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CCH® BENEFITS — 11/21/07

Health Care Benefits, Paid Vacation, Retirement Savings Are Best For Attracting, Retaining Employees

From Spencer's Benefits Reports: Employers rate medical benefits and paid vacation as the top programs to attract and retain employees, according to a survey by WorldatWork. Also seen as “high impact” programs for recruiting and retaining employees are defined benefit plans, flex-time, and telecommuting. The survey, Attraction and Retention: The Impact and Prevalence of Work-Life & Benefit Programs, conducted electronically in September 2007, received responses from 649 WorldatWork members. Typical WorldatWork members are at least managers/assistant directors at their firms and have at least five years of experience in human resources or compensation.

Ninety-five percent of survey respondents rated medical plans as having moderate or high impact on attracting employees, and 88% said medical plans had a moderate or high impact for employee retention. All but 1% of the firms surveyed offered medical benefits.

Paid vacation was close behind, with 93% and 91% of respondents rating it as important for recruitment and retention, respectively. Paid vacation was offered by all respondent firms.

Flex-time was identified by 92% of respondents as having a moderate or high impact on employee retention, and by 84% on employee recruitment. Slightly more than four-fifths (82%) of the respondents’ companies offered flex-time.

Retirement Plans

Pension and retirement savings plans also were valued recruitment (89%) and retention (87%) tools, primarily with a defined contribution plan, offered by 97% of respondents’ firms. Defined benefit plans, which were offered by 56% of firms, were seen as more valuable to employee retention (90% of respondents) than to employee recruitment (78%).

Of the 62% of respondents that reported having a telecommuting program, nearly half (46%) valued it for employee retention; fewer (38%) valued the program for employee attraction.

Emergency back-up dependent care, worksite child care, and sabbaticals were offered by fewer than 30% of responding organizations. However, three-fourths of respondent thought that worksite child care was valuable for employee recruitment and retention. Almost all of the responding organizations (95%) offer IRC Sec. 125 flexible spending accounts for medical and dependent care expenses, although only about half of the respondents said these accounts had moderate or high recruitment and retention value.

According to WorldatWork, about half of the survey respondents offered wellness programs, such as health screenings, smoking cessation, and weight and stress management programs, but fewer than one-third of respondents reported that these accounts had moderate or high recruitment and retention value.

Approximately half (51.6%) of the survey respondents worked for public employers, one-fifth of respondents worked for nonprofit firms, and 28% worked for private firms. The great majority (87%) of the firms represented in the study had between 500 and 75,000 employees. The industries most represented in the survey were manufacturing (16.7% of respondents) and finance and insurance (14%).

For more information, visit http://www.worldatwork.org.

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.

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