What Are Voluntary Benefits and Should You Offer Them?

Have you ever wondered if your company is offering its employees enough benefits? While you’re most likely familiar with the mandatory benefits that employers must offer employees, have you heard how beneficial voluntary benefits are for taking care of your employees without a significant cost burden?

Offering employees a benefit package can be beneficial for both the employees and employers. Several reasons contribute to this, including employee satisfaction and loyalty, retaining employees, and improving overall health and wellbeing. 

In this article, we’re going to discuss what voluntary benefits are, the different types of voluntary benefits, and the benefits of offering voluntary benefits to employees. 

What are Voluntary Benefits? 

Voluntary benefits are plans that a company offers their employees. There are many different types of voluntary benefits, which we’ll discuss, but typically the main benefit plans include insurance and retirement benefits. These are benefits that an employee is able to get at a discount by voluntarily signing up for them and having the cost of them deducted directly from their paycheck.

Voluntary employee benefits differ from mandatory benefits, as mandatory benefits are required by law for employers to provide their employees with, whereas voluntary benefits are optional. Another key difference is that mandatory benefits are paid for by the employer, while voluntary benefits are paid for by the employee.

Types of Voluntary Benefits

There are different types of voluntary benefits employers can offer. These typically include health-related, financial, or lifestyle benefits. Employees will have the option to enroll in any of these benefits and opt out as they desire. Let’s dive into each of these and the benefits of offering them to your employees!

Health-Related Voluntary Benefits

Health-related voluntary employee benefits cover a variety of areas. Employers can add these benefit offerings to any of their standard coverage. 

Some key health and wellness voluntary benefits include:

• Supplemental Health Insurance: This is additional insurance that helps pay for health care costs that are not covered by a regular health insurance plan. For example, this may include critical illness insurance, accident insurance, emergency hospital transportation insurance, and telehealth access.

• Dental Insurance: This typically pays for and covers dental expenses, such as routine cleanings and dental procedures.

• Vision Insurance: This insurance usually covers routine eye exams and some out-of-pocket eyewear costs.

Financial and Lifestyle Voluntary Benefits

Financial and lifestyle voluntary benefits are those that contribute to the security and lifestyle of an employee. Instead of merely providing health benefits, these help with the overall well-being of an employee.

Some of these benefits may include:

• Retirement Savings: Employees may choose to contribute to a retirement plan, such as a 401(k), traditional IRA, or Roth IRA plan, from their paychecks as part of their retirement savings plans. In some cases, employers may match a percentage of the employee’s contributions.

• Financial Services: These services may include financial planning, tax help, or investment guidance from professionals. This can help the employee feel more in control of their current and future finances.

• Life and Disability Insurance: This is a great benefit for employees, as it provides them with the security and peace of mind that themselves or their family will be taken care of in the event something were to happen to them. In addition, this is a typically portable benefit, meaning most voluntary life insurance policies retain consistent coverage even if the employee leaves the job.

• Gym Membership: Employers do not have to offer this; however, you offer this as an option for their employees to add it on to their monthly health and wellness benefit package.

Reasons To Offer Employee Voluntary Benefits

Employee retention and satisfaction is something that everyone business owners want to ensure—and offering voluntary employee benefits can help in both of those areas. And beyond that, there are many additional benefits of offering voluntary benefits that help your company and your workforce.

Improve Employees’ Health

As an employer, you want a healthy workforce. Offering voluntary employee benefits that help support the physical and overall well-being of your employees can help keep your workers both healthy and happy. And oftentimes, a happy, healthy workforce increases job satisfaction and productivity. Additionally, boosting employees' health and wellness also helps reduce employees' time needed off work.

Help Promote Company Loyalty 

When you offer employees not just voluntary health benefits, but lifestyle and financial planning benefits also, this shows your employees that you value and care about them and their well-being. In turn, this helps increase employee satisfaction and can even boost employee loyalty. When employees know they are taken care of, this takes a huge load off of them, resulting in less stress. And less stress can often mean happier employees and promote better job performance!

Employee Attraction and Retention

Which leads us to another important aspect, and something that is always on a company’s mind—attracting and retaining employees. Turnover not only causes companies a lot of frustration but also costs a lot of money and time. By offering an attractive voluntary employee benefit package, this can help attract top-tier workers, as well as produce a sense of loyalty and satisfaction within the workplace.

Cost-Effective Benefits Enhancement

Providing a voluntary benefit package is a great way to take care of your workers by offering them additional perks without it costing you a fortune. Since voluntary benefits are through your company, these benefit packages are typically available to the employees at a significantly lower cost than it would be if they would have to obtain them individually. 

This helps save your employee money and also may provide benefits that help cover expenses they wouldn’t even be able to get with other types of insurance. And since the costs of voluntary benefits come out of the employee’s paycheck, this is a great way to help take care of your employees without significantly increasing your benefit budget!

Summary of Voluntary Benefits

Essentially, employee voluntary benefits are optional plans that employers can offer their employees. Unlike mandatory benefits, which are required by law and funded by the employer, voluntary benefits are paid for by the employees themselves. Employees can enroll in these benefits at discounted rates, with costs deducted directly from their paychecks. These benefits can include health-related options like supplemental health, dental, vision insurance, and financial and lifestyle perks such as retirement savings plans, financial services, life insurance, and even gym memberships.

There are many benefits of offering voluntary benefits, including enhanced employee satisfaction, attaining and retaining talent, and boosting employee loyalty and productivity—all while also being cost-effective for employers. Overall, voluntary employee benefits are extremely beneficial to both employees and employers.

If you’re uncertain about how to enhance your employee benefits package with tailored employee voluntary benefits, don’t worry; Complete Payroll is here to help. Visit Complete Payroll to learn how we can help you implement and manage these options effectively!