What benefits can employers offer to improve employee retention?

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In  times of record employee turnover as workers resign in search of greener pastures, revisiting employee benefits offerings might help retain top talent. In fact, a fall 2021 Workhuman survey found that 66 percent of employees are waiting to review their company's new benefits offerings before deciding whether to stay or go.

Before overhauling your employee benefits package, start by understanding why your employees are leaving. Conduct interviews with or survey employees who are leaving as well as those you still have the opportunity to retain. Collect information on what employees like about your company's benefits as well as what may be driving them out the door.

While the demographics of your workplace will have a significant impact on the benefits employees want, there are some common trends that are valuable to any large group of employees:

Flexible work options. By far, flexible work options are the most sought-after work benefit today. Widespread research shows that employees want flexibility in where and when they work. Many employees are seeking fully remote positions that allow them to work from anywhere. In workplaces where fully remote options are not feasible, hybrid arrangements that allow employees a couple of days each week to work from home are popular. For jobs that can't be performed remotely at all, flexible work hours, such as allowing employees to work during non-traditional hours or compressed workweeks, is the next best thing. According to research by the Society for Human Resource Management (SHRM), 42 percent of organizations that saw higher or much higher turnover in early 2021 have implemented new or additional remote-work or flexibility options to reduce turnover. See Managing Flexible Work Arrangements.

Paid leave. Paid time off beyond traditional vacation and sick leave can help employees reduce stress and create better work/life integration. Paid family leave has increased significantly since 2019, according to SHRM research, and unlimited or open leave policies that allow employees to take time off as needed with no specific cap on the number of days are gaining in popularity. See Managing Paid Leave During the Pandemic and Beyond.

Financial wellness. More organizations are offering benefits like access to emergency funds and financial planning services. A study by SHRM and Morgan Stanley found that employers who offered these financial benefits indicated that they have been used more since the start of the COVID-19 pandemic. Increases to 401(k) employer contributions and matching are also being used by employers to retain employees. See Unlocking the Full Potential of Financial Wellness Benefits.

Career development. Employees feel more engaged when they believe that their employer is invested in their growth and career development. Employers can highlight career path options within the organization, allowing employees to visualize what opportunities are available. Organizations can also offer development tools such as mentoring and coaching to assist employees in obtaining their goals. See Developing Employee Career Paths and Ladders.

Educational assistance. Investing in employee career growth through enhanced tuition assistance and training programs can pay off. Nationwide restaurant chain Chipotle Mexican Grill reported a retention rate that is three-and-a-half times higher for employees enrolled in the company's generous educational assistance program. See Designing and Managing Educational Assistance Programs.

Mental health and wellness. Workers are seeking employers who care about their employees' mental well-being and invest in training, education, benefits and programs that connect employees with treatment options and mental health care providers. Mercer's 2021 Health on Demand report found that 42 percent of employees with access to mental health benefits said they're more likely to stay at their current organization than if they didn't have those resources. See Creating a Mental Health-Friendly Workplace.

Great pay and health care benefits are fairly consistent drivers of retention. But in today's labor market, that might not be enough. Employers need to think outside the box. Start by investing in comprehensive surveys on employee benefits to identify what perks competitors are offering to lure employees. Or better yet, be a trailblazer and offer benefits that might not be mainstream to set your company apart from others. Some desirable perks and benefits that may entice employees to stay include:

Home office support

  • Equipment allowances.
  • Ergonomic evaluations and equipment.

Pet-friendly perks

  • Pet insurance.
  • Pet sick/bereavement leave.
  • Pet-friendly workplaces.

Onsite offerings

  • Child care centers.
  • Massages.
  • Healthy food options.
  • Services such as oil changes, car washing and dry cleaning pickup/drop-off.
  • Quiet rooms for meditation or prayer.

Wellness support

  • Gym memberships.
  • Sabbatical leave.
  • Ergonomic workstations/standing desks.
  • Health and wellness coaching.

Inclusive workplaces

  • Floating holidays.
  • Employee resource groups.
  • Transgender-inclusive health insurance coverage.
  • Diverse health insurance provider networks.
  • Employee skills training such as American Sign Language or foreign language instruction.

Other

  • Employer-paid food delivery subscriptions.
  • Transportation subsidies and/or ride-share coordination.
  • Student loan repayment assistance.
  • Employee discounts for company products or services.

 

You don't have to be a Fortune 500 company to implement many of these benefits; however, it may take some financial investment to remain competitive in a tight labor market. When there is absolutely no budget to enhance the employee benefits package, employers can find some offerings that are free, but it might take some legwork and creative thinking:

  • Scour the Internet for free options such as TicketsatWork, which provides employees access to discounts on entertainment tickets and other services, or EdApp, a free online employee training platform.
  • Conduct an audit of your health insurance plan for provider diversity and coverage inclusivity.
  • Implement cost-free changes such as converting an unused space into a quiet room.

Ultimately, asking your employees what it is they want, rather than guessing or implementing something just because a competitor is doing it, will be most effective. But don't ask if you aren't ready and willing to implement the suggestions. If a pet-friendly workplace isn't feasible, don't include it as an option. Instead, list only the perks and benefits that could be adopted. Allowing employees to submit additional suggestions can be helpful, but you should include a caveat that not all suggestions will be implemented. Consider mentioning those benefits that might already be off the table.

 

Related reading:

Job Candidates' Expectations Have Changed. How Are Employers Responding?

Employers Use Benefits and Perks to Counter Great Resignation


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