Employee benefits benchmarking is a process where companies compare and evaluate their employee benefits packages against those offered by other companies in the same industry or region. Businesses do this as a competitive advantage strategy as well as to find new cost-effective options. There are several benefits to benchmarking as it is a valuable tool for companies to be able to optimize their benefits packages to meet the needs of both the company and its employees.
Competitiveness – Benchmarking helps a company to better attract and retain top talent through offering benefits that are competitive with industry standards and market others.
Costs – When organizations identify cost-effective benefit strategies, it allows them to better manage their budget, while still offering the employee benefits that workers want.
Compliance – The process can also be used to mine benefits data to ensure that the benefits program complies with legal and regulatory requirements.
Satisfaction – This is an opportunity for a company to take a look at its benefits program and decide whether to make changes based on the preferences of the workforce. It’s a great way to refine a benefits strategy and increase employee satisfaction.
Planning – The data collected from a benchmarking survey can be useful later on in life. It can be considered valuable information for long-term strategic planning.
How to Perform Benchmarking
Your organization should detail information about its employee benefits program. Include the types of benefits that are offered (health insurance, retirement plans, paid time off, etc.) coverage levels, cost-sharing arrangements with employers, and other pertinent information.
Select a group of peer companies or organizations that are of a similar size. You’ll also want to make sure these companies are within the same industry market trends and location, if possible. These peers will serve as the benchmark against which your organization’s benefits will be compared.
Next, you will compare your organization’s benefits program data to that of the businesses within the peer group. This step is critical as it will identify trends and areas where your organization’s benefits package may be more generous or less competitive than other companies.
Once you collect all of the necessary information, analyze all the data and results to gain insights into how your organization’s benefits programs compare. The analysis process should reveal strengths and weaknesses in the current benefits package.
Making a Decision
Decide whether to make changes to the employee benefits package. You may want to determine whether to adjust benefits offerings, contribution levels, or other aspects to make your company’s offering more competitive. A decision may also be made with cost-effectiveness in mind.
Which Employee Benefits Should I Benchmark?
When conducting employee benefits benchmarking, it’s important to select benefits that are the most relevant to your workforce. It can be common to do a benchmark report on a range of benefits, but you should prioritize your organization’s goals and resources. Here are some employee benefits you may want to consider benchmarking.
Health Insurance – Look at the type of health insurance plans offered, coverage levels, premiums, and employee contributions. Explore the range of medical, dental, and vision benefits.
Retirement Plans – Evaluable the types of retirement plans (401(k), pension, etc.) and the employer’s contributions or match. Be sure to consider vesting schedules and plan options as well.
Paid Time Off – Thoroughly analyze the paid time off policies, including vacation days, sick leave, and holidays. Notice how these policies compare with industry standards, competitors, and other companies within your region.
Family and Parental Leave – Take a close look at these policies, including maternity and paternity leave, along with adoption assistance, and access to childcare support.
Bonus and Incentive Programs – Compare bonus structures, performance incentives, and how benefits compare to other reward programs.
Relocation Assistance – If your business deals with relocation, benchmark policies related to moving expenses, temporary housing, and other relocation benefits.
Professional Development and Education – Examine tuition assistance, reimbursement programs, and other opportunities for employee education and training.
Improving Your Employee Benefits Packages
Employee benefits benchmarking empowers an organization to evaluate its own benefits program in the context of industry standards. Alltrust Insurance recognizes the significance of benchmarking as it allows our clients to remain competitive and successful.
With our employee benefits program, we can help your company retain and attract top talent, encourage employee satisfaction, and drive success. We can support businesses of any size and have many resources to support you. We are one of Florida’s leading employee benefits and HR consulting firms. We represent every major medical provider in Florida and beyond.
Please contact us to get started. We look forward to partnering with your company!