Archive for the ‘Employee Compensation Reports’ Category
Raising the minimum wage has been an often discussed topic among politicians, business owners, and corporations. This is a policy that would affect how many companies conduct business. In 2014, Seattle set the bar by passing a law that gradually increased the minimum wage from just over $9 in 2014 to $15 an hour in 2021.
On the federal level, this idea had been floated in Congress for several years, culminating in H.R. 582, which was introduced in January of 2019. H.R. 582, also known as the “Raise the Wage Act,” set a six-step, phased-in increase of the minimum wage from $7.25 to $15 per hour by 2024 passed the Democratically controlled House; but it was killed by the Republicans in the Senate in 2019.
However, the Seattle law gained new attention with then-Democratic presidential candidates Joe Biden and Bernie Sanders. As the Biden administration takes power and the Democrats assume control of both the House and Senate, the $15 an hour minimum wage is again in play.
The Pros and Cons of a Minimum Wage Increase for Your Business
As with any law, there are both pros and cons to increasing the minimum wage for businesses, employees, and consumers.
It’s important to look at and understand all sides of this type of federal mandate.
Higher Wages Boost the Economy
Paying people the funds needed to pay their bills and purchase products, goods, and services is a great way to boost the economy. An increased minimum wage gives workers more buying power and can provide an uptick in the economy through increased spending.
Economic stimulation due to increased purchasing power can increase demand for products and services. This can lead to job creation to keep up with demand.
Help to Employees and Their Families
Along with increased purchasing power, employees and families benefit. An increased minimum wage helps with price inflation and the inevitable increase in the cost of living.
There are also some potential downsides that need to be considered with a significant increase in the minimum wage, including the following.
Higher Product Costs
Increased minimum wages increase overhead costs. This can result in a higher product price which must then be passed on to consumers.
A Stalled Job Market
Because of increased business costs, companies could potentially freeze hiring to keep costs under control.
The cost of outsourcing is less than the cost of new hires. Rather than a hiring freeze, companies could increase outsourcing to control costs.
Some Additional Benefits for Businesses
On top of the pros above, there are additional benefits for your employees and your business from raising the minimum wage. Higher paid employees feel more job satisfaction. With it comes higher levels of collaboration, creativity, and communication. Satisfied employees are likely to remain loyal, lower turnover, and help your business by lowering hiring and training costs.
Higher wages can also lead to higher motivation and better performance. This is especially beneficial if your employees were working multiple jobs to pay their bills. Higher wages may allow some employees to give up their side jobs and focus on your company.
Many business owners and economists believe that a minimum wage increase is inevitable. It’s important to prepare your business now to be in a position to absorb rising operating costs.
Preparing now can help you prevent the need to pivot at the last minute when the new minimum wage goes into effect. Not only will you put your business in a stronger position, but your employees will also appreciate that you care enough about them to prepare.
It’s also important to make sure employees know all the benefits they are getting with your company. A total compensation statement, like those offered by COMPackage.com, can an employee see how generous the company has been in terms of the value of the many benefits (obvious, and not-so-obvious) you provide.
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.
It’s no secret that employees who are happy and healthy are more productive–and offering high-quality employee benefits leads to both.
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.