| Blog

3 Basic Benefits For Small Business Employees

Written by: PeopleKeep Team
January 28, 2015 at 3:00 PM

It’s no secret offering benefits will make a dent in your small business’s profits - however, the pros of offering small business health benefits far outweigh the cons. You’ve got to choose: offer benefits, or risk losing your most valuable employees. Which makes me wonder, what are basic benefits you should be offering your small business’s employees? Here are three of the most basic and crucial benefits you should be offering - or seriously considering.

Why Do I Need Basic Benefits for my Small Business?

So, what are the pros and cons of offering basic benefits to your small business? Let’s take a look:


  • Better recruiting and retention

  • Improves employee morale

  • Contributes to productivity

  • Tax advantages

  • Ability to expand your business


  • Cost

  • Rising health insurance costs (if you offer group health insurance)

Though the pros and cons list could each be longer, the pros easily outweigh the cons. Knowing this, let’s talk about what type of basic benefits you can offer your small business employees.

Basic Benefit #1: Healthcare Benefits

First, and most importantly, is health insurance. Why? Health insurance is not only a good thing to have in the case of an accident or illness, but it’s required by law for each individual to have it (individual mandate). So, by offering your employees affordable healthcare benefits, you’re providing a way for them - and yourself - to remain compliant and have the coverage they need.

You might be thinking there are little-to-no affordable healthcare benefits options for small businesses, but this isn’t the case. Affordable health insurance options include SHOP (if you have fewer than 50 employees), individual health insurance, or a private health exchange.

While each of these are an affordable alternative to traditional employer-sponsored group health insurance, the most affordable is generally individual health insurance - costing 20 to 60 percent less than group health insurance.

Additionally, many small business employers are moving towards reimbursing their employees for their individual health insurance premiums as a tax advantage to both the employer and employee, and also to keep more money in the pockets of their employees and in the business.

Basic Benefit #2: Retirement

You may be a small business, but retirement is just as important to you and your employees as it is if they worked for a large corporation. What can you do? Offer a retirement plan.

You can offer a defined contribution retirement plan such as a 401(k) rather than a pension. This way, it will encourage your employees to set aside their own funds for retirement every pay period. And if you have the means, match your employees’ contributions up to a certain amount as well.

Defined contribution retirement plans allow your employees to invest their money how they would like to through a choice of mutual funds. Furthermore, offering retirement for your employees encourages them to stay with your company longer - as some other companies may not offer this benefit.

Basic Benefit #3: Paid Time Off (PTO)

Let’s be honest, would you work for an employer who did not offer paid time off (PTO)? I didn’t think so. PTO, like healthcare benefits, has become a must-offer benefit for companies both large and small.

Why? Three words: sanity, financial security.

In other words, employees will feel trapped if they cannot take a day off without losing out on pay for the day. And we all know a day off every once in a while (aside from weekends) is completely crucial to our sanity. Plus, sometimes emergencies arise and we don’t have a choice.

If you do not offer PTO to your employees, when the inevitable day does come that your employees need a day off, they will be forced to take an unpaid day - sometimes causing a financial strain.

In short - don’t skip offering PTO.


Offering the most basic benefits to your employees isn’t something you should ever consider skipping out on. Why? You’ll risk losing some of the best employees you have, and you may have difficulties hiring in the future.

Though offering healthcare benefits, retirement, and PTO are certainly an expense, you should look at them as a profitable investment for your small business.

Besides these three basic benefits, what other benefits would you say are important to offer? Comment below, we’d love to hear your thoughts! 

Topics: Health Benefits, Human Resources

Additional Resources

Trying to decide which HRA is best for you? Take our quiz to find out.
Get our guide on how to offer health benefits with a small budget.