Topic: Most Common Employee Benefits USA 2023
Most Common Employee Benefits USA 2023
It can be difficult to create a compelling and competitive employee benefits package, especially for small businesses. Employers are required to offer certain benefits. These include social security taxes, unemployment insurance and worker’s comp. Other benefits will vary based on the size of the company. Not the least is medical insurance as per the ACA’s employer mandate.
Although employee benefits can be expensive, you should only offer what you can afford. It is important to be competitive in the market, not to be an outlier. Remember that cost-sharing is a common practice these days, and employees are expected to contribute a portion of the insurance costs.
To sweeten the deal, you have a lot of low-cost (or even free) benefits options. Where do you start? Here are some examples of benefits packages that American businesses offer.
A list of Most Common Employee Benefits USA 2023
- Health Insurance Benefits
This is an easy one. This is a no-brainer. Applicants consider medical coverage to be one of the most essential elements in an employee benefits package. As such, the majority of employers offer it. According to the Bureau of Labor Statistics, 70% of civil companies and 67% of private businesses offered medical coverage to employees in their employee benefits packages in March 2016.
You can ask your finance department and your medical carrier for guidance. They may require a certain amount of subsidization from employers (typically at least half of the premium cost). Remember that if your employer has more than 49 FTEs, the maximum premium an employee can be charged is determined by the ACA’s “affordability” provision.
Your broker can help you if this seems complicated. Your broker can help you compare your health coverage to other companies, as well as those in the same area that are competing for the same talent pool. It is important to find a company benefits plan that will help you stay competitive in the market while complying with all new regulations. Read more about Most Common Employee Benefits USA 2023
- Life Insurance
Although life insurance is more common than health insurance, it’s not as widespread as life insurance. According to the BLS, such policies were offered by 59 per cent of civil companies and 55 per cent by private businesses in March 2016.
Many employers offer life insurance up to the amount of an employee’s monthly salary free of charge. If the price tag seems too high for you, an employer may offer to pay a portion of the policy and ask that the employee contribute the remainder if they wish to.
- Dental Insurance
Although dental insurance is not as popular as health insurance, it is a common benefit for employees. Dental insurance is much cheaper than medical for you and your employees.
A common ratio refers to an 80/20 split between employer and employee. However, you can adjust it to make your business more successful.
- Retirement accounts
Most employers offer 401(k), 403(b) and 403(b) retirement accounts.
There are many options for logistics. Employers may choose to match employee contributions to retirement accounts. This encourages people who are reluctant to save. An employer will match 50% of the employee’s contributions up to 6 per cent of the employee’s salary in a matching arrangement. The company’s match is limited to 3% of an employee’s salary in this situation.
Others will match 100% up to a limit. Others, even if they are not eligible for Safe Harbor will make a contribution to a retirement plan.
Some for-profit businesses choose to contribute only to retirement via profit sharing. Employees who are enrolled in the profit-sharing program receive a letter at the end of each quarter or perhaps every six months indicating the amount they have contributed to their account. This could be more valuable than a matching or smaller program depending on how much the employee shares. However, it is up to you to decide how these programs are structured.
- Flexible Spending Accounts, (FSAs), or Health Savings Accounts, (HSAs).
Flexible spending accounts (FSAs), which are similar to HSAs in their permitted use, have pros and cons. FSAs can be used with almost any type of health insurance plan. However, they have a “use it or lose it” clause. If you claim $1500 per calendar year but only use $1300, then you will lose $200.
HSAs on the other side, however, are never subject to expiration. HSAs are more like savings accounts in that the money accumulates over time. You can also use it for as long as you want, even after you change your health plan. You can only make contributions while you are enrolled in an HDHP.
- Paid Vacations and Sick Time
It is almost impossible for companies to offer employees at least some PTO. Full-time employees are entitled to two weeks of PTO (10 days). Some companies also allow employees to accumulate additional PTO after they have been with the company for a significant amount of time (ex., an additional week after five years).
Some companies prefer to consolidate their PTO in one pile. Others keep it separate into personal, vacation, sick and personal. Both ways to structure these benefits have their pros and cons. You’ll need to decide which one makes sense for your business. So this concludes our topic for Most Common Employee Benefits USA 2023.