The Business of Better Benefits Providing a first-rate benefits package for employees can be an important part of the recruitment and retention puzzle, especially for small businesses

Why Benefits Matter
Patrick Carragher, director of benefits for CheckPoint HR, a firm in Edison, N.J., that provides human resources management, payroll services and employee benefits, offers expert insight on small-business benefits challenges.

What's new on the benefits front?
Companies are running on leaner budgets and many have cut back their human resources departments, but there is still market competition for the best employees. And those employees' needs have changed dramatically, so they are demanding consumer-driven cafeteria plans that may have multiple options for health coverage, vision coverage and other benefits. Employees have the ability to use a fixed amount allotted to custom-design a package. Five years ago, if that was 5 percent of the market, it was a lot. Today, it's 50 percent of our client base.

How can small businesses offer plans that are competitive with those offered by larger firms?
They must keep looking at the needs of their employees. Many companies purchase plans and stay with them for years, simply watering down the benefits to save money. Instead, they should be looking at which benefits are used and which aren't. There may be too much benefit in one section of the plan. For example, if a hospital confinement benefit is only being used by 4 to 5 percent of the population, then eliminate it and offer it on a voluntary basis to employees for a very small premium that may come out of the overall allotment they have to choose and customize benefits.