Employee benefits are currently viewed as somewhat of an old fashioned practice. This is mainly due to the fact that employers are more comfortable to transfer responsibility to the employee. In addition, the administration of a pension fund has become too burdensome.
Solutions have however evolved and we are confident that this old fashioned practice is about to become more popular as the pains of the past are no more. Please join us to explore a series of blogs on why employee benefits could give you the edge as a preferred employer.
Here are five reasons why employee benefits will benefit your business:
- Improved employee recruitment and retention. Benefits are a valuable tool for both attracting and keeping top talent. Remember, your competitors — whether they are big businesses or small businesses — compete not only for customers but also for employees. Providing benefits puts your compensation packages on par with some of your competitors and may help you surpass others.
- Improved wellness and productivity. Benefits such as retirement plans give your employees peace of mind. All of this means that employees are less distracted and more productive when they are at work.
- Cost advantages. The efficiency of a group scheme means that benefits are provided to employees at a much lower cost compared to the acquisition of the same benefits as an individual in the retail market.
- Tax advantages. Employees can deduct pension fund contributions from tax. Sec 11F of the Income Tax Act allows employees to deduct pension fund contributions up to 27.5% of their taxable income or remuneration (to the maximum of R350 000 per year). This benefit is immediately available to employees as processed on the company’s payroll.
- Positive culture. Harvard Business Review did some research on creating positive workplace cultures and found that two of the major principles are caring for colleagues as if they were friends and providing support when others are struggling. While you should aim to do that in your personal interactions with your employees, setting up insurance and retirement benefits can also send that message.
Each of the pros outlined here translates to growth for your business and significant benefits to your staff. Being able to recruit top-tier talent means you have the most-skilled people carrying out the day-to-day and big-picture strategies that make your business successful. Making sure talent is happy and healthy means they can focus on executing those strategies and a more positive culture leads to a more productive and successful business.