Voluntary programs make great small business employee benefit packages for maternity. This is most true when these employers want to attract and retain a female workforce in the growing family life stage. Maternity related programs are just too expensive for employers to offer.
Voluntary employee benefits are a great option for any size employer: large, medium, and small businesses. They can provide a robust set of maternity entitlements to attract female employees, without adding to direct cost.
- Paid maternity leave options with supplemental insurance
- Benefit administration assistance
- Payroll tax savings through flexible spending
Small Business Employee Benefit Packages
One of the most common statements made by site visitors relates to employer size. We often hear “my employer is a small business and can’t afford to offer a good employee benefits package.” The reality differs.
Small businesses with as few as three benefit eligible employees qualify to offer voluntary employee programs. The definition of “benefits eligible employee” has plenty of wiggle room. It does not necessarily mean that the small business employer is contributing towards small business health insurance premiums. It means any paid worker for whom the business is willing to withhold a payroll deduction.
Small Business Paid Maternity Leave
Voluntary employee programs allow for small business employee benefit packages that include paid maternity leave options. You hear in the media that the United States does not have paid maternity leave laws. Small businesses can easily afford to hire and retain female employees of childbearing age, while promising this entitlement.
Small businesses can offer two supplemental health insurance options as part of their employee benefits package. Short-term disability and hospital indemnity insurance both make payments directly to employees for normal childbirth. Employees pay the premium themselves, so there is no direct cost to small business owners. The only cost is the administration of a payroll deduction.
Small Business Benefits Administration
Small business employee benefits packages face the same administration challenges as larger businesses. There are legal compliance issues, and need for consistent documentation. Small businesses face these same challenges but often cannot afford the sophisticated employee benefits administration software purchase, installation, and maintenance costs.
By offering voluntary employee programs, small businesses gain access to advanced enrollment systems. Carriers provide access to these systems as a value added service. Access to these systems works best when small business employers conduct a mandatory enrollment. Each employee logs into the system and verifies they were given a chance to participate.
Small Business Tax Savings Benefits
Flexible spending accounts make for an affordable small business employee benefits package offering. Many small business employees with growing families find a variety of eligible expenses. The service fees charged by third party administrators can often by overcome by payroll tax savings.
Many small businesses may have employees with children in day care. Each employee with a child in day care may reduce the amount of payroll taxes paid by the business. The employee may contribute up to $5,000 annually. At a 7.65% rate, both the employee and the small business reduce their FICA obligation by $380 each year.
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