Are Health & Welfare Benefits Worth the Cost for Your Employees?
At Helios, we frequently help our clients survey employees to understand everything from engagement to skill development to benefits needs. Particularly in the era of an evolving healthcare environment, employers need to get the most for the budget dollars allotted to benefits, and the best way to do that is to understand what employees want. As a Human Capital consultant, I advise surveying employees at your own company to discover what matters most to them.
If it's crunch time during your benefits renewal, and you don't have the time to survey your team, these two recent studies by Unum and Aflac can provide you with the insight you need to understand how benefits can make a difference at your company.
In case there was any doubt about how significant benefits are, the Aflac Workforces Report for Small Business offers this attention-getting statistic: 57 percent of those surveyed said that they would accept a job with slightly lower overall compensation but better benefits.
Benefits are a difference maker, and even small businesses cannot afford to ignore their role in attracting good employees.
Unum’s study also showed a direct correlation between how employees view their benefits and how they think about their jobs. In a survey of over 1,500 working adults, roughly 75% of those employees who said their benefits were excellent or very good also rated their workplace above average.
What can employers do to make sure that they’re providing benefits that are valuable and desirable?
The key may lie in employee engagement and education around benefits. According to Unum’s result, nearly 30 percent of employees stated that the information they received from their employer was fair or poor.
Think about how this applies to your business:
- Do employees know what their deductible is?
- If you offer an HRA or HSA, do employees know how to use these accounts to help manage their out-of-pocket costs?
- What about wellness incentives?
- If you’ve made changes in the past year, have you held post-enrollment meetings to help address employee questions on new plans and features?
As part of an overall change management methodology, continuing to educate employees even after changes have been made can go a long way toward smoothing over difficulties and positively impacting employee perception of their benefits.
What can employers do if they are facing higher renewals?
This year, many small business plans are facing sharp cost increases. If you have to change your plan design to manage cost, educate your employees about why and, if possible, involve them in the decision.
For example, you may have determined that your current plan is not affordable going forward. Instead of just getting rid of it, you could ask employees if they’d rather pay a higher deductible to keep the plan affordable for the company or pay a more significant share of the monthly costs instead.
If your employees feel as if they’ve been consulted, they are more likely to react favorably to whatever changes you make.
Every company has a cadre of employees who are highly invested in the benefits you offer or have strong opinions. Sometimes they can spread discontent and misinformation amongst everyone else. One tactic I’ve seen work well is asking these employees to be part of a benefit committee. If you give them the full picture of what benefits cost the organization and involve them in the decision to help manage costs, they go from being malcontents to advocates for change.
How important is it to offer voluntary benefits to employees?
Voluntary benefits can also make a difference for employees. Aflac’s report revealed that just eighteen percent of small companies offer voluntary insurance to their employees. Fifty percent of employees at small companies who don’t have access to voluntary insurance benefits say they’d be likely to purchase such benefits if they were offered by their employers. So work with your human resources team and your broker to determine what voluntary benefits can be provided, starting with a survey of competitors' offers. This type of benchmarking should be a complimentary service your broker provides to help you better understand the marketplace.
The next few years are sure to hold many more changes to the benefits landscape, but it’s inevitable, despite these changes, that employees will still value employer-provided benefits. Given all of the changes, it’s never been more critical to help employees understand your plans and communicate the value of what you offer. If you are interested in exploring benefit brokers and consultants, we recommend our partners at NFP.