As employers look for ways to better compete for talent and retain high-performing employees, more are turning to total rewards programs to aid in these efforts.
According to Gartner, “Total rewards is the combination of benefits, compensation and rewards that employees receive from their organizations. This can include wages and bonuses as well as recognition, workplace flexibility and career opportunities. Total rewards may also refer to the function or department within HR that handles compensation and benefits, or the combined intrinsic and extrinsic rewards (or value) that an employee perceives.”
Even smaller employers are adding total rewards programs to keep up with changing employee expectations. And a new study from WorldatWork explored trends and data around total rewards programs of U.S. companies.
How are total rewards programs changing?
Total rewards are generally associated with larger organizations, but in WorldatWork’s 2019 Inventory of Total Rewards Programs & Practices, 27% of employers surveyed had between 10 – 999 employees.
The survey first showed some of the programs that were offered more in 2019 than last year. Here are a few examples:
- Diversity and inclusion initiatives – 65% in 2019 (58% in 2018)
- Paid parental leave – 57% in 2019 (52% in 2018)
- Leadership training – 88% (84% in 2018)
- Immunization clinics or promotions – 84% in 2019 (79% in 2018)
Next, healthcare benefits were explored and revealed those that are most commonly offered by employers today. Life insurance, dental plans, and LTD insurance were all offered by 99% of participating employers.
High-deductible plans (82%) and health savings accounts (80%), while less popular than other healthcare options, are continuing to grow in usage by employers and employees.
In addition to traditional medical benefits, the study also explored some of the voluntary and more modern health benefits offered by employers today:
- Employee assistance programs (EAP) – 97%
- Immunization clinics – 84%
- Wellness programs – 76%
- Health coaching – 74%
- Health advocacy programs – 61%
Paid time off, retirement benefits, and voluntary benefits
One of the biggest workplace perk trends in recent years has been the revamping of paid time off (PTO) policies by employers to better compete for talent. WorldatWork’s survey took a closer look at the types of PTO that employers are offering to their workforce:
- Floating holidays – 58%
- Paid parental leave – 57%
- Sick leave – 56%
- PTO to volunteer for individual effort – 35%
- PTO to participate in school activities – 17%
When it comes to retirement benefits, 98% of employers offer a defined contribution plan to their employees. These include 401(k), 403(b), and 457 plans.
Voluntary benefits are also growing in demand and use by employees, and it’s becoming much more common for employers big and small to offer these perks.
According to the survey, some of the most commonly offered voluntary benefits include:
- Employee discount programs – 73%
- Personal financial planning services – 56%
- Legal insurance, referral or consultation – 45%
- Identity theft insurance – 34%
- Pet insurance – 33%
- Long-term care insurance – 32%
- Auto/home insurance – 27%
- Student loan assistance – 9%
Small employers can implement their own total rewards initiative
Small businesses who are struggling to recruit job seekers or seeing an increase in employee turnover can look for ways to improve their benefit packages to better compete for talent.
And while establishing a complete total rewards program may not be feasible, taking components and ideas from them to create your own enhanced offerings can be a step in the right direction.
Exploring HR partnerships to improve benefit offerings is one-way small businesses leaders can do just that!
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