New research shows how companies are responding to a call for mental health support, work-life balance, equality in the workplace, and social responsibilities.
By Lesley Grady
The year 2020 was unique for employees and companies alike. Many factors impacted the way companies outlined and administered their people policies during the global pandemic. First, a myriad of federal, state, and local ordinances mandated sick leave for employees and their families. Second, several states introduced, and some passed, paid parental and family leave legislation. Finally, many social and economic disparities and injustices were brought to the forefront and companies had to respond quickly and commensurately to their employees and the public.
As the most challenging year in a generation ended, companies realize that many of the temporary solutions they implemented in response to these challenges are critical permanent policies. Sequoia’s 2021 Employee Experience Benchmarking Report found that workplace cultures are changing as employees seek greater focus on mental health support, work-life balance, equitable focus on diversity and inclusion, and social responsibilities. Companies are responding to this shift. As a result of the changing workforce, here are four critical areas companies should consider integrating into their policies and programs.
1. Prioritize well-being by placing an emphasis on family mental health support. The pandemic continues to drive an unprecedented need for mental health benefits and offerings to help employees and their families face new challenges brought on by the pandemic. As employees struggled with childcare, productivity, and the effects of physical distancing, 50% more companies strategically focused on employee emotional health in the past year (for a total of 82% of companies). Moreover, children have experienced major disruptions as a result of the pandemic: school closures, isolation, gaps in healthcare access, social inequities, and financial hardships.
Companies should prioritize and promote family mental health well-being by voicing support from the top down to create change and normalize the discussion.
Evaluate and invest in mental health, behavioral health and substance abuse programs, highlight areas of opportunity, and take action to close those gaps.
One way to support mental health is through flexible time-off policies. While flexible time-off programs can pose their own unique challenges, some companies are going a step further with 33% implementing mandatory “recharge” days and 20% offering annual company shutdowns to make sure their employees disconnect from the workplace.
To complement paid time off, companies should evaluate opportunities to increase the number of annual paid holidays. In 2020, just 67% of companies offered 10 or more paid holidays. That number has now risen to 80%, in part due to increased awareness and conversations about racial injustice. Juneteenth, Indigenous People’s Day, and MLK Day are becoming more common paid holidays.
2. Keep up the action around diversity, equity, and inclusion initiatives. The inequitable effects of the pandemic and spotlight on racial justice brought a renewed focus on diversity, equity, and inclusion (DEI) in the workplace. While acknowledging the importance of DEI in the workplace and dismantling discriminatory practices is a step in the right direction, real change comes with real work. Companies must create and follow through on action plans and invest in resources and talent to achieve their DEI goals.
Over the last year, 70% of companies rolled out new DEI programming, including educational events with internal and external speakers, and trainings for hiring, unconscious bias, anti-racism, and more. Companies are leveraging the momentum they gained in 2020 to power ahead. Seventy-nine percent are offering DEI training, 72% are using diversity recruiting resources to build a more equitable workplace, and 26% are sponsoring employee affinity groups.
With an increased focus on DEI practices and programs, companies are making modifications to their healthcare policies to enhance transgender benefits. Forty-three percent of companies offer coverage that aligns with World Professional Association for Transgender Health (WPATH) standards. More and more employees are considering this an essential benefit for an employer of choice.
3. Expand health benefits to include family planning resources. After a year consumed by a global health crisis, health benefits are becoming more comprehensive than ever before. Companies should continue to focus on taking holistic care of their employees, including more support for employees to plan and build their families. A majority of companies across the globe are offering parental leave beyond the local mandates and in the U.S., 76% have a parental plan exceeding statutory minimums.
Additionally, it is top of mind for 81% of companies to have the flexibility to offer equitable comprehensive fertility benefits for all employees. These practices support core DEI initiatives to ensure all employees regardless of sexual orientation, health status, race, gender identity, or age have access to essential family forming benefits. Companies are expanding coverage to include egg preservation/freezing, donor eggs/sperm, preimplantation genetic screening, and surrogacy and adoption benefits.
4. Incentivize retirement savings participation with ESG offerings. The pandemic impacted employees’ spending and savings, with spending in the U.S. declining while the personal savings rate reached the highest level in recorded history. Interestingly, there was no significant impact on retirement plan participation and contributions. Companies should continue to experiment with ways to encourage plan participation. This may include offering matching programs, automatic enrollment, and access to financial literacy tools.
Some companies are building environmental, social, and governance (ESG) funds into their retirement plan offerings as they increase their focus on social responsibility and workplace diversity. Of companies with retirement plans with ESG funds, a third added the funds in the past year.
Throughout the pandemic, companies did not waver in their commitment to the health and well-being of their employees. As companies return to the office or embrace hybrid workplace models in an extremely competitive job market, remaining cognizant of changing workforce demands and ensuring the evolution of their employee experience strategy will be critical.
Lesley Grady is the vice president of the enterprise practice for Sequoia Consulting Group.