Case Study: Sugar Plum Salon

Sugar Plum Logo
Industry Esthetics/Cosmetology
Location Seattle, WA
Website sugarplum.com
Full-time employees  40

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Sugar Plum couldn't find a group health insurance policy that fit the diverse needs of their employees. Small businesses in their industry rarely offer any benefits, but Sugar Plum was determined to provide their employees with a personalized health care solution and stand out in their field.

PeopleKeep’s QSEHRA provided Sugar Plum the ability to give employees tax-free money to pay for their health insurance premiums and out-of-pocket medical expenses, which meant each employee could use their allowance on whatever fit their specific needs.

Since offering the QSEHRA, employee satisfaction is currently at 100%, and both employee retention and offer-to-hire rates have increased as well. The tax-free reimbursements have saved Sugar Plum $19,000 in taxes that they’ve been using to fund other business operations.

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“So many people apply to work here because they've heard about our benefits.”

Jessica Muller

Sugar Plum in Seattle, WA

15-20

minutes per month

$19,000

projected annual tax savings

100%

average employee satisfaction rating

“Every single person who comes in to interview [is] either shocked we offer the benefits we do, or it's the reason they came in."

The company

Founded in 2011, Sugar Plum is a sugaring, body hair removal service that approaches beauty care through social, environmental, and economic sustainability. Sugar Plum was voted best waxing salon in the Seattle Weekly Reader's Poll in 2017 and operates five locations in the Puget Sound area.

The challenge

It's rare for a salon or spa in the personal beauty industry to offer health benefits. However, Sugar Plum was eager to offer health care benefits from the start, both to stand out from their competition and to fulfill their commitment to providing employees a living wage and great benefits.

"We got some quotes for group, but nothing really felt like it would be right," said Jessica Muller, corporate office director for Sugar Plum.

The company employs people with a wide variety of needs. Some are on their parents' or spouse's insurance, while others require a higher level of care for their families—and finding a traditional group health insurance policy that fit everyone was difficult. Sugar Plum needed an option that would supplement their employees’ policies and give them flexibility over their medical expenses.

The solution

After running into a dead end with group health insurance, the Sugar Plum team turned to a new health benefit they'd heard about: the qualified small employer health reimbursement arrangement (QSEHRA).

"For me, the biggest thing that stood out was how hands off I get to be with PeopleKeep. Just loading a report every couple of weeks and approving reimbursement requests was right up my alley."

Muller decided on PeopleKeep’s Premium Plus QSEHRA which allows for reimbursement of insurance premiums and out-of-pocket expenses. She especially loved that PeopleKeep’s team would handle the majority of the benefit management like document  generation and review, employee notifications, customer support and employee education. Muller would only be responsible for approving reimbursements in a few minutes each month.

Employees loved the new benefit after learning it provided a monthly allowance of tax-free money they could use regardless of their insurance coverage situation. Sugar Plum was now able to offer a health benefit that would provide value to all of their employees.

The results

Sugar Plum employees were "absolutely thrilled" to have a benefit through PeopleKeep, Muller said, reinforced by a recent employee satisfaction rating of 100%. They even had one employee, who was previously thinking about resigning to find health benefits elsewhere, decide to stay.

Not only do current Sugar Plum employees stay with the company longer, but the company has better luck finding new employees, too. Job applicant interest in the health benefit has increased the number of applicants they’re getting for open positions as well as offer-to-hire rates.

"Every single person who comes in to interview, either they’re shocked we offer the benefits we do, or it’s the reason they came in," Muller said. "We have a great reputation in the community and it’s helped support our amazing growth."

Muller finds the reimbursement process very easy and quick. In about 20 minutes per month, she can log in, update employment information, and process reimbursements in a few clicks of a button. The hands off nature of self-administering the benefit is a big plus for company time management. Even better, Sugar Plum has saved an incredible $19,000 a year in taxes by selecting the QSEHRA benefit.

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