More Information About Starting Your Small Business
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Employee Benefits |
Employee benefits have a significant
financial and administrative impact on a business. The educated
American work force has come to expect a comprehensive benefits
program; the absence or inadequacy of such a program can seriously
hinder a company's ability to attract and retain the best personnel.
Designing the right benefit plan for your employees is a complex
task that includes taxes, legal aspects, funding, and selection
of vendors or administrators. |
What is an Employee Benefit Plan?
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An employee benefit plan protects
employees and their families from economic hardship brought about
by sickness, disability, death, or unemployment; it provides retirement
income to employees and their families; and it provides a system of
leave or time off from work.
A comprehensive benefit plan can include health insurance, disability
insurance, life insurance, retirement plan, flexible compensation
(cafeteria plans), and leave from work. Broadly defined, a benefit
plan can include other components such as bonuses, service awards,
reimbursement of employee educational expenses, and other benefits
appropriate to employee responsibility. |
Why Offer Your Employees Benefits?
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Here are some of the reasons
employers offer benefits:
- To attract and hold capable personnel.
- To keep up with competition.
- To foster good morale.
- To provide opportunities for advancement and promotion as older
workers retire.
A combination of benefits programs is the most effective and efficient
means of meeting employees' economic security needs. For many employers,
a benefit plan is an integral part of total compensation, because
employers either pay the entire cost of a benefit plan or have employees
contribute a small portion of premium costs for their coverage.
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