Cost of Benefits By Employee

Jessica

We are working to better understand (and control) the cost of our benefits package. We have a broad package of benefits which are entirely employer paid and, needless to say, that has been progressively more difficult to maintain over the last four or five years. I have been asked to calculate the cost of benefits for each employee, and then find our average cost as a percentage of gross salary. I have two questions. First, what elements of the benefit package do most companies include in that calculation? For example, do you include employer paid taxes as a benefit? Second, what is a good target range as a percentage of gross salary?

Margaret Morford

Jessica,

Include everything in your benefits calculation... taxes, worker's compensation, holiday pay, vacation, etc. The benefits percentage will usually range from 25% of base pay to 35% of base pay.

Margaret Morford
theHRedge
615-371-8200
[email]mmorford@mleesmith.com[/email]
[url]http://www.thehredge.net[/url]