Employees Value Benefits and Job Security the Most
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According to a recent report from the Society for Human Resource Management (SHRM), employees consider benefits and job security as the two most important factors that contribute to their overall job satisfaction. This marks the fourth time in as many years that these two factors topped the SHRM's annual Employee Job Satisfaction survey.
Employers who want to see their employees’ job satisfaction increase should consider providing informative communication regarding the benefits package they offer and the personalized cost value of those benefits. Employee benefit statements often include a personalized letter from top management which may be used to communicate a sense of security regarding the stability of the company and employees’ jobs.
The survey also polled HR professionals on their thoughts about job satisfaction, and found similar results. HR professionals agreed with the employee population on the value of job security, positioning it as their second most important factor. An astonishing 72% of the HR population polled, selected the employee-supervisor relationship as the most important factor effecting job satisfaction, ranking number one in the survey for the seventh time in the last eight years. In comparison, only 48% of employees polled selected "relationship with supervisor” as an important factor, ranking it seventh on the list.
The 2010 survey was made up of 25 elements spread across four categories, and included factors regarding wages, benefits, work environment, and advancement opportunities, among others. To ensure the validity of the survey's results, the SHRM polled a wide sample of over 600 employees and 589 HR professionals, all from the United States.
This year's survey had other interesting results. Employee compensation fell to its lowest rank ever this year, coming in at fifth on the employees' poll. Last year, compensation fell out of the top five rankings for HR professionals, and this year it was listed as the ninth biggest contributor to job satisfaction.
Besides job security, employees and HR professionals appear to agree that having opportunities to utilize skills/abilities while at work contributes to overall satisfaction. It is the third consecutive year this factor has ranked in the top five in both surveys, with employees placing more emphasis on this choice in 2010 than in previous years.
SHRM included a new choice in this year's survey that received a lot of attention from both sides of the table. For the first time in the survey's history, participants could select "organization's financial stability” as a key contributor to job satisfaction, receiving enough selections to rank fourth on both surveys.
As for employee benefits, a secondary survey revealed that health care coverage was the most important benefit, followed closely by paid time off. Despite the amount of significance employees' place on benefits, only 38% of employees polled felt "very satisfied” with their current medical benefits. Conversely, the majority of employees were very satisfied by the amount of paid time off being received.
Some employers are concerned about how health care reform could affect the benefits they offer, which could also affect job satisfaction. On the brighter side, this year's employee survey showed that "the work itself” was selected enough to tie for fourth, pointing out that satisfaction does not only come in the form of paychecks and paid vacations.
Show Employees Their Hidden Paychecks
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Show Employees Their Hidden Paychecks
A top-notch workforce is essential to your company’s success. It’s always important to have engaged, loyal employees, and in an economic downturn, it’s more critical than ever to keep employee morale high to maintain the competitive edge top-quality employees bring.
One way you keep your best employees on board is by offering a generous benefits package. But do your employees fully appreciate your investment? According to many surveys, they don’t. Employees tend to focus on their share of the costs, and many grossly underestimate the amount their employers pay. Employees also tend to underestimate what employers pay for other benefits such as paid time off (PTO), tuition reimbursement, pension or 401(k) plans and statutory benefits like employer-paid Social Security.
So how do you make sure employees know and appreciate how much you spend on their benefits – traditional benefits like health, dental and life insurance as well as benefits like PTO and statutory benefits? Communication is the key.
One of the most effective ways to drive home the point is to present the full costs of all the benefits you provide as an employer in the form of a “hidden paycheck" or a total compensation statement. For example, if you pay an average of 20% of an employee’s salary on providing a traditional benefits package, an additional 5% on matching 401(k) contributions and approximately 10% each on PTO and statutory benefits, you could provide a “hidden paycheck” communication or benefit statement outlining the following for an employee who receives an annual salary of $50,000:
YOUR HIDDEN PAYCHECK
$50,000 in salary
$10,000 in employer contributions for health, dental and life insurance
$5,000 for time off
$2,500 in 401(k) contributions
$2,500 for statutory benefits
$70,000 = TOTAL COMPENSATION
Of course, the amounts will vary depending on how much you contribute to employee benefits. But as you can see, even with fairly conservative estimates, the amount is significant. A hidden paycheck communication gives employees a big-picture view and increases their appreciation for employer contributions.
There are a variety of ways in which you can present hidden paycheck information. It can be as simple or elaborate as you choose. At myBenefitStatements, we have a number of formats available (click here for sample formats). Or you could make it an annual tradition, presenting hidden paycheck information or a benefit statement at year-end in the form of an annual total pay statement for every employee.
No matter how you choose to convey the information, revealing hidden paycheck amounts is a worthwhile endeavor. It can help you get the word out about how much you actually spend, raising employee awareness of your investment in your human capital. It can build valuable good will, which is a critical commodity, especially in times of economic hardship, when your need for a competitive edge is greatest.
A Look at Healthcare Reform’s Impact on HSAs and FSAs
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If your company currently sponsors a flexible spending (FSA) or health savings account (HSA) to allow employees to pay out-of-pocket medical expenses with pre-tax dollars, be prepared for upcoming changes.
Under the new law, maximum annual FSA contributions are reduced, and there are new regulations affecting how the funds can be used. The intent of the new rules and penalties is to generate revenue which can be used to fund aspects of the health care reform package.
FSAs and HSAs (assuming the employee is covered under a qualified high deductible health plan) allow an employee to contribute tax-free funds that can be used to pay for deductibles, drug co-pays, treatments that are not covered by health insurance, and other qualified medical expenses.
Beginning on January 1, 2013, the annual limit for FSAs will be set at $2,500. Previously, the IRS had stipulated that employers could establish their own FSA contribution limit, and according to the Center on Budget and Policy Priorities, these limits generally fell into the $2,000 to $5,000 range. In 2009, Mercer’s National Survey of Employer-Sponsored Health Plans stated that the average yearly employee contribution was $1,424.
Annual limits for HSAs, however, were not affected by the new legislation.
Be aware that some restrictions will become effective more quickly. For example, as of January 1, 2011, FSA and HSA participants will no longer be able to spend the funds on over-the-counter medications unless a physician has specifically prescribed them. Also starting next year, non-qualified withdrawals from HSAs will be subject to a 20% penalty instead of the 10% penalty which is currently applied.
Our sister division can help you with all your FSA, HRA and HSA questions. Click over to myCafeteriaPlan.com to learn more about how we can help you communicate with your employees.
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