Learned from this week’s materials discretionary benefits are benefits that are not required by the law and are used to build a competitive edge when it comes to attracting employees and retaining (UCB, 2017). To add, discretionary benefits are a large cost for companies, and some are needed to be cut for the better of the company budget and have varying level of importance to employees.
When thinking discretionary benefits my ranking of benefits I would most likely eliminate to the ones least likely eliminate can be seen below.
- Tuition Reimbursement
- Outplacement Counseling
- Employee Assistance Programs
- Transportation Services
- Paid Time Off
- Disability & Life Insurance
- Retirement
- Family Assistance
Based on my ranking one benefit that I believe that could be cut is tuition reimbursement to cut costs. My rational for cutting this program is that it is very costly and can add up if there are many employees seeking higher education. As the costs of education is on the rise, it will lead more and more incurred costs to the company in the long run. Too add, I do think there is risk in investing in this as the employee is not guaranteed to stay with the company after completing their education.
As well, outplacement counseling can be reduced. As this benefit can be valuable to the company as it can help save reputation for those that are being let go. However, the costs and time do not outweigh the benefits to help those who are leaving the company. My decision to cut these benefits come smore from a financial standpoint and can be subjective.
In comparison, I ranked retirement programs and family assistance programs the highest. My rational for this is they bring more value to the company and the employee. As family assistance as this can relate to providing elder care and childcare (Martocchio, 2017). With this, in place it allows for employees to be able to better balance and have support to manage their work and home life. Along with retirement plans can help support employees later in their life and can be incentives to continue working to work with a company knowing their return in investment is worthwhile.
One factor that can influence benefits an organization offers is the costs associated. As discretionary benefits are costly to implement the financial means of a company has influences how much they are able to provide. This can depend on their budget, size of company, and financial stability which are all variables that can influence which benefits are implemented and which ones the company feels are most important.
Another factor can be company culture which can influence type of benefits are offered. Depending on the company’s values they wish to uphold it can influence which benefits they want to provide to their employees. An example, of this could be a company that has fostered a company culture that emphasizes family. They would be more likely to support family assistance programs and PTO rather than tuition reimbursement.
In sum, these factors influence an organizations benefits packages based on their financial capacities to implement and which ones to prioritize. Along with, the benefits they choose to offer can influence employee retention and recruitment when it comes to a company. In combination, the benefits offered can affect and employees behavior in which they perceive the company they work for and how employees are valued which can influence their motivation and willingness to contribute to the organization.
References
Jones, K. (2017, February 15). The Most Desirable Employee Benefits. Ebscohost.Com. https://web.p.ebscohost.com/ehost/pdfviewer/pdfviewer?vid=1&sid=c44871cf-5aae-44d4-994f-88f7b6d12c10%40redis
Martocchio, J. (2019). Pearson etext for strategic compensation: A human resource management approach — access card (10th ed.). Pearson.
UBC. (2021, January 27). Discretionary benefits – what are they and should you consider them? UBC Insurance Solutions. https://www.ubcinsurance.com/what-are-discretionary-benefits-and-should-you-consider-them/
