HR News

Using Benefits as a Retention Tool

Open enrollment has traditionally been the root of great frustration for many employees. Now, employers are adding ease to the process to improve the overall experience and retain their talent.  

By Zee Johnson  

With inflation lingering and many organizations in or approaching open enrollment, Alera Group’s 2023 Healthcare and Employee Benefits Benchmarking Report captured the most common employer experiences, sentiments, and challenges surrounding employee benefits and human capital management. And with 43% of workers citing not having good benefits as a reason for leaving an organization, the survey also revealed how leaders are using proven strategies to help retain high-caliber employees. 

Here are the survey’s most notable findings when it came to recent benefits trends. 

  • Medical plan rates increased. The majority of respondents (85%) said they experienced an expected rate increase on their medical plans, an average of about 8% year-over-year for comparable plans, even if there were no changes to their plan design. The leading cost drivers included disease-management programs, diabetes (91%), obesity (62%), and hypertension (73%). 
  • More employers are offering supplemental benefits to bolster retention. More than 75% of larger employers offer life insurance and that same number offers protection for long- and short-term disability. Just about all employers offer vision and dental insurance, and coverage for behavioral health challenges and substance abuse disorders has become more common.  
  • High-deductible health plans (HDHPs) decline in popularity. While HDHPs offer a lower monthly premium and a higher deductible, they only account for 29% of the plans that respondents offer. Most companies are moving away from HDHPs in favor of preferred provider organization (PPO) plans to remove barriers to primary care. 
  • Pharmacy specialty tiers multiply. More than half of survey respondents said because of rising pharmacy costs, they now offer four or more tiers in their pharmacy plans. 

In analyzing the findings, many employers recognized that too much technical talk can quickly bewilder employees who are just trying to make the best decision for themselves and their families. This perplexity leads to a rolling of the dice when picking a plan, often misguidedly choosing the more expensive option.  

“Since employees are also consumers and bring that mindset to their benefits, many risk thinking that a higher-priced health plan is the best when in reality, that’s not always the case,” says Sally Prather, executive vice president and employee benefits practice leader at Alera Group. “After all, a fancy sports car may be nicer and more expensive than a minivan, but it won’t be useful for a family of four or more. The same holds true for benefits.”  

Employers can make the process easier by streamlining their correspondence and making communications clear and concise. That way, all employees know exactly what they’re getting. “Benefits communication should include the details employees need to make good choices at the time they are choosing and using their benefits. They should speak to employees in a user-friendly way, avoiding jargon and ‘insurance speak’,” Prather says. “They should meet employees where they are in print, online, and in-person, since there are five generations in the workforce, each with their own learning style and communication preference.” 

Prather also says that leaders should be using company data to narrow in on the offerings that employees want to see most. The most insightful healthcare analytics that leaders can leverage include: 

  • usage rates; 
  • claims; and 
  • information regarding employee behavior, health, and well-being programs. 

This information, she says, has been quite powerful for her company and for clients. “We’ve seen it time and time again in working with our clients to analyze data they can then use to make improvements in plan design and costs. We help them gather and pore through information to cull trends and insights that support them in making positive changes and creating meaningful benefits programs that drive employee satisfaction.” 

But by far the best way to ensure employees are knowledgeable and confident in their selection is by allowing them to have a say in company offerings. This can happen by capturing feedback through benchmark surveys, suggestions boxes, one-on-ones, and more. In fact, an Achievers survey found that employees who say their employer takes meaningful action on their feedback are 37% less likely to job hunt, therefore, 37% of leaders are prioritizing better listening and taking action on employee feedback to engage and retain talent this year. 

“Employers need to develop feedback programs that make it easy for all employees to be heard and their input weighed and acted on with the appropriate measure,” she says, while urging employers to be ready to take action on the feedback they receive. “Employers must also be careful about the feedback they’re looking for, especially if they’re not prepared to act. Those who ask for feedback on what benefits employees would like to see offered and then don’t do anything about it or communicate well, can do more harm to employee relations than good.” 

One in Five Employees Asked to Work During Vacation

35% feel an implicit expectation to work through vacations, leading to lowered productivity, heightened attrition, and a bad workplace reputation. 

By Zee Johnson 

Many consider the summer to be the perfect time to take a much-needed vacation. But some employers are saying no so fast. According to a new report by ELVTR, one in five U.S. workers say they are being asked to work while on vacation; the same amount say they get asked to check their email; and 25% are bombarded by work-related text messages. 

While some employees can easily toss their devices off to the side, others struggle with a sense of pressure and obligation to respond. In fact, 57% feel anxious if they don’t check their work emails while away, and 46% have trouble switching off during their downtime. 

Viktor Grekov, founder and human resources director at Oboard, says that with 75% of Americans living in fear due to widespread job loss, many believe they’ll face consequences if they don’t take on a surplus of work—even if out-of-office. “Teams are already down to their bare bones following last year’s wave of layoffs, so with no one to delegate to, those that remain pick up the slack in the hopes of preserving their livelihood,” he says. “However, it’s not always by choice. Some feel that they are obligated to stay connected, even if it’s not stated in their contracts.” 

And it appears to be a lose-lose situation—73% feel guilt while working on vacations, and 41% feel guilt if they don’t.  

Grekov explains both the short- and long-term consequences of encroaching on employees’ personal time. 

  • Short term: Workers suffer from increased stress and health issues, reduced productivity, and fewer growth opportunities.  
  • Long term: Innovation slows, turnover rates skyrocket as workers seek better work-life balance elsewhere, and employers get a reputation for disrupting their employees’ personal time. 

Further intensifying the matter is the fact that companies aren’t providing any additional compensation or incentives for work performed during off-time. “The harsh reality is that 28 million Americans don’t get any paid vacation time at all, let alone for all the additional hours they’re now putting in,” Grekov says. “With companies having cut over 500,000 jobs in the U.S. alone this year, it’s a bill that many are likely unable to cover. However, business is a team effort, and failing to compensate for hard work is a surefire way to curb productivity.” 

Ultimately, infringing upon employees’ time when they’re away signifies a poorly executed company strategy, and Grekov says that managers must take the lead in fixing the problem. “Businesses should make clear that they do not condone encroaching on employees’ time off by putting comprehensive policies and procedures in place regarding absences,” he says. “The responsibility then falls on managers to lead by example. Take your vacation, make clear who to contact in your absence, set your boundaries before you leave, and offer the same respect to your colleagues when they’re away.”

The fix won’t happen overnight, but businesses cannot afford to continue with the same, inoperative practices. “When faced with immediate challenges, like shortages, businesses shouldn’t lose sight of their long-term goals. Encouraging employees to sacrifice their personal time won’t save your business; you’re simply delaying the productivity loss,” he says. “Burnout ensues, productivity tanks, and deadlines are missed. That poor foresight doesn’t just affect a particular team but causes company-wide delays that can have detrimental effects on results and revenue.” 

The Impact of ERGs on Employee Wellness

For individuals who don’t feel connected at work, employee resource groups can heighten their sense of well-being and inclusion. 

By Zee Johnson 

Inclusion plays a foundational role in many workplace elements, like engagement, retention, satisfaction, and productivity. Yet, a recent survey showed that 50% of workers feel excluded and isolated, and when it comes to Black employees, that number jumps to more than 75%. To fix this, leaders can provide outlets that foster equity, wellness, and connection—cue employee resource groups (ERGs). 

ERGs are associations of people and allies in the workplace with similar interests, backgrounds, struggles, and more, coming together to create a safe space for exchange. 

In a recent survey, 90% of respondents said that ERGs offer opportunities for professional development, skills building, and growth. And Jenni Kovach, chief people officer at IGS Energy, says they’ve recently grown in importance because they galvanized employees in more ways than one. “Employee groups have become increasingly prevalent in recent years, as employees place more and more value on having spaces in which to bond over shared experiences, expand their worldview, and make an impact where they live and work,” she says. “They offer a unique opportunity to foster a culture of inclusion and belonging, as well as opportunities to network with people across the business.” 

When ERGs, or “Communities” as Kovach calls them, were introduced two years ago, ISG wanted to ensure employees had as much input as leaders. After all, these groups were brought in to support them and not the other way around. “Though we’ve always had opportunities for employees to connect with like-minded people, we intentionally chose not to pre-establish employee groups, instead, encouraging our employees to offer their ideas and take part in this effort,” she says. “Communities are intended to be identified, created, and led by employees, and employees share with the organization which groups they’d like to create.” 

Some of the most common ERGS found in the workforce include groups for working parents, Black employees or employees of color, individuals with disabilities, and members of the LGBTQ+ community. In fact, a survey discovered that 42% of LGBT+ respondents reported experiencing non-inclusive behaviors at workbut 93% say that ERGs have helped them feel like they belong. And research from Qualtrics shows that employees who feel like they belong at work are almost three times as likely to have a greater sense of well-being: 78% versus 28%. 

Kovach was instrumental in curating her company’s “Communities” to help drive diversity, equity, inclusion, and belonging (DEIB). “These employee groups offer a platform for traditionally underrepresented employees to have a collective voice and be able to discuss and amplify the issues that matter to their communities most. 

Four of ISG’s Communities include: 

  • IGS Pride (supporting LGBTQIA+ employees); 
  • Living La Vida Latinx (supporting Latinx employees); 
  • Melanin Moments (supporting Black and African American employees) and; 
  • IGS Women’s Network (supporting the women of IGS). 

While some feel that ERGs aren’t as effective or fruitful as they claim to be, especially since they’re almost never mandatory, pressurizing participation could prove counterproductive to the end goal.  

Kovach says that having them remain voluntary will guarantee that those who join are there because they genuinely want to be. “Giving employees the choice to join a ‘Community’ that they identify with and determine their level of involvement in is important to ensure our employees experience these groups in a meaningful and uniquely fulfilling way,” she says. “Our stance is that participation should be voluntary and encouraged. We see our ‘Communities’ as a valuable benefit for employees [that] they’re invited to experience in the way that best suits them and their life.” 

To ensure longevity, Kovach says that leaders must provide the necessary assistance and resources to keep them thriving, as is done at ISG. “We assist employees in creating and managing these groups, we’ve developed resources that ensure they have structure, leadership, and a set of goals and outcomes they’re focused on,” she says. “Communities are required to have a leader-sponsor that lends support and guidance, and each group receives a budget to financially support their programming, events, supplies, and resources that are part of their work.” 

Industry Insights

From our Flash Report, 2023 CHRO Compensation Report

Read the full report here