With the economy continuing to be in a precarious position, and unemployment figures equally pessimistic, many companies are looking for ways to cut costs in order to shelter themselves from these difficult economic impacts. And in many cases, the low-hanging fruit appears to revolve around employee benefits. It can be far easier to slash bonuses and raises, for example, than it is to take a cold hard look at expenditures and determine where money can be saved. Yet is this really the best first option for companies, this knee-jerk action by Human Resources to take away employee benefits?
At first glance, perhaps so. Again, this is a quick and easy way to cut costs, and most companies these days recognize that with the depressed job market, most employees are happy to have jobs at all and are unlikely to make waves when told that their benefits are being cut. Yet the question becomes, is this the type of atmosphere that any company wants to cultivate, one where employees are bitter and not necessarily giving their all, but simply showing up to work and doing the minimum expected in order to keep their jobs?
Companies looking for cost-cutting measures should first do the heavy lifting themselves. This means that the heads of each department, from HR on up, should submit detailed plans to the CEO detailing how and where costs can be cut. All executives are flying first class, and attending retreats in exotic locales? These should no longer be a priority. While some of these cuts may seem like symbolic measures, symbolism goes a long way in making employees feel as if everyone is in the same boat together, working to make sure the company stays prosperous and healthy – as opposed to a situation where lower-level employees feel that they are the only ones being asked (or told) to make sacrifices, in which case resentment will be brewing.
Then, how about incentivizing employees in various ways? This can involve bonuses, even gift cards, for employees who come up with ways to save the company money, or for those who are able to bring in new business leads. Implementing a Section 125 Premium Only Plan is also a great way to save and still offer employees valuable benefits. Again, these are ways to make employees feel invested in the success if the company, and to feel that they have a stake in making sure the company does well.
What if employee benefits in the end do have to be cut? Sometimes this is inevitable, but in these cases, management should make sure that employees are recognized in some other way or give some other types of benefits, such as the ability to telecommute, or having lunch brought in for the staff. In addition, an acknowledgement that employees are in fact being asked to make a sacrifice will go a long way in helping employees feel that management at least somewhat understands their pain.
By utilizing these tactics, companies are more assured of one thing: that once the economy does improve, employees will feel a sense of loyalty to the company and won’t be jumping ship at the first opportunity, as they would have otherwise. How do you plan on containing health care costs?
