How to help your clients create a solid benefits package
I recently took on a new client who purchased a company already in existence. He had no idea how to handle benefits for his employees. The prior owners had not offered any benefits, so my client wasn’t sure what to do. He was certain, however, that he wanted to keep the company’s excellent employees during what could have been an unsettling transition for them.
While money is important to employees, the benefits you can help provide may be even more important.
This is key in keeping current employees onboard and happy. It’s also a huge factor in attracting new talent, but what are the steps a client needs to take to build a benefits package?
Everyone loves time off, of course. Each state has regulations regarding Paid Time Off (PTO) and Sick Leave, and each company owner needs to be acquainted with their specific requirements. Offer vacation and other PTO, so that employees don’t have to worry about missing part of their paychecks for things like trips to the dentist or attending a special family event.
Perhaps more important to many people are health benefits and retirement plans. These are usually murky waters for new and seasoned business owners. How can you help your clients facilitate benefits for their employees?
Here are four important things to consider:
- Not every business is the same. The statistics of the staff population can help determine what would be most appreciated. Retirement plans are not as appealing to young people as they are to more mature ones. (Don’t you wish now that you had started your 401k in your 20s?) Employees with children are definitely in need of health benefits. Using your experience and expert knowledge, you can help your client determine which specific benefits will be the most important to them.
- Who will get these benefits? Make sure your client understands what your state requires. Are only full-time employees eligible? What constitutes full-time? There may be different criteria from state to state. Arm yourself with that knowledge to help guide your client’s decision.
- When will the benefits begin? On the first day of employment? The first month? After 90 days? Again, there may be requirements that frame this choice.
- How much will the company pay? Some companies pay all of the insurance premium. Some pay half. You can help your client decide what their budget will be, which will determine the type of insurance and the percentage they will pay.
Once you have been through these steps with your client, how do you know what to do next?
If your clients are using QuickBooks® Online Payroll, the choices are easy to see. You’ll be able to view the different options side by side, so that you and your client can decide what’s best for them and for their employees. QuickBooks Online Payroll offers fully integrated options for 401(k) and health benefits, with the ability to easily set up automatic paycheck deductions for employees.
Next comes the mystifying process of setting up everything in the books. Some of the things your client will need:
- Health Insurance Expense account: How much will the company pay vs. how much the employee pays?
- Health Insurance Payable account: The liability of the total payment
- 401k Liability account: The amount to pay
- 401k Company Match: Flat fee or percentage of income?
- Processing Fees, if any
With QuickBooks Online Payroll, the system will help you figure out these numbers, assign them to accounts and process each payroll to the proper categories. It may be confusing to your clients at first, but once you show them the method inside of QuickBooks, it will begin to make sense.
- September – Start the conversation with your client. You’ll need time to study the appropriate choices and determine what fits the budget and meets their team’s needs.
- October – Enroll the company in the benefits that your client has chosen.
- November – Set up the benefits with the payroll process. Open enrollment for the employees. Help your client answer any questions. Make sure everything is set on the bookkeeping side.
- December – Ready to go!
You don’t have to be a benefits guru to look like one – especially to your clients. With a little bit of research and help from QuickBooks Online Payroll, your clients will appreciate how easy it is to get set up. The employees will be happy, and that helps keep them on the team. Everybody wins!