Employers are offering creative perks to attract and retain today’s workers.
Plus all the HR resources you need to be more efficient and effective this fall!
Prepare for your exam with the guidance of a SHRM-certified instructor in Boston, Oct. 24-26.
Learn how to make the business case for diversity, October 25-27.
Communicate the value of the overall benefits program
Employers are looking to control benefit costs by asking workers to take on more responsibility for their coverage. There is conflicting evidence, however, as to whether this cost shifting is lowering employees' perception of the value of their benefits.
According to the 2014 Guardian Workplace Benefits Study, sponsored by the Guardian Life Insurance Co., the degree to which people value their workplace benefits has increased to an average score of 7.1 (based on a scale of 1 to 10), up from 6.8 in 2012.
Eighty percent of respondents obtained all health and disability insurance as well as retirement savings through their employer, and 79 percent said benefits are crucial for staying with a job.
“The 2014 study captures an interesting dynamic between the increased importance of workplace benefits for employees, the need for employers to better manage the costs, and the responsibilities associated with offering or accessing coverage—from employer communications to employee education," Phyllis Falotico, Guardian’s assistant vice president for group marketing, told SHRM Online.
Organizations are seeking opportunities to shift more costs and responsibilities to their employees at a time when these benefits are becoming more critical to the workers’ overall financial security and well-being, Falotico noted.
A little more than half of the employers surveyed believe they’ve been successful in preparing for a post-health-care-reform era of benefits, but only 22 percent consider themselves “well prepared” to discuss these changes with employees.
Amid uncertainty, many employers are also evaluating the advantages of outsourcing all or part of their benefits administration and enrollment functions. Increasingly, companies believe that outsourcing will be more cost-effective in this rapidly changing environment.
“The reality within the industry today is that employees are being asked to shoulder increasing responsibility for their benefits, so it’s extremely important they have a solid understanding of their options and personal relevance of the benefits offered,” Falotico said. “While the responsibility of benefits costs may be shifting, it’s still essential for companies to ensure that their employees have a clear understanding of which workplace benefits are best for their particular situation.”
A Precipitous Drop
Even though Guardian's findings reveal an uptick in how much employees value their benefits despite cost shifting, the latest Mercer Workplace Surveysuggests that the perceived value of workplace benefits among employees is eroding, driven by concerns about rising out-of-pocket health costs.
The percentage of workers under age 50 who say their benefits are “definitely worth it” in terms of what they pay out of pocket has dropped precipitously in just two years, from 45 percent to 30 percent, Mercer found.
Despite these concerns, participants still see benefits as critically important: 93 percent agree with the statement “My health benefits are as important as my salary,” and 86 percent disagree with the statement “My benefits don’t matter much to me.”
“Out-of-pocket expenses for employees are likely to continue to rise,” said Beth Umland, director of research for Mercer’s health and benefits business. “We’re seeing more cost shifting and rapid growth in high-deductible consumer-directed health plans as employers are asked to cover more employees under health reform. So it’s critical for sponsors to explicitly communicate the value of the overall benefits program they provide and consider offering educational resources and tools to help participants better manage their health care spending. Giving employees more choice can also help build perceived value.”
Stephen Miller, CEBS, is an online editor/manager for SHRM.
Related SHRM Articles:
You have successfully saved this page as a bookmark.
Please confirm that you want to proceed with deleting bookmark.
You have successfully removed bookmark.
Please log in as a SHRM member before saving bookmarks.
Your session has expired. Please log in again before saving bookmarks.
Please purchase a SHRM membership before saving bookmarks.
An error has occurred
Recommended for you
Join SHRM's exclusive peer-to-peer social network
SHRM’s HR Vendor Directory contains over 3,200 companies