Overlooked employer benefits: Ignorance can cost you money
When looking at a potential new job, many people are focused solely on monetary compensation — base salary or hourly rate, bonuses, and commission. When I was a recruiter, only a few candidates wanted to discuss health insurance options with me. Almost no one would ask about other benefits that can make a big difference in one’s life financially, health-wise and for general work enjoyment. That is a shame, as I have seen personally how having access to some of these benefits can make a huge difference in someone’s life. When you are thinking about a potential job opportunity, learn about the total compensation and benefits package. You may find that you would gladly offset a lower starting salary for access to many of these benefits.
Retirement Plans
A few savvy candidates would ask about the company’s retirement plan. Given that in the United States the majority of adults haven’t saved enough for retirement, having access to a retirement savings plan, either a defined benefits plan (pension) or a defined contribution plan (401 (k), 403 (b) or 457 plan) is very important. The number of employers offering traditional pension plans (generally a monthly payment for life after a set time period that is based on tenure and salary history) has been dwindling and is estimated to be only 14% in the US. Pension plans can be very enticing to potential employees and are often a selling point for joining an employer or government entity. Much more common is a defined contribution plan where an employee puts in pre-tax money (and increasingly the opportunity to put in post-tax money) that may be matched by an employer. While the potential to put money aside, taken directly from your paycheck, into an account that allows the growth of that money while either deferring taxes or in the case of a Roth 401 (k), no further taxation, is a good benefit in of itself. Even better is when the employer also adds money into your account in the form of a match or even something called a safe harbor contribution. We in HR often call this “free money” and should be considered part of your compensation. Savvy job seekers will ask about the retirement plans offered, any company contribution as well as any vesting requirement to get access to any company contributions. Just this benefit alone can add thousands of dollars to your yearly compensation.
Disability Insurance
Employees rarely think about this benefit until it is needed, but it is huge. In my years in HR, I have seen many people go out on disability. Think about the broken shoulder from a touch football game. Think about the car accident that injures your back. Think about the unexpected cancer diagnosis. Think about the heart attack. One time, instead of something unfortunate happening to someone else, it happens to you. What would you do if you could not work and had no income coming in? There are generally two types of disability insurance that can cover you — short or long term disability. Short term disability is for non-job related injuries or illnesses. It also includes maternity, though an employer could cover that through a separate plan). Short term disability insurance provides income replacement for a set period of time (often six months) while you are unable to work. This can be a lifesaver, especially if you are living paycheck to paycheck. Generally, there will be some sort of waiting period before you qualify, and the income replacement could be all or a portion of your paycheck. Some states have laws mandating employers to cover employees for short-term disability, but it is a small number.
Long-term disability offers income replacement for those that have been disabled for a set period of time. These benefits may continue through normal retirement age or when the employee is eligible for Social Security Disability benefits. Often eligibility for long-term disability happens when an employee has exhausted their short-term disability. Again, I have seen employees that have been diagnosed with debilitating diseases that have ended up on long-term disability, and I am so glad that it was an option. While the majority of employers do offer both short and long-term disability, always ask about this benefit and know the waiting periods for eligibility and the percentage of income replaced (including what type of income). Not all short or long-term disability plans are the same, so the details here are important.
Wellness
In order to promote healthy lifestyles for their employees (and to reduce insurance claims and health care costs), many employers offer many benefits under the category of wellness. These benefits can include free or reduced-cost gym memberships (or even an onsite gym), weight loss programs, smoking cessation programs, health screening, and even flu shots. A free gym membership can be worth over $1,000 in some areas of the country. Standing desks, walking or running clubs and free healthy snacks are just a few other benefits that can enhance your health and your general well-being.
Education Benefits
Are you thinking about starting or completing a college degree? Perhaps you are looking for a certification relevant to your field and industry. An employer may be willing to pay for it. According to the Society for Human Resources Management (SHRM) 2018 Employee Benefits Survey, 51% of employers provide undergraduate educational assistance, 49% provide graduate educational assistance and 77% will pay for certification/recertification fees. Getting a college degree can be a very expensive undertaking. Why not find an employer that will pay all or a partial amount of the tuition? Additionally, some employers provide scholarships for family members going to college or may even provide assistance with loan repayment.
Another overlooked benefit is the payment of fees to join professional organizations or registration and travel to go to industry conferences. This is a huge but often overlooked benefit. Being a part of a professional organization or attending conferences can help you keep up-to-date on industry trends and changes and further your career. If a company will not negotiate on base salary, see if it offers this benefit. If it doesn’t, think about adding it as a possible area of negotiation.
Employee Assistance Program (EAP)
An Employee Assistance Program is a truly overlooked benefit by employees even in companies where it is offered The EAP is voluntary and confidential, so the employer does not know about your specific issue. Most EAP programs have professional counselors that can assist employees experiencing personal issues that may also be impacting their work. Many EAPs have programs in the areas of alcohol and drug abuse, childcare and eldercare, marital or relationship issues, financial difficulties, and emotional or mental health issues. Many EAPs will allow a spouse or children to also participate. Many EAPs do limit the number of counseling sessions an employee may have, but it is a great resource to speak with a professional about your particular issue.
Transit Subsidy
Commuting to work can be very expensive. Less than 15% of all employers offer transit subsidies, so if you use the subway or bus, be willing to vanpool or bike to work, this could be a benefit you would use. This can either be structured as an entirely employer-funded benefit or employees can contribute on a pre-tax basis, which reduces income that is subject to taxes at the federal level and sometimes at the state as well. This benefit can include mass transit passes, vanpooling, and qualified parking. Bicycling reimbursement may also be included as a qualified transportation fringe benefit.
Matching Charitable Contributions
For those that make monetary contributions to a non-profit, the ability to have the company provide a portion or a full match to your own giving is a great perk. Companies can structure their giving programs in many ways and can match a percentage, do a dollar for dollar match or even double the employee contribution. Additionally, many employers will also allow employees paid time off to volunteer with qualified organizations.
Company Discounts
Depending on the company’s business, it may offer discounts for the purchase of its own products. Retailers, restaurants, hospitality and airline companies are known to provide employee discounts to their employees. Other businesses may participate in a cooperative discount program, so the employees in all of the businesses of this group can take advantage of the discounts offered within the cooperating companies. This is advantageous if your company sells a product or service that would not be purchased very often. In addition, many companies partner with third parties vendors that provide discounts to restaurants, movie theaters, and theme parks, to name a few. If you are going on a family vacation or always purchase products from a participating retailer, this could provide substantial savings.
Each year there are exciting new benefits that companies are adding to their offerings. While these benefits will not appeal to all would-be employees, they can be quite exciting to some. In the past five years, the same SHRM study noted new benefits such as employer-sponsored contributions or match to a 529 college saving plan, breast milk shipping while on business travel and paid surrogacy leave. Don’t rely on the employer to verbally tell you about all their benefits. Look for information on their web site or go to Glassdoor.com to find out what is offered. Ask to be given a written summary of all the benefits, if available. You can also ask to speak to someone in the benefits department to better understand the programs offered. Having knowledge of the full compensation and benefits offered, how it compares to other employers and the value it brings to you, can make you more confident in your decision to either accept or reject an offer.