Voluntary Benefits Have Become Essential

Employees are demanding voluntary benefits more than ever before. Employers are finding that voluntary benefits, (Also known as Worksite Benefits or Enhanced Benefits) are now essential to attracting and keeping employees during this period of competition for top employee talent.

Employee benefits have long been an integral part of compensation, but much higher medical deductibles coupled with a desire by employees for customized benefits, have pushed voluntary benefits to the forefront of total compensation packages. The best news is that they are offered at little to no cost to the employer. Let’s take a closer look at what voluntary benefits are, their advantages and how they are implemented:


What are Voluntary/Worksite Benefits?

Voluntary benefits are enhanced or additional benefits that are offered to employees on a mostly or 100% employee paid basis. Voluntary benefits are typically offered on a “menu” of benefits designed to fill holes in coverage or provide coverage for specific needs. Examples of typical benefits offered as voluntary are:

  • Disability
  • Dental
  • Vision
  • Critical Illness
  • Cancer coverage
  • Pet Insurance
  • Supplemental Life
  • Hospital Indemnity
  • Disability
  • Legal Aid


Tax Advantaged

The cost of voluntary benefits can be paid pre-tax when employers offer the benefits through payroll deduction. While this is certainly a substantial benefit, it’s important to note that employer payroll taxes and workers compensation payroll are also reduced by the amount of the pre-tax contribution. This is a win-win for employers and employees.


Fills Gaps in Coverage

Employees can get coverage through their employer that is not available on an individual basis. The cost of group voluntary coverage is also significantly lower than any coverage they may qualify for on their own. With the average comprehensive medical plan deductible approaching $2000 an individual, plans that offer first-dollar coverage for accidents and critical illnesses can help relive the financial of many employees. Even if 100% employee paid, dental and vision plans are relatively inexpensive and highly-valued by employees.


Increases Employee Satisfaction and Retention

Surveys confirm that employees are more satisfied with their benefit plan when they have options. While a company’s base employee benefit plan may be good, offering valued benefits at little to no cost to the company is an easy way to stand out from the crowd when competing for employees.


Communication and Enrollment

Communication is key to the success of a voluntary benefit plan. A well-timed, multi-pronged approach is most effective for reaching employees without burdening them with information overload. Human interaction, educational meetings accompanied by concise print and email communication will maximize employee engagement and enrollment. Make sure that all employees have a chance to learn and ask questions about their choices. Short-cuts in communicating and enrolling benefits will result in poor participation and reduced employee satisfaction.


About the author: Gregg Kennerly is a Principal at Advanced Benefit Strategies of Virginia, which designs and implements innovative corporate health care plans. Reach him at [email protected] or 757-536-4554. www.absofva.com

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