When it comes to hiring and retaining talent, some employers — and most employees — sometimes forget about the true costs of employment. It’s easy to overlook the fact that the total compensation package plus taxes and other expenses add up to significantly more than just employee wages or salary.
Beyond hourly wages and annual salary, employers also have the added expenses of insurance programs, payroll processing costs, and benefits, to name a few costs. Along with mandated state and federal taxes, these expenses add up to the true cost of having an employee.
How much does an employee actually cost?
The significant difference between wages or salary and the true cost of employment matters – especially for business owners in Hawaii. With Aloha State’s reputation as a challenging place to do business, it’s important for employers to understand exactly how much an employee actually costs in order to close that gap as much as possible.
According to a recent study from the MIT Sloan School of Management, employment costs fall into several broad categories:
• Recruiting expenses
• Basic salary
• Employment taxes
• Office space
• Equipment & software
• Employee benefits
One of the largest costs is associated with employee benefits. In fact, the U.S. Bureau of Labor Statistics estimates that each employee’s benefits alone will cost an employer 25-40% above each employee’s wages or salary.
The other costs outlined above can be considered either predictable fixed costs or variable taxes and insurance programs. But those taxes and insurance programs can be difficult to predict, which adds to the complexity of adding talented people to your organization.
To help remove the guesswork and control these costs, ProService Hawaii is offering, for a limited time, a two-year rate guarantee for Workers’ Compensation, Temporary Disability Insurance (TDI), and Employment Practices Liability Insurance (EPLI).
How is ProService able to offer this rate guarantee?
ProService Hawaii’s insurance, Headland Insurance Company, has consistently generated savings for customers with its Workers’ Compensation program since 2007. Due to its low cost structure and excellent claims management, the company is able to provide the best possible outcomes for injured employees.
Additionally, as the largest and most experienced Professional Employer Organization in the state, ProService Hawaii can guarantee the best EPLI rates on the market. Not only is this crucial for mitigating risk, but this can also affect the bottom line.
The window of opportunity to lock in a rate for the next two years is quickly closing. Taking advantage of this ProService offer by September 30, 2018 will guarantee rates into 2020. With a two-year rate guarantee, Hawaii employers of all sizes can plan for the future with more certainty.
Employees are often the most expensive investment
While the true costs of employment goes well beyond wages and salary, employers today have the ability to leverage best-in-class services to reduce the burden that comes with bringing on new employees. By locking in rates and making the true costs of having an employee more predictable, employers don’t have to think twice about hiring and retaining the talent they need to help their business grow.
To learn more about this ProService two-year rate guarantee, visit proservice.com/guarantee.