Solving the Employee Benefits Puzzle

How to Design a Package that Retains Workers

Abstract: Employers are retooling their benefits packages to attract, motivate and retain top performers. Younger employees expect offerings that go beyond basic needs for health care coverage and retirement planning. Workplace surveys can help companies assemble tailor-made packages that balance worker satisfaction with budget realities.

When Grand Pacific Resorts launched a mental health care benefits program in January of this year, the move reflected a growing industry-wide concern for the psychological welfare of the workforce. “The fast-paced nature of the hospitality industry can leave employees feeling really anxious, stressed, and burned out,” said Abby Escalante, the company’s Director of Associate Relations. “We have a responsibility as an employer to protect the physical and mental well-being of our people.”

But the Grand Pacific move also illustrates a larger trend: Employers are retooling their benefits packages to reflect the changing needs of a new workforce. “It used to be that health insurance and some retirement savings vehicle such as a 401K plan were the only things required in a benefits package,” said Lauren Winans, Chief Executive Officer and Principal Consultant at Next Level Benefits. “Times have changed. Employees are looking for benefits that help them balance their lives and prepare for the future.”

Among the new offerings are childcare subsidies, caregiver support, educational opportunities, and flexible time off. “The biggest trend I have seen recently is toward offering of paid parental leave,” said Mark Stratton Berry, Senior Human Resource Specialist at Insperity. The dominance of two-income households, of course, is the driving force. (For a comprehensive list of popular benefits, see the sidebar, “The Changing World of Employee Benefits.”)

Among the most commonly cited rapidly rising benefits is mental health coverage. While the primary reason is a concern for human welfare, there’s also a bottom-line principle: Employers are coming to the realization that workplace stress and anxiety can be costly.

“When a team member is struggling with their mental health, it naturally impacts their ability to be fully engaged or present at work,” said Escalante. “On average, we have found that an employee will miss around 12 days of work each calendar year due to these struggles, which not only affects them personally but is costly for the company. By prioritizing the mental health of our team members, we’re not only investing in their well-being, but also fostering a culture of engagement and retention.”

Treading carefully

Good intentions are one thing. Successful implementations are another. Employers need to carefully design such programs to deal effectively with modern realities.

“Mental health support can be tricky,” said Winans. “Many employers believe they are offering mental health benefits through their insurance carriers, but many employees are running into the problem that there’s not enough counselors, therapists, psychologists, and psychiatrists to help all of the people that are in need.”

In response, noted Winans, many companies are utilizing new technologies in the form of free counseling apps, or memberships in private services that provide help with meditation or with connecting to counselors at convenient times.

And that’s exactly what happened at Grand Pacific. “Like other companies, we have an Employee Assistance Program (EAP) as part of our benefits package,” said Escalante. “But in many cases associates have told us that EAP was taking a very long time to help, if they even received a response from them. And I knew we needed our team members to get the help they need and deserve ASAP.”

An EAP will typically provide employees with lists of nearby doctors, therapists and psychologists, leaving the employee to track down the right provider. That task can be nerve-wracking in itself, only adding to the employee’s mental stress.

The solution, many times, is a third-party provider. “I started researching different companies and liked what Care Solace had to offer,” said Escalante. “And the people who work there seem to really care as well.” The company’s new service proactively matches employees with appropriate providers. This one-on-one dynamic has already saved the company’s employees over 1,000 phone calls, emails and texts to find care, noted Escalante. “They will work with whatever insurance company the employee has and will even find free or low-cost services for employees with no insurance. They also follow-up to ensure that the individual connects with a therapist who is helpful and fits their needs.”

The right deal

With all of these new benefits in the marketplace, which ones will make the best fit at any given company? While a carefully curated package can attract, motivate and help retain the best employees, the fact is that benefits can be costly. No employer wants to waste money on services people will not utilize.

To find out which benefits will pull their weight, consultants advise involving the end user. “The most common mistake is not asking employees what their needs are,” said Winans. “It’s too easy to fail to put in the necessary strategic effort, and then end up at the end of the year having to scramble to figure out what the next year’s benefits are going to look like. That can mean making decisions based on anecdotal information that might not serve them well.”

Winans suggests posing a question like: “Is what we’re offering meeting your needs? If it’s not, we want to hear about that so that we can take that information and do some further research so we can invest dollars that make our benefits program more meaningful to you. That will make it worth your while to work here, and also make it worth our while from a dollars and cents perspective. As an employer, we don’t want to spend money on benefits you’re not going to use.”

Once every two or three years is a good time frame for doing these employee surveys. And once survey results are in, take action. “Be sure to acknowledge the employees’ input,” said Berry. “Be transparent. Message the employees about what areas the survey reveals the company can improve, and what steps you will be taking as a result. Employees need to feel that they have a voice, and that their voice has been heard and acknowledged.”

Related: Grand Pacific Resorts’ Plan for Continuous Improvement

While surveys are the most effective channel to ferret out employee needs, employers can also do a little productive sleuthing. “It’s fair and realistic to gauge what your competitors in your market may be offering,” said Berry. “That ties into recruiting and retention, as you want to make sure you’ve got what it takes to satisfy the best talent.”

Bonus tip: Another way to obtain feedback is to arrange for small work groups of employees who have an open dialog about desired benefits.

Unique needs

Given that the workforce makeup will differ among employers, winning benefits recipes will be equally diverse. “Benefits is not a one-size-fits-all environment,” said Suzanne Haslam, Senior Vice President at Woodruff Sawyer. “It’s important for employers to do an inventory of their demographics and then customize their benefits plans to the needs of their staff.”

Haslam gives some examples:

• Younger individuals.
  Consider family-forming coverage such as support for fertility, adoption, and surrogacy. Once these individuals have families, expand services to include lactation consulting, return to work support, and childcare services.
• College graduates.
  Potential benefits include debt consolidation services and financial wellness and home buying support.
• Middle aged people.
  Do they need assistance in planning for their child’s education? Is someone in a sandwich generation caring for both kids and parents? Would elder care services be appropriate?
• Older people.
  Women may be looking for menopause support services. Individuals approaching retirement may appreciate financial wellness and Medicare planning support services.

Keeping it real

While employers need to work out the best mix of benefits for their workers, the fact remains that health and medical coverage will always remain the baseline offerings. “Specific benefits tend to be consistently valued across a large spectrum of employees due to their broad applicability and impact to quality of life,” said Alicia Scott-Wears, Director of Total Rewards Content Strategy at consulting firm WorldatWork. “Comprehensive and affordable health insurance coverage, retirement saving plans, and paid time off lead among these high-valued benefits and for the most part are considered basic requirements.”

But employers often run up against a budget reality: Health coverage is expensive, and the dollars required to support physical wellness can hamper the drive to extend benefits in other areas. “It’s hard to balance the need for benefits against limited resources,” said Winans. “The cost of healthcare goes up every year, and tends to eat up the rest of the benefits budget. That makes it harder to offer a competitive retirement plan contribution rate, or a supplemental mental health program, or even give people more time off.”

Many times, said Winans, the solution to this conundrum involves identifying the most egregious benefits gaps, securing the most impactful programs available, then just trying to allocate dollars in a way that makes the most sense. “It’s really like a game of chess,” said Winans. “Employers need to think strategically about how to invest dollars in the right vehicles.”

About the author. Phillip M. Perry is an award-winning freelance writer based in New York City. His byline has appeared over 3,000 times in the nation’s business press. He can be reached at https://www.linkedin.com/in/phillipmperry/