Employee Benefits Strategies

What benefits do other organizations offer?

Other considerations in benefit planning should include benefits practices among other industry and geographic area employers. To attract and retain employees, an employer must:

• remain competitive with other employers within the local market and
• understand what benefits competing employers are offering

Benefits surveys. Benefits surveys are conducted to obtain data on employee benefits that are offered by employers. The usual benefits survey seeks to uncover prevailing practices in the form of:

• the benefits programs offered
• descriptions of those programs
• their coverage
• required employee contributions

Tabulations consist of the number of responding organizations having each type of program and, if possible, variations in programs by employee group.

For example, ERI Economic Research Institute conducts an annual Benefits Benchmarking Survey that is released in April each year.

Benefits versus salary surveys. Benefits survey information differs significantly from salary survey information. Salary surveys record compensation costs. Benefits surveys record costs and practices. The costs of benefits to employers may be very different, as each organization has a unique workforce and uses its own methods to finance employee benefits.

Cost of Benefits. Ideally, an organization would like to know both the benefits offered by competitors and the competitors' costs for those benefits, but the cost figures are hard to assess. It's difficult to cost out individual benefits, and competitors' accounting practices may vary considerably. Some organizations see an item as a benefit, while others do not. In addition, cost information on individual benefits may not be useful, since the composition of the workforce in each organization is different. It's probably more important to compare the total benefit costs between your organization and other organizations.