nothing says it better than a clear presentation of all the benefits each employee receives.
- Use your Employee Benefit Report to attract and retain employees. For many employees, benefits will contribute up to 43% of an employee’s base pay. When you want to attract or keep the best talent, showing them what they can expect will help them to see their importance and to see their quality of life while working at your company.
- Reduce the use of sick days and other absenteeism. It might seem counterintuitive but presenting your employees their benefits relating to the sick day policy and others regarding paid/unpaid time off has been found to reduce, among other things, employee sick days.
- Consistent engagement. Once you have done all the work to bring in the best of the best, keeping that talent and improving production requires a strong team. You can leverage your Employee Benefit Report by using it to engage employees through questionnaires, team building, hosting Q&A meetings (during and after office hours), and other events that show those changes in rollouts of new Employee Benefit Reports.
If you’re ready to take the next step, you may find it’s easier, and less expensive than you imagined. Check out Employee Benefit Reports from COMPackage. There’s even a 30-day full-refund guarantee if you’re not fully satisfied.
How important is it to your organization to have “identity protection” show up in your employees’ total compensation reports? In the past few years, concerns over identity theft have slowly been making their way into benefit options as companies look differently at protecting their employees from data hacks. With the massive security breach at Equifax Inc., which, according to USA.gov affected 143 million consumers, even more companies are likely to add identify theft protection to their complement of employee benefits as early as 2018.
Current estimates are that about 35 percent of companies now offer some sort of identity theft protection. The reasons are straightforward. Security breaches expose an individual’s personal data – driver’s license, bank account, and social security numbers – to relentless hackers. The Insurance Information Institute notes that in the last seven years, identity thieves have amassed $107 billion from stolen identities. Many hackers take the data to sell it, such as bundling credit numbers to sell in groups to willing buyers, or keep the best data to use for themselves and use it to steal from unsuspecting individuals. From law offices to Dropbox, hacks pose a serious threat to employee well-being, and company benefits are a critical avenue for companies to respond. And companies must respond because the costs of identify hacks are high.
For employees, the costs extend far beyond recovering overcoming any direct financial losses. It can take months of phone calls, emails, and correspondence to contact creditors and repair credit reports. Most of those calls must be made during working hours, so many victims of identity theft are either distracted at work or need to take some time off. The amount of time an employee must consume during normal working hours to straighten out this mess that’s of no cause of their own are way more hours of company time than any company would want to lose. But, the employee has no choice. So, if you won’t give it to them, they may feel forced to take it anyhow.
Other victims find that having their identity stolen is traumatic, which means they must also recover from the emotional stress. For these reasons, identity theft can lower employee productivity.
For companies, however, the benefit to the bottom line begins with their employee’s well-being. While the jury is still out on the effectiveness of anti-identity theft protection, studies show that employees gain peace of mind from the benefit, and with peace of mind comes increased productivity – and profitability. Identity-theft protection offers peace of mind to companies, too, because most hackers make their way into corporate accounts through employee’s personal records. Shutting down employee identify theft also protects the company.
The best news for employees and employers is that the benefit is not only low-cost to employees since it is non-taxable benefit, but companies can usually get the employee coverage from issuing companies either free-of-charge or at a steep discount. There is a great likelihood that companies can successfully negotiate a preferred rate from a quality service.
It should come as no surprise that the fastest growing benefit option is identity theft protection. So, companies moving too slowly with ramping up their identify theft protection benefit risk losing their competitive edge in recruiting and retaining valuable employees.
Benefits don’t need to be expensive to be appreciated. Low-cost perks can leave a high impact. One such perk is ‘Summer Fridays’ in which employers allow employees to leave a few hours earlier on some, most or all Fridays of summer.
Cost of Summer Friday
The great thing about this perk is that it makes for a significant addition to employees’ total compensation reports, yet it doesn’t cost much to implement. If anything, you save more on electricity, water, and other office expenses when people aren’t at the office. In terms of productivity, you’re not sacrificing a lot, either. According to a survey conducted by Accountemps – an accounting staffing firm – Thursday and Friday are the least productive days of the week. Your employees may be physically present to complete their full hours on Fridays, but they’ve already mentally checked out of work and checked in to the weekend. Given this, perhaps you might as well make them happy by allowing them to leave early, especially on long weekend holidays. Of course, it may be challenging to implement Summer Fridays for hourly-based jobs (like contact center representatives), but for output-based jobs, it shouldn’t be a problem. As long as your employees meet their expected deadlines, they should be good to go at the end of the work week.
Effect of Summer Friday
A flexible work schedule – which is what Summer Fridays is essentially part of – increases morale and satisfaction, which in turn increases productivity. Employees who enjoy work-life balance feel that they’re in control of their schedules, and not the other way around.
In addition to that, Summer Fridays in particular prevents burnout by giving employees something to look forward to every week. It also gives them the motivation to finish their tasks well before the deadlines, so that they can enjoy this perk. It’s a win-win situation for both staff and company.
To ensure your employees fully appreciate Summer Friday, make sure to quantify it in their total compensation reports. Even if they’re not paid by the hour, you can still compute their hourly rate from their yearly rate. This makes it possible for you determine the monetary value of the number of hours they’re allowed to take off for Summer Friday.
In the latter years of running Blattner Brunner, an advertising agency with over 100 employees, we instituted Summer Fridays off for noon on from Memorial Day to Labor Day, but with the caveat that each employee was responsible to make up the four hours anytime during each work week. We never monitored it. Didn’t feel we needed to. The benefit to making our agency a best place to work was significantly felt, especially during a time of tough recruiting for the best and the brightest … a time we’re also in today.
If you still haven’t implemented this perk yet, now is the perfect time to start!
Joe Blattner is the Founder and CEO of COMPackage.com, makers of the COMPackage Total Compensation Reports.
A good compensation package attracts and retains top talent, so it’s crucial for companies to provide the best they can offer. It’s why employee benefits statements are so crucial — they serve as a measurement of just how much a company is willing to invest in its people.
But if your company is working within a fixed budget, how can you provide enticing benefits without overspending? How can you go beyond government-mandated benefits and deliver something extra?
The answer is in low-cost but high-impact benefits. Some of the perks employees appreciate the most are affordable enough not to dent your budget. Here are some examples:
Work-life balance is a goal for many employees, so help them achieve that by giving them a flexible schedule. There are several ways to accomplish this, such as authorizing a couple of work-from-home days every week, implementing staggered hours instead of a fixed login time, or allowing people to offset shorter hours in one workday with longer hours in another workday.
You’re not giving money to your employees when you offer them flexible schedules. You’re giving them time, which, to many, is far more valuable.
Paid vacation leave
The US doesn’t require employers to grant paid vacation leave to employees. But all work and no play makes Jan a disgruntled worker, so it’s better to allot a fixed number of paid vacation days which your employees can use whenever they want to as long as they give advanced notice.
To avoid going over budget, don’t make unused days convertible to cash. Forfeit them at the end of the year and reset the counter at the start of the new one. Or you might choose to give an extended rollover period, for example for a period of three months.
Financial planning assistance
According to a 2016 survey by Magnify Money, more than half of Americans are living paycheck to paycheck. Given how large this statistic is, chances are that many of your employees are living this way, even if they’ve been working for years.
Help them out by teaching them how to fish. Offering financial planning assistance won’t cost your company a lot, but it can make a world of difference for your employees who are struggling to budget their money wisely.
Corporate rates on insurance plans
Individual rates are higher than corporate rates, so your employees will appreciate it if they can get a discount through your company on life, accident, auto and other kinds of insurance.
Also, automatic payroll deductions make payments faster and easier. This added convenience is a benefit worthy of being included in employee benefits statements.
Where do your employees get their morning coffee? Where do they work out after they leave the office? Most likely, it’s that cafe around the corner and the gym a couple of blocks away, respectively.
Thus, approach nearby commercial establishments to see if you can get discounts for your employees. A lot of businesses will be happy to oblige if it means more customers.
These examples clearly show that although monetary compensation is of primary importance for many people, the little things do add up and make a difference. But your employees won’t get to appreciate the full effect of these perks unless you lay it out for them in employee benefits statements from companies like COMPackage.com. Only then will they see the total value of the compensation they’re receiving. If you’ve been looking for a way to boost staff morale, employee benefits statements are the way to go. After all, you can’t appreciate what you don’t know you have.
You can promote employment opportunities on corporate talent networks. You can use assessment science to put the right prospects in the right places. And you can invest in technology that delivers an exceptional candidate experience.
But at the end of the day, there’s still one recruitment tool that outshines all others: employee benefits.
Here’s a look at five ways offering quality employee benefits helps improve employee work base and attract top talent.
1) Increase your appeal
Skilled dedicated workers are the lifeblood of every successful business. They can also be difficult to attract.
The best employees have options, so it’s important to make yourself more appealing by offering more than just the bare minimum of baseline pay, two weeks’ vacation and standard health plans.
Offering exceptional benefit packages increases your appeal. According to a survey conducted by Glassdoor, benefits and perks play a major role in helping people decide whether or not to accept a job offer.
Creating a benefits program that is better than the rest improves your ability to attract top talent–especially if you can show candidates employee benefits reports that demonstrate exactly what they will receive after accepting an offer.
2) Reduce the rate of turnover
Employee turnover is a normal part of doing business, but it still hurts.
Turnover increases recruitment costs, reduces productivity and affects other employees, teams and the entire business. It’s one of those costs that doesn’t necessarily show up in most employee benefits reports.
Minimizing your turnover rate is a smart move–and offering high-quality employee benefits is one way you can reduce your rate of turnover.
According to a study conducted by Glassdoor, four out of five employees want quality benefits more than they want pay raises.
Give current employees what they want and they’ll be less likely to leave.
Low morale comes at a high cost. It leads to turnover, low productivity, more employees calling in sick and even dangerous work environments.
There are a lot of ways to lower morale and just as many ways to improve it–including offering quality employee benefits.
High-quality employee benefits accomplish two things: They keep your employees healthier, which keeps them at work. And they demonstrate to employees that they are valued.
With that in mind, you can’t really afford not to offer high-quality benefits.
4) Healthy employees
According to the Centers for Disease Control (CDC) Foundation, absent employees cost U.S. employers more than $225 billion annually.
Employees who are sick and not in the office can’t help your company achieve its goals.
Health insurance helps keep employees healthy–and it helps them recover more quickly from illness and injury.
5) Increased productivity
The CDC Foundation says that people going to work sick account for almost two-thirds of all costs associated with employee absenteeism.
Sick employees aren’t productive and they put their colleagues at risk. So why do they continue to show up? Maybe because many workers (nearly four out of 10) don’t have employee benefits that include paid sick time.
This might save you money in the short-term, but over time it can cost you a lot more in productivity.
What do your employee benefits reports say about you?
Do your employee benefits reports show a company that differentiates itself from the competition, cares about keeping employees and works to keep them happy?
If so, you probably have happy, healthy, productive employees. Now, make sure they know what you’re providing! Connect with Compackage.com to generate low cost, easy-to-use employee benefits reports.
Many company leaders, and similarly their employees, think that all company paid holiday policies are created equal. After all, they reason, these are national holidays. However, this is far from reality! At least 25% of companies nationwide do not provide for any holiday pay at all. The other 75% can provide from as little as one, to as many as thirteen, paid days off. So, the higher the number of paid holidays that your company provides, the more generous your company is.
Laws Governing Holiday Pay
Currently, there are no federal laws requiring an employer to provide holiday pay for their employees. Holiday pay is strictly a voluntary benefit offered by employers who wish to foster a positive company morale and bolster employee benefits packages. Indeed, the more lucrative the holiday pay, the more likely employees are to feel valued and appreciated. Especially if this benefit is defined in relative terms, such as in an annual benefit statement.
Understanding a Typical Holiday Pay Package
Many employers provide 1-5 paid holiday days, while others offer up to 10 paid days of holiday time off. Very few will offer the full 13 days of federally-recognized legal holidays, but there’s no doubt your employees will appreciate their place of work all the more if your company does. When added to other types of paid time off, including sick leave and vacation pay, this can represent upwards of an additional 13% of the salary for each employee (e.g., $5,200 for an employee with a $40,000 annual salary if you provide paid time off for 13 holidays, 15 vacation days, 5 sick days, plus bereavement or jury time off). Of course, the final value should be detailed in the employee compensation reports provided annually to your employees.
What Are Federally Recognized Holidays?
Employers may choose to offer holiday pay for any of the following federally recognized holidays.
- New Year’s Day
- Martin Luther King Day
- President’s Day
- Easter/Good Friday
- Memorial Day
- Independence Day
- Labor Day
- Columbus Day
- Veteran’s Day
- Thanksgiving Day (2 days)
- Christmas (2 days)
Are Companies Required to Accommodate Religious Holidays?
Religious holidays can be a tricky issue for companies, depending on the number of employees on staff, especially if those employees hold drastically different religious and cultural beliefs. Legal statutes require the reasonable accommodation of religious holidays. As such, many employers will offer 1-2 floating holidays in lieu of the holidays listed above. Let’s face it, few people may choose to celebrate Columbus Day, but there may be several employees who wish to celebrate Yom Kippur. By offering floating holidays, instead of sticking strictly to the federal holiday schedule, you allow employees to select the days which mean the most to them.
Must Holiday Pay Packages Be the Same for Everyone?
As long as your policy doesn’t discriminate based on age, gender, race or other protected classifications, policies may vary based on position within the company. For example, many companies will offer holiday pay to full-time staff, but not to part-time employees. When in doubt, seek the expertise of a compensation specialist to ensure compliance with labor policies.
Holiday Pay and Overtime
Employees often believe that holiday pay equals premium or overtime pay. This is simply not true. There are no requirements that mandate an employer pay overtime for holidays. In fact, in most cases there are no requirements that stipulate civilian employers must offer paid time off for holidays, vacation or illness. But if you do, you should detail it in your annual total compensation report!
Furthermore, holiday hours cannot be factored into the overtime calculations for the employee. Employees are only eligible for overtime if the actual number of hours worked for that week exceed 40 hours (and not a combination of holiday hours and hours worked that surpass 40 hours for the week).
Documentation and Holiday Pay
Holiday pay varies greatly from company to company. As such, it is vital that organizations outline their leave and holiday policies carefully to avoid employee confusion. As long as holiday pay is offered in accordance with established company policy, employers have the flexibility to create a policy that works best for their unique environment.
Lastly, all paid leave, including holiday pay, should be documented in the annual employee compensation reports. If your company is one with a more generous holiday pay package, let your people know. Such reports provide employees with a snapshot of their total compensation picture. Affordable online reporting systems, like those offered from COMPackage, can assist your organization with creating employee compensation reports that increase overall employee morale.
Update: Here’s a new guide to understanding Floating Holiday Policy that also features a sample policy template for reference.
In 2014, the Affordable Care Act made 10 “Essential Healthcare Benefits” (EHB) mandatory, no matter the size of the company you work for or your healthcare provider. These requirements are set to come online in 2017.
Importantly, healthcare plans must be balanced among the 10 categories, namely,
- Outpatient care (care you get without being admitted to a hospital)
- Trips to the emergency room
- Treatment in the hospital for inpatient care
- Care before and after your baby is born
- Mental health and substance use disorder services
- Prescription drugs
- Services and devices to help you recover if you are injured, or have a disability or chronic condition
- Lab tests
- Preventive services
- Pediatric services
Your insurer can substitute benefits within each category, but cannot substitute one of the main categories, and it can change coverage, such as a benefit’s duration. Finally, under the EHB, your plan cannot discriminate against you because of your age, disability or your expected length of life. Here is some greater detail about the services that must be included.
Ambulatory patient services. These are the services that you likely use the most, since they cover your regular doctor’s visits. Most plans, regardless of your company’s size, usually cover this service.
Laboratory services. The new law requires that healthcare insurers cover preventive tests like Pap smears for women and prostate exams for men. However, your insurance coverage can bill other types of diagnostic, so check to see what is covered on Employee Compensation Reports.
Prescription drugs. The EHB mandates that all healthcare plans now cover some prescription drugs. All plans must now cover at the minimum one drug in every category and class of medications approved for use in the United States. And, when you pay for prescriptions the cost must be applied to your annual out of pocket expenses.
Maternity and Newborn Care. This new requirement entitles all mothers and babies healthcare before and after the baby is born since prenatal care is preventive care, so it must be given at no additional cost.
Emergency services. Your coverage extends to trips to the emergency room. EHB allows you to get emergency services even out of network with no extra fees. And, your plan can no longer require that you get preauthorization before you seek emergency services.
Hospitalization. This new requirement means your healthcare insurance must cover inpatient treatment for any serious medical concern. It does not mean, however, that you are exempt from paying a copay which can be quite expensive if you are still under your annual out of pocket limit.
Mental health and substance use disorder services. Perhaps this is one of the most extensive additions required by the EHB that is laid out in the Employee Compensation Reports. Your healthcare plan must include behavioral health care, substance abuse, and mental health coverage on par with that of the plan’s physical health benefits.
Rehabilitative and habilitative services and devices. Your plan likely already covers rehabilitation therapies like pain relief or learning to walk again, and cover equipment like wheelchairs. However, now habilitative services must also be covered, which are therapies that help with long-term disabilities like Parkinson’s disease.
Preventive and wellness services. These services include things like vaccinations, counseling and screenings that help to prevent more serious illnesses.
Pediatric services (including oral and vision care). Under EHB, now all children under the age of 19 can get dental and vision services, including one pair of glasses every year.
It’s important for employees to know what benefits they receive. Savvy employers use Employee Compensation Reports, like those from COMPackage.com, to highlight the total compensation an employee receives. After all, you can’t appreciate what you are getting if it’s not clearly spelled out. No one knows what changes the new administration will make, but such changes take time, so the aforementioned may be valid for a while to come.