Student debt repayment programs, unlimited PTO help employees live balanced, productive lives
Millennials now make up more than a third of the workforce. And, while other generations share their desire for work/life balance, this group is demanding it – especially in today’s tight labor market. What can you do to stand out? Here are some ideas from The Miller Group’s own research and experience.
Unlimited Paid Time Off
Our sales team has had this perk for a while, and we’re extending it to most employees in 2019. It sounds crazy, doesn’t it? But we’ve seen it work, and our staff is excited about unlimited PTO. It’s basically a performance-based system: Get your work done well, and we don’t need to count your days off or differentiate among sick, vacation and other days.
A couple of caveats: The foundation for this kind of program is a solid performance management system that allows you to evaluate each employee’s contributions aside from hours worked. According to MammothHR CEO Nathan Christensen in Fast Company, “… unlimited vacation policies convey trust, making employees – not their managers or HR directors – responsible for making sure their tasks and projects still get done regardless of the time they take away from the office.”
Studies show that employees tend to skimp on time off when first introduced to unlimited PTO and the first year tends to make or break the success of the program. So we’ll be monitoring our results closely, encouraging our associates to take breaks and recharge. We’ll also make it easy for them to completely turn off when they’re out, so they can come back truly refreshed. We have seen a lot of excitement about this among potential new hires. And it’s especially popular with working moms. (We also started offering paid parental leave of up to 12 weeks last year!)
100% retirement plan match
We recently increased our retirement plan match to a 100% match of employee contributions up to 5% of their pay. Your match is a lever you can adjust periodically, depending on budgets and business results. And, it rewards employees in proportion to their own actions: They invest their own cash, and the employer contribution changes in proportion.
Student debt repayment
This seems to be the hottest employee benefit idea right now. Like other companies, we’re watching for clearer IRS guidance around the idea of employers making qualified contributions to retirement plans to correspond with student debt repayment. It’s a great way to help employees save for retirement while they’re paying down their college loans.
Even without approval for tax-qualified contributions, about 4% of U.S. companies are offering a straight, taxable student loan repayment benefit. Most are contingent on the employee’s own repayment percentage, and they typically have an annual dollar limit. Several vendors offer student debt repayment systems for employers wanting to help their employees with their student loan burden.
If you’re thinking about offering such a program, here’s what to keep in mind:
- Repayment amount: You can start with a small amount – say $50 a month – and leave room for increases, depending on participation and budget factors. Most of the companies we looked at repay $50 to $100 a month, with a lifetime cap.
- Reciprocity: Most companies make their contributions contingent on the employees repaying a minimum percentage of the debt themselves during the benefit period. Some companies also require employee payments to be made electronically. (This can save up to .25%.) But here’s where the recordkeeping becomes complicated; you might look for a service partner to administer the plan.
- Design: Simpler designs and uncomplicated eligibility requirements seem to work best.
Financial wellness programs
Education: Employees who are burdened by their own financial woes – and those of their children and parents – have a hard time focusing on work. So, The Miller Group reimburses our employees, their parents and their children for the cost of completing Dave Ramsey’s Financial Peace University. Once the course is completed, the company matches up to $500 in employee contributions to the $1,000 emergency fund recommended by the program.
Hardship Support: The Miller Group has a Benevolence Fund that provides a financial cushion for associates in dire circumstances. Employees have the opportunity to designate a portion of their salary to this fund every year, and The Miller Group matches it. If and when an employee needs financial help, they can apply for funds through a highly confidential process. Over the years, we have helped dozens of people and dispersed thousands of dollars. It’s one way we demonstrate that “we care.”
Support for employee giving and volunteerism
Caring for the community is a core value for The Miller Group, and we’ve contributed to our community – and supported employee giving – for decades. This happens to be consistent with what millennials are looking for, too. According to a recent FORTUNE article on the subject, “Surveys show that millennials care about their companies’ social responsibility programs and want to play a part in effecting positive social change.”
We have multiple benefits that engage employees in giving and support their own charitable acts:
- We match 100% of charitable gifts to any of our nonprofit clients (more than 100 to choose from), with no maximum.
- We organize group volunteer activities, such as Christmas in October to fix up a community member’s home; Lead to Read (a weekly volunteer opportunity in a local school); and community blood drives.
- We pay up to $50 per month in registration fees for employees (and their family members) who participate in a charitable walk or run.
- We pay employees up to $50 toward the purchase of Fitbit (or other tracking device) and pay $25 per month toward the cost of gym membership if they attend regularly.
- We organize firm-wide volunteer days and grant employees one day off a year to volunteer for an organization of their choice.
Attracting and retaining the right employees remains at the heart of human resource responsibilities. As benefits consultants, we’re continually on the lookout for ways to support our HR colleagues. Got any ideas to share? We’d love to hear about innovative strategies others are exploring in this tight labor market. Comments welcomed!