Total Rewards Information for Small- & Mid-Sized Businesses

For small- and mid-sized businesses, getting competitive information to develop the benefits programs that make up an employee total rewards package can be difficult. PBO Advisory Group solved that problem by conducting a survey of our clients regarding their benefits and total rewards packages. The full scope of the findings were then shared with the participants.

For those companies that did not take part in the survey, we offered some abbreviated information, presented at our recent webinar.

To give you an idea of the demographics of the survey respondents, 50% had under 50 employees. The industries represented include life science, professional services, private schools, technology, manufacturing and distribution, real estate and property management, construction, nonprofit and retail.

Health Benefits

Panelist Sean Greene of Morrison Insurance advised that you must be aggressive when offering employees certain benefits, including healthcare. Our survey showed that 91% of the respondents offered health benefits and 42% paid the employees’ premiums.

A good starting point for companies looking to offer or expand health benefits is to determine what the company is willing to invest in this area. A broker can help by conducting an assessment of your current coverage and then providing a summary of what is available in the marketplace. Additionally, a brokerage can assist with internal communications to ensure employees understand what is available to them.

PBO Advisory’s Chief People Officer Nicole Devine, noted that from a total rewards benefit perspective, it is important to consider the work that your employees do and provide benefits that mirror their needs. For example, nonprofit organizations often provide emotionally charged services, so their employees need access to good mental health coverage.

She also recommended asking your employees what they need and want regarding health benefits and then build a program for them. When possible, getting data points about what other companies in your market offer will help you stay competitive.

Paid Time Off

Our survey found that 76% of participants offered some form of paid time off, however, there was a broad range of what this covered and how much is granted — some companies even offer an unlimited amount. Kristy Facchini, PBO Advisory’s consulting CFO, cautioned that when developing a PTO plan, it is important to work with an employment lawyer or professional who understands the sick leave rules by state and county. While PTO plans do have mandatory requirements, there is flexibility for you to include parameters into your PTO policies.

Nicole noted that some companies, to be competitive, put in place a PTO program without thinking through the impact, including the financial aspects. For example, when shifting to a new policy, often there is a payout to employees for time previously on the books. Be sure to fully research and weigh all impacts of PTO.

Retirement Benefits

Retirement benefits are one of the greatest total rewards benefits when it comes to attracting and retaining employees. According to Kristy, 82% of our respondents offer such benefits and 75% also offer a matching component, which varied widely among the participants. This can be one of the best tools to start your total rewards discussion with potential employees.

Our survey also found stock options were offered by 20% of those surveyed. Kristy added this is more often seen in reward programs from VC backed companies.

Alternative Rewards

Beyond the benefits discussed above, there are other programs that can be added to a total rewards program. Our survey found that 36% of the companies that participated offered a bonus program. These programs varied from management only to the entire workforce.

Nicole also mentioned, alternative work schedules; education benefits, including paying down/off student loans; extra paid time-off for such activities as team building, mission-driven volunteer work and more; and retreats.

Kristy advised that understanding your employee base is important when it comes to alternative rewards so you are not wasting money on benefits that your team doesn’t want.

Understanding Total Rewards

Nicole noted that when it comes to attracting and retaining employees, there is a longer-term perspective beyond compliance when building and evaluating a total rewards program, which includes staffing to understand and administer the program and the financial modeling of the program. Additionally, it is important to look at a total rewards program in full, as an integrated package vs. separate programs.

Kristin Pantle, PBO Advisory’s senior finance consultant and human capital advisor who moderated the webinar, suggested repeating educational training about your benefits often to ensure employees understand what is being offered. If they don’t understand, they will not take advantage of the total rewards benefits. This can be done not only in a training format but also during check-in meetings with supervisors, during performance reviews and even via text. Nicole suggested that you look at the ways you currently communicate with your employees and then include total rewards education into those.

view webinar

For more information about total rewards, please contact Nicole Devine.


Nicole Devine
Consulting Chief People Officer
nicole@pboadvisory.com
858-622-1681 Ext. 287