Indirect financial compensation refers to optional, non-wage compensation provided to employees in addition to their normal wages or salaries. These benefits may include group insurance (health, dental, vision, life, etc.), disability income protection, retirement benefits, childcare subsidies, tuition reimbursement, sick leave, vacation (paid and non-paid), and education funding.
In today’s hiring market, employees want comprehensive benefit plans that are tailored to their individual needs. Though benefit plans can be expensive, providing a comprehensive plan has many advantages for both employers and employees, including increased workplace satisfaction, financial security for employees, and increasing the employer’s ability to retain and attract talent.
Tailoring benefits to your staff needs and being creative will improve the quality and access of your benefit plan. This can include:
- Allowing employees to access their group benefits as of their hire date
- Allowing both permanent and contract staff to be eligible for benefits as well as full-time and part-time status employees
- Being able to accumulate sick days as a bridge to disability coverage
- Offering personal days in addition to sick and vacation days to ensure that employees have work-life balance
- Allowing employees to take their birthday off with pay
- Allowing for some increased flexibility in personalizing benefit options, such as health spending accounts, vision care versus dental, and more paramedical coverage
- Offering a top-up for new parents going on pregnancy/parental/adoption leaves
- Allowing employees to contribute to a pension or RRSP program from the start date of employment
Working with a benefits broker or consultant
When determining the best benefit carrier/insurer for your organization, working with a benefits broker or consultant is key. Brokers and consultants are knowledgeable with insurers for all areas of coverage including health, wellness, dental, life, disability, long-term care, and voluntary benefits. These professionals can provide you with quotes from multiple carriers with different plan designs.
Some questions to keep in mind when choosing a benefits broker or consultant include:
- What are the services they will provide your organization in an effort to build and manage your employee benefit program? Do they provide employee support?
- What is their fee schedule?
- Are they local or national?
- Are they licensed?
Choosing your benefit plan design
To start the process of designing a comprehensive benefits program you need to define the program’s objectives. This will provide a guide to creating a program that meets both the needs of the employer and employee. Factors such as employer budget, total employees, location, sector, employee feedback and collective bargaining agreements should be considered in the development of the benefits objectives and should be tied to the organization’s compensation philosophy.
Benefits Objective Template
[COMPANY NAME] is committed to creating and maintaining a comprehensive employee benefits program based on employees' needs for [insert needs relevant to your organization].
Promote your benefits plan
Now that you have a great benefits program, don’t forget to promote it! Ideally, communication should not be a “one and done” at the time of enrollment but instead be continuous. Nonprofits should constantly educate employees about the benefits and retirement options sponsored by the employer. Showcase that you value your employees by spotlighting your benefit programs through emails, company intranet, posters in the office, facilitating webinars, educational resources, and staff meetings.