Key Benefits That Will Aid Employee Retention
In addition to offering employees a fixed salary, many employers also choose to provide their workers with benefits. Benefits are defined as any nonmonetary form of compensation offered to an employee. These can take many forms, ranging from use of a company vehicle to the receipt of paid time off. Many employers offer these benefits as a means of retaining employees. Some kinds of benefits are more effective than others at accomplishing this goal.
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Health Insurance
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One of the benefits that employees most prize is employer-provided health insurance. Indeed, one of the chief concerns of employees leaving a job, either voluntarily or involuntarily, is where they will receive their health care. Generally, individuals who are able to receive health insurance from an employer are able to receive coverage at a far less expensive price than they could receiving a policy as an individual. Health benefits can therefore greatly increase employee retention.
Vacation
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One of the best benefits that an employer can offer is payment for not working. Many companies choose to provide full-time employees with a period of paid vacation. In addition to allowing employees to take certain national holidays off, many employers allow employees to arrange vacations throughout the year. Generally, more senior employees are awarded more vacation time. This provides employees with an incentive for staying with a company for a longer period of time.
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Retirement Plans
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Many companies also offer employee retirement plans. Retirement plans can take several forms. Some employers offer pensions to employees who have been with the company for a long period of time, generally two decades or more. This provides a strong incentive to employees to remain with the company for a long period of time. In addition, many employees will match an employees contribution to his 401k plan.
Stock Ownership
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Many companies either give employees company stock or offer employees the right to purchase it at a certain price, usually slightly discounted. This accomplishes two goals. First, it provides the employee a fungible asset in addition to his current salary. Secondly, it strengthens the ties between the employee and the company. By reaping dividends from the company's success, the employee is inspired to work harder and, potentially, to remain with the company for a longer period of time.
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