Best Workplaces Focus on Benefits and Culture

When you compile a list of what makes an organization a "Best Company" to work for, stability, trust, and a respectful corporate culture conducive to strong job performance all are weaved into a mosaic that is most attractive to prospective employees.

In the view of human resource executives, it all comes down to how valued your employees feel. "If I were going to name three or four things that seem to be the most desirable, I'd say employees feeling valued by employers is right up there," said Mike Leibundgut, president of the Greater Madison Area Society for Human Resource Management. "That means managers and owners care about their employees, rather than look at them as numbers."

In many ways, a strong benefits package says volumes about corporate culture. As Leibundgut explains, the package doesn't have to include the best pay, nor does it have to involve the most generous benefits. It means "having a good, holistic approach where you offer reasonable wages that are competitive with your industry, and good and reasonable benefits that people need at a decent price, if not free."

This article will not focus on legally mandated benefits such as Family and Medical Leave Act requirements, which are governed by applicable federal and state laws, but will instead focus on things employers can control. For salaries and wages, Leibundgut recommends survey data produced by organizations like GMA-SHRM, or industry-specific surveys produced by organizations like the Wisconsin Bankers Association. If your business is national or international in scope, your search should focus on surveys that cover different regions where you have locations.


Bennies from heaven

Health care benefits are considered the low-hanging fruit of the benefits package, but there are different levels. While a 100% employer cost share obviously is the ideal, economic realities, even in a metropolitan area where health premiums tend to rise less than the national average, mean the most common cost-share breakdown is an 80% employer-20% employee for individual and family plans, and the normal range is somewhere between 70% and 90%.

In terms of deductibles and coinsurance, "The most common single deductible is $250," noted Laurie Kelly, a benefits administrator for Park Bank. "The most popular coinsurance level is 80/20, followed by 90/10."

"Best Companies" not only keep co-payments or deductibles low for health coverage, they pick up most of the cost for dental and vision coverages. "Usually, it's very similar to the health insurance breakdowns," Leibundgut stated, "but I've also seen where dental insurance is offered at a lower percent, maybe 60% or 65%, and some only pay for the associate that works there, not their family members."

There are many options for setting up these coverages. In some cases, an organization might be in a strong enough position to have an 80-20 split for each type of coverage, or pick up more (85%) for health insurance but only 50% for dental and vision.

Kelly said a lot of dental plans will fully cover two cleanings a year, with additional coverage for basic and major restorative services. "Systemic medical problems are going to appear in your mouth before they appear in your body," Kelly noted, "so it makes sense for employees to have their teeth cleaned and checked more frequently so that you can keep the overall costs lower."

Paying for annual flu shots for employees and covered family members is another way to show workers how much they are valued, and reduce lost productivity.

Wellness programs are designed to provide financial incentives for healthy behavior – regular exercise, smoking cessation – and address behaviors that add to coverage costs. If employees do the right things to stay healthy, employers might require them to pay 10% less toward their premium, so it's more of a carrot than a stick. The best way to evaluate return on investment in wellness programs is to measure improved health outcomes and reduced costs for previously unhealthy workforce populations.

Flex benefits: Some employers give workers the option of working longer hours Monday through Thursday in exchange for time off on Friday afternoons, but there are several possible "flex-time" arrangements. Leibundgut believes such arrangements are the exception, not the norm, in part because businesses such as bank branches need to remain open until 5 p.m. each day in order to serve customers. "That is a pretty important benefit that not everybody can offer," he noted. "If you can find a real flexible work schedule with both children and aging
parents, I think that's a very nice thing to offer. Not everybody needs that because 8 to 5 works for some people, but you can mix and match."

Previously separate benefits like vacation and sick pay often are rolled into various allotments of "paid time off." A PTO plan takes those various components and combines them into one bucket, which is simpler to administer and represents a "no-questions-asked" plan in which employees don't need documentation from a physician for sick days. Since some employees have accrued more vacation time or time with the company than others, the size of the bucket varies. In companies that offer sick leave as a separate benefit, the traditional three days per year has been raised to six days.

Some companies offer flexible medical spending accounts for dependent care or child care. It is an optional federal program in which employees can put money away, pre-tax, to pay daycare or medical expenses. Contributions to Medical Flex accounts are unlimited by law, but most companies set their own annual contribution limits anywhere from $3,000 to $5,000. There is a maximum deferral for dependent care, which is set at $5,000.

Retirement benefits: The 401(k) account is still the most common option available for building employee retirement savings. In the typical 401(k), employees can put up to 6% of their income into investments, and most employers "match" anywhere from 50 cents to $1 of each employee's contribution. "Matching depends upon the employer, but it's not uncommon to see 50 cents on the dollar up to the first 6% that you offer," Kelly said. "Other plans will match dollar for dollar to the first 3%."

Although bonuses aren't necessarily considered retirement savings, Daniel Guerra Jr., founder and president of the consulting firm Argus Ventures, thinks bonuses are a reasonable substitute for 401(k) matching. "I think we're going to end up driving toward more of a profit-share model than a 401(k) match," he stated. "One of things we want to do is share the upside with employees."

Life insurance: Companies that offer life insurance can set up policies to match whatever the employer can afford. Some companies offer life insurance at no cost to employees, with the coverage amount set at double the employee's annual salary. In some cases, covered employees have to pass some kind of health examination, but not always. "Typically, if you get that benefit as a new employee through a group plan, you would not have to have a health screening," Kelly said.

Education: Leibundgut is not certain of the exact percentage, but he knows that a fair number of employers offer educational development such as paying for a degree program. Some who don't go that far offer help with a certificate or a license or an online class to improve job performance, and they also assist with scheduling. "Many employers are going to be looking for that degree, in whatever program you are working on, to be applicable to your current job," Kelly noted. "They are going to be looking for certain grades. They want you to get an A or a B, and work out payment arrangements with the school where the employee would put their class in an account when they are finished with the class and they have achieved the required grade. Then the employer would reimburse the school at that time, rather than paying upfront."
In addition, professional development might also include job shadowing, or a chance to assume a leadership role in a company event.

Transportation: Most companies pay for mileage accrued in the commission of work, "but paying people to come to work and back, I haven't heard a whole lot about that," Leibundgut stated. "That would be an exceptional benefit." When help is offered, it's usually subsidizing a bus pass or providing community car access. "Of the cases I have heard, the most common is some kind of portion of payment for a bus ticket," Leibundgut said. "I've also heard that companies have coordinated car pooling."

Disability insurance: Most companies offer long-term disability, and a good number offer some sort of short-term disability, but at different levels. It's not unusual for an employer to pay for 100% of an employee's long-term disability but a smaller portion, usually between 60 and 80%, of short-term disability insurance.

Spouse/domestic partner benefits: Spousal benefits are extremely common, especially for health insurance, but domestic partner benefits increasingly are becoming an option in Greater Madison. Kelly noted that employers can choose to extend benefits to domestic partners, even though it's not required by state law. "There are some companies that do," she said, noting they basically provide the same benefits to a domestic partner that they would to a spouse.

With gay marriage not permitted under state law, and provisions of the Defense of Marriage Act to consider, companies most often wrestle with the eligibility question, which pertains to a gay couple's level of commitment. "One of the qualifiers is they must have the same residence for a certain amount of time, either six months or a year," Leibundgut noted. "The other is that you can get a domestic partner certificate to show that you are a long-standing couple."

Community investment: A common approach is paying for a set amount of hours of paid company time for employees to devote their time, skills, and knowledge to charitable organizations. Guerra is working on the components of a Web-based Healthy Work Place Initiative; community investment will be a category. "What we were trying to quantify," Guerra said, "is, do you suck from the community, or do you contribute to the community by giving something back?"

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