Franchise operators are individuals or entities that own and operate one or more franchise locations of a larger brand. In the franchise business model, the franchisor grants the franchise operator the right to use its trademark, business model, and operating systems in exchange for a fee or royalty payments.
Franchise operators are responsible for managing all aspects of the franchised business, including day-to-day operations, staffing, marketing, and financial management. They must adhere to the franchisor’s standards and guidelines to maintain consistency with the brand and ensure a uniform customer experience across all locations.
Businesses work and grow with a healthy and productive workforce. To ensure that happens, franchise organizations have a lot of responsibility on their shoulders. They have to take care of their employees, as well as their franchisees. In turn, franchise operators are responsible for their employees. Therefore, a vast network of individuals within the umbrella organization must be considered.
Group benefit plans are employee benefit plans that cover all eligible members (i.e. all employees working for that organization). However, plans can vary in terms of contributions made by employees. Typically, the HR Department and Senior management work in collaboration with benefit consultants to deliver a structured package that is favourable for both the employer and the employees.
Nearly 7 out of 10 employees say having an array of benefits would increase loyalty to their employer, according to the
Metlife Employee Benefit Trends Study, 2020.
Provinces in Canada cover almost all diagnostic procedures, medical tests, and hospitalization. However, we all know that there are many conditions and tests still requiring employees to pay out of pocket. Furthermore, if a serious medical condition is diagnosed, it is difficult for a low-medium-income employee to cover the costs.
There are many benefits why franchise operators should invest in a group benefit plan, let’s discuss the most important ones here.
- Attract Talent
Benefits make a valuable addition to the salary and compensation structure for any employee. When deciding between jobs, an employee will think about comparing the benefits packages. Having best-in-class benefits programs can assist high-level talent in choosing to work for your business, instead of a competitor.
- Lower Employer Turnover Rate
According to Glassdoor Employment Confidence Survey done in Q3, 2015; 4 in 5 employees want benefits or perks more than a pay raise.
In fact, as stated by Profit’s survey, non-competitive benefits and compensation are the second reason why employees leave their organizations, the first being a bad boss. It can be costly to hire and train employees, only to have them leave shortly after. By offering best-in-class benefits, your business can achieve a lower employee turnover rate.
- Great Way to Attract Small Businesses to Join Your Franchise
Many small companies are looking to become franchised business owners. For example, individuals such as new immigrants and recently graduated students may be interested in working with a licensing agreement, so they can do what they are familiar with, under the umbrella of a bigger corporation. The upside of joining a franchise with their business is having access to already existing investment and benefits plans. Presenting benefit plans as an incentive for small businesses to join your franchise organization is profitable because as a franchise owner, the more locations you own, the higher your gross income will be.
- Benefits are Tax-Free
Small franchise owners are usually budding entrepreneurs with limited budgets and for them, every penny counts. It is great to see some savings on your taxes each year. Employers can qualify and save on tax credits when they offer insurance to their employees. The tax credit compensates (to some extent) for the money payable to the insurance company.
- Group Benefit Plans Increase Employee Loyalty and Motivation
Surveys say that a happy employee is a productive employee. If you can keep your employees happy by caring about them and going that extra mile, that will bring peace of mind and increased morale to the team, increasing productivity and revenues.
- Comprehensive Group Benefit Plans are Key to Employee Well Being
According to Metlife, a comprehensive benefits program is the third driver of holistic well-being. When employees keep their well-being in check, sick leave is less prominent, and employees are less likely to feel burnt out.
- Group Benefit Plans are Cheaper
The more members included in a group insurance plan, the lower the insurance premium will be for the company and its employees when compared to individual plans. This is great for franchise owners, as you will be providing benefits to many teams in many locations.
Group Benefits Plans operate by providing a range of insurance and perks to employees, typically within a group setting. Here’s how these plans work and what they entail:
Employees are typically enrolled in Group Benefits Plans upon joining the company or during designated enrollment periods. The number of people covered under the plan varies depending on the employer’s policy and the type of coverage selected. In most cases, employees themselves are the primary beneficiaries of the benefits, but they may also have the option to include their families for additional coverage.
Many Group Benefits Plans extend coverage to employees’ families, including spouses and dependent children. The extent of family coverage varies depending on the specific benefits offered by the employer. For example:
- Health Insurance: Family coverage often includes spouses and dependent children, providing them with access to the same healthcare services and benefits as the employee.
- Dental and Vision Coverage: Family members may also be eligible for dental and vision benefits, allowing them to receive routine check-ups, treatments, and eyewear.
- Life Insurance: Some plans offer optional life insurance coverage for spouses and dependent children, providing financial protection in the event of their death.
- Disability Insurance: Disability benefits may extend to cover family members in certain circumstances, such as providing caregiver benefits for spouses or dependent children with disabilities.
- Extent of Coverage: The extent of family coverage varies depending on the specific terms and conditions of the Group Benefits Plan. Employers may offer different tiers of coverage with varying levels of benefits and premiums. It’s essential for employees to review the details of their benefits package carefully to understand the extent of coverage available to their families and any associated costs or limitations.
- Cost Sharing: In many cases, employers subsidize a portion of the premiums for Group Benefits Plans, but employees may be required to contribute towards the cost of coverage, especially for family members. Employers often offer multiple coverage options with different premium amounts, allowing employees to select the level of coverage that best suits their needs and budget.
Overall, Group Benefits Plans provide employees and their families with access to essential insurance coverage and perks, promoting financial security, health, and well-being. Employers play a crucial role in selecting and administering these plans, ensuring that they meet the needs of their workforce, while also managing costs effectively.
A well-designed Group Benefits Plan not only attracts top talent but also fosters a positive workplace culture. Here are additional insights into optimizing Group Benefits Plans to maximize employee and franchisee satisfaction. As mentioned, a great benefits plan is one of the primary factors employees look for before joining an organization. The employee will also be interested in what kind of benefits are provided, as each individual may have unique needs.
Basic plans that the majority of organizations are providing to their employees include the following:
- Prescription Drug Plan
Medical diagnosis, tests, hospitalization, and other medical bills are covered by almost all provinces in Canada, due to our public health system. However, prescription drugs are not included in that coverage which can put a strain on families and individuals. These expenses can escalate quickly if an employee or family member has a long-term disease such as hypertension, thyroid problems, Diabetes, or a variety of serious conditions. By including prescription drug insurance in your group benefits plan, a weight can be lifted from many.
- Dental Plan
Another cost that is not covered in the public health system at present is Dental, and we can all agree that dental treatment and procedures are expensive in Canada. To take care of those expenses for their employees, companies usually invest in a dental plan which covers up to a certain extent in a year. If the expenses exceed the limit, the employee is usually informed beforehand, regarding paying out of their pockets.
- Accidental and Disability Plan
A newer benefit that is now being commonly used as a baseline is the accidental and disability plan. Although nobody wants to talk about workplace accidents, it is needed for your business to prepare for the worst. When an employee opts for this plan, they are covered in case of an unfortunate incident. In case of their death, their families are provided with monetary benefits.
- Vision Plan
Vision is important to an employee’s quality of work. If this gets affected, an employee might not be able to perform their usual tasks in the same manner. Covering vision plans including eyeglasses, and laser surgeries is a great benefit to provide to your employee network.
- Life Insurance:
Life insurance provides a financial safety net for employees’ loved ones in the event of the employee’s death. It pays out a lump sum or periodic payments to designated beneficiaries, helping to cover expenses such as funeral costs, outstanding debts, and ongoing financial obligations.
- Retirement Savings Plans:
Retirement savings plans, such as 401(k) or pension plans, help employees save and invest for retirement. These plans may include employer contributions, matching contributions, or other incentives to encourage employees to save for their future financial security.
- Wellness Programs:
Wellness programs promote employee health and well-being through initiatives such as fitness programs, nutrition counseling, stress management workshops, and smoking cessation support. By investing in employee wellness, employers can reduce healthcare costs, improve productivity, and enhance overall employee satisfaction.
- Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs):
FSAs and HSAs allow employees to set aside pre-tax dollars to pay for eligible medical expenses not covered by insurance. These accounts offer tax advantages and flexibility in managing healthcare costs, empowering employees to take control of their healthcare spending.
It’s always a great idea to think about your franchisees’ and employees’ well-being, and they in turn will help you grow and expand out of loyalty. Having read about all the benefits of a group benefits plan, if you wish to incorporate that for your employees and/or franchisees, reach out to one of our Benefit Experts, and we will help build a customized and comprehensive plan for your business.