How to Improve Employee Retention – Part II: Your Benefits Suck

How to Improve Employee Retention – Part II: Your Benefits Suck

Hello everybody and welcome back to our series on employee retention. Last week we talked about the first reason why your employee retention sucks (because your HR sucks)  and what you can do about it. If you haven’t read it yet, I encourage you to do so here.

But that is far from the only reason employees leave a business, and this one is a huge issue for small business owners.

Simply put, your benefits suck.

Of course, there’s very little small businesses can do about that. Large businesses will always be able to offer more benefits than small businesses can, and unless we can completely readjust our government to even that playing field, we’re kinda stuck.

But that doesn’t mean that we can’t offer benefits at all to our employees. Folks are usually happy to stay with a small business as long as the basics are covered. That includes health care, a 401k, and vacation.

But most importantly healthcare…

Like, it’s not even close…

Whether you like it or not, people will be looking for jobs that offer health care, and will always leave a job that doesn’t have health care for one that does. While it is treated very much like a luxury, it’s important for us as business owners to take a step back and really think about how important that “benefit” is, and maybe it will help us understand that it’s actually a necessity.

Let’s say you have diabetes and you’re looking for a job. You get two offers, one pays 30 dollars per hour, and the other pays 22. A huge difference right? You’d have to be reckless to take the 22 dollar gig. But the catch is the 22 dollar gig has healthcare and the 30 dollar gig does not.

For someone with diabetes, here is what they would pay for insulin with and without insurance.

With insurance: $15-100 per month

No insurance: $500 per month

So let’s get some information straight here. If this person doesn’t find a job, and they don’t have any other support system, they could die. There is no system to protect them and death due to inability to afford insulin is tragically common in the U.S.

The $30/hr job will still leave you with more money in the end, but not by much. And let’s say, on top of diabetes, you go to the emergency room. Under insurance, you might have to pay a few hundred at most, but for the uninsured, one trip can cost thousands.

In this mindset, you can’t blame anyone for not taking or keeping a job because you don’t offer healthcare, and the looming threat of knowing that you can die from getting sick because you can’t afford treatment is always going to be an unnecessary stress on your business.

I get it, if you’re too small you just can’t afford to offer those benefits. In that case, I would focus on creating as safe and welcoming environment as possible. Focus on hiring younger folks and giving them the skills they need to develop move on to bigger things in their careers. Many will stay with you and be very honest about exactly when and how they plan to leave.

But if you have the ability to offer this benefit to your employees, go for it. Not only will they be grateful for this security net you gave them, but they will also know that they are risking something if they decide to leave your business.