Budgeting for Benefits

[Guest jnewmarch]

I work for a Software company in Seattle and am doing some research on what other high tech companies are using to budget for employee benefits. We use a per head amount and am wondering what other companies are using and what that amount includes. Can you help?

[Sheila K]

jnewmarch:

We don't use a per person amount for benefits. We do pay our part-time people a 12.5% premium to make up for the benefits that they do not receive (medical/dental/vision/flex) This calculates to about 1/2 of what we have calculated our benefits to be worth. We figure that 25% of an employee's annual salary is used for benefits (this includes vacation, etc. also).

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Good Luck!!!

Sheila K 8^)

602 683-1013

[Guest M. Johnston]

Where I used to work, "benefits" (i.e. insurance, 401(k), vacation, service awards, misc. fringe benefits - anything with an employer cost tied to it)were budgeted as a percentage of projected gross payroll for the upcoming budget year. Total benefits were usually projected to be 23-25% of gross payroll.

[Greg Judd]

Big, messy,ugly subject -which you may be able to boil down this way:

avg budget: 33% of payroll

made up of:

statutory benefits (8.5%)

health (8%)

retirement/capital accumulation (7%)

pay for time not worked (8%)[a category often left out - the US Chamber of Commerce numbers count it, but lots of sources, & employers, don't]

other (1.5%)

Be sure to adjust for items like organization size (# employees), industry, ownership, date of origin, geographical dispersion of employees, and numerous other factors.