Instituting a voluntary benefits program within your organization lets your employees determine which specific set of benefits works best for them. They can then supplement your standard benefits package with offerings pertinent to their specific set of circumstances.
Even better, you can provide them with these perks with little to no effect on your revenue stream. Here’s how understanding voluntary benefits programs can save you money, boost morale among your ranks and improve your retention rate.
What Are Voluntary Benefits?
In the simplest terms, these are services (and sometimes goods) offered by an employer of which employees can take advantage at a reduced cost. Imposing little to no direct costs on employers, these programs are also sometimes referred to as employee-paid benefits or supplemental insurance.
Workers pay through payroll deductions, which have the added benefit of tax liability reductions in some instances. Some voluntary benefits packages can be paid for with pre-tax dollars (such as 401(k) contributions).
Examples of Voluntary Benefits
Programs tend to fall into specific categories: health, lifestyle, financial, security and personal benefits.
Let’s take a look at each one in a bit more detail.
Health benefits includelong term care insurance, accident coverage, ambulance and emergency transportation, access to telehealth resources and disability insurance. Dental coverage incorporates sealants, tooth extraction, crowns and dentures. Vision plans cover eyeglass prescriptions, contact lenses and Lasik procedures.
Lifestyle-related offerings usually include services such as fitness club memberships and the retention of legal counsel for personal matters.
Financial programs can incorporate tax assistance, financial planning, investment advice, student loan repayment programs and retirement plans.
Security considerations are comprised of coverages such as life insurance polices and theft insurance.
Personal benefits incorporate flexible scheduling, remote work opportunities, pet insurance and travel insurance.
These are just a few examples of the types of voluntary benefits on offer. Many others are available to deliver direct savings to your workers, dilute the financial risks they’ll encounter and most importantly, endow them with choices reflective of their personal preferences. This is very difficult and quite expensive to accomplish with traditional benefits programs.
Advantages of Offering Voluntary Benefits
In an age in which people have more options than ever in terms of employment opportunities, it’s important to offer compelling reasons for people to choose to work for your company. In other words, you must go beyond salary to present an enticing argument for joining your company.
Voluntary benefits programs can help present a more competitive image against rivals with deeper pockets. In addition to helping you attract solid talent, a good voluntary benefits package can help you keep them. These perks also serve to keep workers loyal to your company and — most importantly — invested in outcomes. And, as we mentioned earlier, this is all doable at low or no direct cost to you.
Employees pay for the services they elect with payroll deductions.
Advantages of Electing Voluntary Benefits
In addition to the pluses we listed above, employees also win with voluntary benefits because they’ll pay less for the services they choose through your program than they would seeking them on their own.
Moreover, in-program providers will already have been scrutinized for competence and veracity, which makes them safer choices for the people who work in your organization. Many of these services imbue employees with an added margin of protection from financial woes and can deliver tax reductions as well.
Understanding Voluntary Benefits
Clearly, choosing to offer a voluntary benefits program to workers holds advantages for everyone involved. The key is getting a solid idea of the types of benefits from which your employee population can most benefit and developing your program to meet those needs.