Estimated reading time: 3 minutes
It is important to benchmark your employee benefit solutions to fully understand where you stand in terms of offering competitive benefits compared to other employers in Wisconsin that are recruiting and attracting talent from the same pool that your organization is drawing from. Are you paying too much? Are you offering the right incentives to attract and retain employees? Without thoroughly and regularly taking inventory of your offerings, it is impossible to know if you are staying competitive and offering the right employee benefits.
What does it mean to benchmark employee benefits?
Basically, benchmarking is the comparison of the employee benefits your organization offers to those of similar employers (in industry, region and size). You can, and should, compare almost all features of your benefits offerings, including employee contributions, out-of-pocket cost per employee, deductibles, co-pays and included benefits.
After you have collected these details, evaluate how your organization compares to your peers. You may have implemented a specific strategy regarding benefit levels, so while you are benchmarking in comparison to other organization, consider whether you are meeting your strategy as well.
What to analyze
Typically, attention is particularly paid to medical cost, coverage and plan design. Because medical insurance is the largest cost component of a group benefits package, it is important to fully analyze how money is being spent to offer the best employee benefits possible to attract and retain top talent.
However, it is essential to consider all ancillary offerings as well, including dental insurance, life insurance, disability insurance, pension plans and wellness programs.
How to gather the right information
Benchmarking reports are released annually by various insurance carriers, associations and brokers. There reports compile statistics in a number of categories to easily understand plan design and features that are being offered. These reports, with a copy of your plan summary, most recent bill and schedule of employee contributions will provide you with the information you need to determine how your organization compares.
While it is possible to complete this analysis in-house, your human resources department is busy enough. Your employee benefit solutions partner will gather the reports necessary and analyze your plan relative to the benchmarks for your industry, area and company size. They will then make recommendations for plan, contribution or benefit changes that will make your company more competitive.