Small companies are great because of their culture, ability to adapt to trends in the market, and their commitment to employees. One area where small business can often falter, however, is in benefits. According to the Bureau of Labor Statistics, small employers are far less likely to offer health benefits to their full-time employees, much less their part-timers. It could be due to budget, being in the early stages of your business, or simply out of negligence, but the lack of health benefits is often incongruous with many small business’ dedication to keeping its employees happy. No matter what size your company is, you should make an effort to provide them with the best possible benefits.
“Don’t Have to” Shouldn’t Mean “Won’t”
According the ACA, companies with fewer than 50 employees don’t have to provide their employees with health insurance. But small employers need to understand that healthcare for employees shouldn’t be considered a luxury — it should be an operating cost. Mitch Heckert ( @MitchHeckert11 ), an employee benefits consultant for The Graham Company, stresses that there shouldn’t be a line between big and small when it comes to benefits:
“A small employer is not much different from a large employer. Why do companies offer benefits to begin with? A lot of times it’s for recruitment and retention . They’re trying to recruit and retain the best employees they can. Even on the part-time level, offering benefits to these employees is a way to get their hooks into an employee and possibly lead to full-time employment. You can differentiate yourself as well. You can say, ‘ABC Company down the street doesn’t offer benefits. We do.’”
Just because you’re a small company doesn’t mean you shouldn’t take care of your employees, and it certainly doesn’t mean you’re not competing for candidates. Health insurance helps keep employees motivated and makes your company more attractive.
Insured Shouldn’t Mean Expensive
Now, to the topic at hand: How are you going to pay for health insurance? The most prominent option for companies with 50 or fewer employees is the Small Business Health Options Program (SHOP), a government program that provides small businesses with affordable health insurance. SHOP, however, is still in its developmental stages, and companies have tended to shy away from using it . Promises of multiple insurance tiers and coverage haven’t made it to market, and some of the other hurdles have left entrepreneurs scratching their heads.
However, that doesn’t mean your company can’t work the system to offer their employees similar health benefits. The ACA still offers individuals a wealth of options when it comes to getting coverage, and many companies have begun offering their employees raises that effectively serve the purpose of health benefits. They provide them a one-time raise, which employees then spend on finding their own health insurance . This option can even be more cost-effective than many kinds of group-based health insurance.
So while you should consider health insurance an operating cost, that doesn’t mean you can’t find ways to make it more affordable.
Benefits Shouldn’t Only Mean Health
Health care is the cornerstone of any employee benefits package, but there are several other kinds of benefits you should provide your employees. 401(k)s, pensions, vacation days — these are all part of a well-rounded employee benefits package. When it comes to savings accounts, a little can go a long way. 74% of organizations in a recent SHRM survey said they match their employees’ contributions to a standard 401(k) account . These contributions are generally not large on a week-by-week basis, and so companies can usually afford to add to these accounts.
As for the other offerings, the same questions arise: How do you afford it? For companies looking to offer big benefits on a small budget, a Professional Employer Organization (PEO) might be in order. PEOs are like mutual funds for employee benefits: When you sign your employees up for one, they’re added to a large pool of employees from several other companies. By paying for these services, you then have access to the kinds of benefits employees at larger companies have.
The lesson: If you’re dedicated to finding the best for your employees, there are ways to do it. Working around procedures, helping your employees invest in themselves, and finding new solutions to old problems are just some of the ways you can make your employees lives better, and get more out of them in return.