How to Reward Employees – Raise in Pay or Benefits

How to reward employees – raise in pay or benefits? At least one business owner every night is tossing and turning with this question bouncing off the walls of his mind. Inevitably, this chain of thoughts will be focused on cost. Are the advantages of either a pay raise or an employment benefit greater than the cost? Either reward should increase the employees’ productivity. But will this increased productivity cover the cost of the reward?

Business owners need to focus on the long-term advantages. Instead of contemplating whether the pay raise will boost immediate productivity, the real benefits are revealed with the employee happiness such rewards deliver, and the loyalty that results.

When employees are happy and loyal, fewer employees will quit. The sudden removal of an instrumental part of the team will be very costly to the company. According to Builtin, replacing an employee of equal experience can cost one a half to two times the employee’s salary.

As a result, preserving employee happiness and loyalty is essential to a productive workplace. However, it is the business owner’s responsibility to ensure the employees are happy.

Raise in pay

The advantages of a raise in pay are evident. Everyone wants a higher paycheck. But how much of that raise will find itself into the employee’s pocket? Taxes, for example, will take a chunk of that raise from both the employer and the employee. The employer will pay more for that raise in payroll taxes. The employee will lose some of that raise in income tax.

Providing one employee with a raise will boost that employee’s productivity. Unless the coworkers receive a similar raise, however, the raise could actually decrease motivation around the office. Of course, a raise for one employee could inspire coworkers to increase production. It could go either way. When dealing with employees’ productivity, however, such gambles could be too risky to take.

When rewarding an employee with a pay raise or even a bonus, sometimes employees may stop focusing on how to improve their work performance and instead focus on the monetary aspects of the raise.

Employment benefits

Countless studies show that many American workers prefer attractive benefits to a raise in pay. After all, if half of one’s paycheck is going to health insurance and roadside assistance, if such benefits are provided with one’s employment, the employee becomes happy and loyal, and their production increases.

• A Staples survey reveals more than half of employees said that they would take a lower salary in exchange for improved benefits.
• An American Institute of Certified Public Accountants survey declared that 80% would prefer a job with benefits over the identical job with a 30% increased salary, but with no benefits.
• A Glassdoor survey illustrated that handsome benefits were the number one driving factor to compel individuals to fill out certain job applications.

Benefits are greatly appreciated. They increase employee happiness, loyalty, and productivity. In addition, handsome benefits will attract a more stellar pool of applicants. Considering how desirable employment benefits are, the greater benefits offered will attract a greater pool of applicants.

Today, NSD has more than 15 million new customers and more than$500 million in annual sales.

Nation Safe Drivers

Nation Safe Drivers (NSD) has been strengthening warranties and employment packages for more than six decades. Not only does NSD carry a wide selection of employment benefits, ranging from roadside assistance and telehealth to GAP protection and RV technical assistance, but such products could be attained for a few dollars per employee.

The selection allows employers to pick and choose which benefit would best fit the individual employee. Tire and wheel and telehealth are two excellent benefits. However, giving tire and wheel to a senior citizen, or telehealth to a teenager, would not result in optimum productivity increases. Speak with an NSD sales representative today and watch profits soar tomorrow!

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Email: sales@nsdmc.com