Your Business is Growing Employees are Gold

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THUNDER BAY – Business – Your business is growing and it comes time to reward your employees with a pay raise but is this the most effective method of compensation?  In most cases your employees are your company’s most valuable asset, and having an attractive compensation package will play an important role in keeping your current employees and attracting new ones. 

How much does it cost your business?

Giving an employee a raise will cost you more than you think.  Here is an example that compares the two in Ontario.

Note: It is important to remember that it is just an example and individual situations and benefit plans will vary.  The figures used are based off of 6 months of pay.

 

Salary Increase

Employee Benefits

Salary Increase

$1050.00

$1050.00

EI

$30.87

 

CPP

$51.98

 

WSIB

$22.99

 

Sales Tax

 

$84.00

Payroll Tax

$10.29

 

Total

$1166.13

$1134.00

The net difference in the cost for the employer is about the same.  However, for the same amount of money you invest the employee feels like they are getting much more.

How does it compare for your employees?

 

Salary Increase

Employee Benefits

Salary Increase

$1050.00

$1050.00

EI

(22.05)

 

CPP

($51.98)

 

WSIB

 

 

Income Tax

($362.40)

 

Total

$613.57

$1050.00

You can see that it may be more attractive for the employee to receive employee benefits than it is to receive a pay raise.  In addition, the plan may actually pay out more than the $1050 for the employee should they need it for health or medical reasons. 

The Bottom Line

Every situation is different, and it may depend on the business you’re in and the type of employees you have.  It is important to remember that this is just an example, and it’s always good to compare options when you’re looking at effective ways to operate your business.  Should you have any other questions about employee benefits, do not hesitate to contact me by email or phone.

Anthony TalaricoIf you would like to sign up for my free monthly investment newsletter, feel free to email me at Anthony.talarico@f55f.com with your name and email.

Anthony M. Talarico

Financial Security & Investment Representative

Anthony.talarico@f55f.com

W: 807-343-4788   C: 807-472-6092

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Anthony M. Talarico Financial Security Advisor W: 807.343.4788 ext. 4248 C: 807.472.6092 anthony.talarico@freedom55financial.com www.freedom55financial.com