The Perks.

• Author: McKIMMIE, KATHY
• Position: Employee benefits

How attractive are your employee benefits?

Savvy businesses are rethinking their benefit packages to attract and retain the best workers.

Flexibility in scheduling, more time off, choice in health and retirement plans, and family-friendly policies take up where pay leaves off. According to the latest Employee Benefit Survey by the U.S. Chamber of Commerce, benefits comprise 37.2 percent of gross payroll.

For some employees, the lure of flexibility and time off mean even more than pay. "There's been a change from earlier years," says Pat Walter, assistant vice president human resources for Atlas Van Lines in Evansville. "Employees almost looked forward to overtime to get the extra pay." But she says Atlas more recently lost some workers when they had to work mandatory overtime.

"We're dealing with several different labor markets," says Dr. Herschel Chait, director of the MBA program at Indiana State University. "What you need to attract and hold a 55-year-old worker is different than for a 25-year-old worker. It's always been true, but employers need to respond more now, in this tight labor market." Chait cites conflicting studies on what's important to younger workers. Some say pensions are unimportant and "training is what they really want," says Chait. "Others refute it."

So, what's likely to keep your employees from job-hopping? Maybe it's a high Workforce Commitment Index (WCI), as measured by Aon Consulting, Chicago, in its annual America@Work survey. It reports that "the most significant driver of this commitment is management's recognition of an employee's personal and family life." WCI measures teamwork behaviors, willingness to recommend their employer and its product/services, and intentions to keep working for the employer.

CAFETERIA PLANS FOR SMALL BUSINESS

Pre-tax cafeteria plans for medical and dependent care reimbursement have been popular perks for years in larger workplaces. Now, thanks to software availability, small companies can offer the same benefits, says Scott Jargo at The Nyhart Company in Indianapolis. The medical benefit portion can be used to pay co-pays and deductibles. That's becoming increasingly important as health care insurance premiums continue to rise and employers pass on more costs to employees.

"The new mental health parity had a big impact on rates," says Walter.

Although it was only one factor, Atlas was hit with an 18 percent increase in rates in March. The company's increase would have reached 25...