Should You Include Contract Workers in Your Employee Benefit Programs
It’s truer than ever: employers who show they care, in terms of health benefits, can get a leg over rivals by creating not only a healthier, and therefore productive, workforce, but a more loyal one. This goes straight to recruitment and retention – a dominant focus in this new business environment. But what if you have a fair number of contract workers in your employ. Should you include contract workers in your employee benefits programs? The answer is yes, and here’s what you should know.
In today’s business, social, and economic environment, people are working more “gigs” than ever. Whether they’re cobbling together money to pay bills or diversifying their employment to include activities that make them happy, gig employment is on the rise. Economic ravages spawned by the pandemic have accelerated such unconventional employment.
All this is a bit of an issue for organizations, which must figure out where the gig economy ends, and their traditional employment relationship begins. It’s an issue largely because COVID-19 has resulted in a very tight labor market in which employees have more say in terms of where and how they wish to work.
So, against that backdrop, organizations are finding themselves in need of new and emerging skills. And increasingly, they’re hiring independent contractors to fill those gaps. Those workers need healthcare, too. The trouble is that 65 percent of contract workers are toiling without health benefits.
Benefits for Contract Workers
You can’t have it both ways: if you’re going to increasingly hire more contract workers, then you’re going to have to provide some benefits or risk losing them to competitors who are. The good news is that, if you do offer employee benefit programs, workers on the receiving end will be likely to stick with you. What’s more, through all-important word of mouth, you’ll be able to attract more workers, too.
Here’s what you should offer:
- Health insurance. If you’re hoping to cut organizational costs by hiring more contract workers, don’t make the mistake of going all the way and not offering health coverage. These days, that’s a bridge too far. You also want to include family coverage as part of your plans.
- Dental insurance. You can offer a voluntary, quality, low-cost plan wherein all restorative and preventative procedures are covered. In the name of recruitment and retention, go one step further and offer a plan that covers contract workers’ dependents as well.
- Vision insurance. Contract workers increasingly expect such coverage. You can put together a plan that will save your workers cash on eye exams, eyeglass frames and lenses, contacts, and even laser vision correction.
- Retirement savings. Your contractors will love you for offering a 401(k) benefits plan that will help them save for retirement. Did you know, according to FoxHire, that 64 percent of U.S. residents will call it quits with little to no cash put away? Look at this as an opportunity.
- Health savings account. This is especially important for workers who want some protection against sickness or injury. An HSA, as it’s commonly known, can provide your contractors with tax-free savings to cover health insurance premiums for unexpected medical bills.
So, should you include contract workers in your employee benefits programs? The answer is yes – within some limits. After all, managing the costs and administration of these programs can be unwieldy and time-consuming. That’s where a self-compliant innovations platform such as Mercer Indigo can come in. Mercer specializes in gig and part-time workers, independent contractors, and freelancers that are increasingly comprising today’s workforce.