How to calculate a return on employee benefits How much does it cost to provide employee benefits and how do you calculate a return on employee
How to calculate a return on employee benefits
How much does it cost to provide employee benefits and how do you calculate a return on employee benefits when you’re busy? Do employee benefits ‘work’? And how do you know whether to keep doing what you’re doing?
“With total pay falling in real terms, employers and employees up and down the country are feeling the squeeze. Employee benefits are no longer just an HR focus, they’re a business imperative.” – Mark Scanlon, Chief Executive Officer of Personal Group
If you’re a small business, it’s critical to include the costs of benefits in addition to the base pay rate for accurate costing. Employee benefits – sometimes called fringe benefits – such as medical, dental and vision insurance, premiums, training and tuition reimbursement, life insurance contributions and other company-paid perks all add up.
Methods of calculating the ROI of employee benefits
Rather than ask, what is the “return on equity” from a particular benefit, shouldn’t the question be, what is the “return on employee”? It’s not a return on an investment; it’s a return on an individual
A great reminder for us all. But when it comes to actual figures to calculate a return on employee benefits- you might want to turn to Personal Group, a leading employee benefits provider which recently launched a brand new, one of a kind employee services ROI calculator on its website which calculates how much money a company and its employees can save by implementing a best-in-kind employee services programme. Personal Group are indeed vested in employee benefits working – their own research shows that an employee benefits platform could save a company with 1000 employees more than £125,000 per year – but when the figures are there in the cold light of day (accounted for using retention rate, absence rate and employee volume) you get a clear figure of Total Annual Savings you could be making,
This is a great bit of kit for business leaders and shows businesses how much their individual employees can save, as well as the impact that implementing an employee benefits programme will have on recruitment, retention, absenteeism and productivity. Together, this will allow management to make an informed decision which is best for both the business and staff. Try it out today: www.personalgroup.com/roi-calculator
4. Internal savings
As well as proving the effects on employees, when you need to calculate a return on employee benefits why not try and show benefits internally? You might have reduced admin load. Perhaps you have more insight using the platform on spending habits. Maybe your learnings on email marketing internally have influenced your external marketing team. Controlling costs, reducing risks or making improvements on your previous benefits packages are all valuable and worthwhile goals.
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