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2022 Advice and Reminders for Comp and Benefits Managers

Trends and developments to follow in the year ahead

A desk with a laptop and a cup of coffee.

As the new year gets underway, SHRM Online has collected the following predictions from experts on how compensation, benefits and workplace culture are likely to change.

Take Steps to Counter the Great Resignation

Employers facing worker shortages are now open to enacting certain changes, such as:

  • Marketing the company as a "Best Place to Work." With the rise in remote work, the competition is no longer just about the company next door, but also about the company across the country.
  • Adopting a total rewards strategy. This involves expanding benefits beyond traditional health, dental, vision, disability and life insurance plans.
  • Considering increased salaries if possible. Is your company paying competitively for the work it expects?
  • Relaxing policies as appropriate. Amazon, for instance, is no longer screening for marijuana during drug testing.
  • Being creative with work/life balance benefits. The pandemic showed that office employees can work virtually from anywhere in the country or the world and be just as productive as long as they have accommodations and flexibility.

    —Bobbi Kloss is the director of human capital management services for the Benefit Advisors Network, a national network of independent employee benefits brokerage and consulting companies.

    Expect Challenges Around DE&I and the Future of Work

    Many workforce trends that will continue into the new year have implications for diversity, equity and inclusion (DE&I) strategies and outcomes. Examples include the following:

    • Hybrid workplaces could lead to disparities. Having some employees working remotely and others performing their jobs onsite can create subtle inequities. Companies will need to be intentional about tracking promotions, pay scales and opportunities to ensure that remote employees are not treated less favorably.
    • The Great Resignation shows no signs of stopping. In 2021, we saw people leave their jobs in droves in search of more money, more flexibility and more happiness. In response, we'll see employers pressured to make changes such as offering increased wages, hiring incentives and competitive benefits to attract talent, and they'll also focus on internal mobility, reskilling and upskilling to retain existing employees.
    • Companies can no longer ignore mental health. The COVID-19 pandemic worsened workers' mental health and emotional well-being. To create an environment that supports mental health, companies can appoint a senior leader in charge of mental health initiatives, offer mental health benefits that are on par with physical health benefits, ensure easy access to resources without stigma and measure how well they're meeting employees' needs.
    • Parental leave will take center stage. The pandemic brought to light the challenges working parents and caregivers face. We'll continue to see discussions around parental leave as workers demand better policies that put families first.

      Mandy Price is CEO and co-founder of Kanarys, a technology company that provides organizations with tools to address DE&I challenges.

      Address Virtual Care and Health Equity Issues

      Employers will seek increased telehealth availability and improved mental health while working toward health equity—ensuring the same access and quality of health care to all employees, including those from historically disadvantaged groups. Among these trends:

      • Virtual health is here to stay, but integration with in-person care is key. Virtual health has a growing role in primary care and the management of chronic conditions. Harnessing its full value will mean helping patients to integrate care they received in person at a doctor's office or clinic with care they receive via a telehealth service, as these providers may not be sharing clinical data. It will also be important to create a level playing field with regard to how insurers reimburse care providers.
      • Virtual mental health services are expanding. The pandemic has exacerbated long-standing challenges pertaining to mental health and emotional well-being, including lack of locally available therapists and the stigma that often prevents people from seeking in-person care. Employers have responded by providing digital therapy, which can bridge access gaps for employees. Employers, however, must remain focused on the quality of these resources.
      • Increased health equity is a focus. Employers are seeking to achieve health equity by offering inclusive and affordable health benefits and well-being programs, using health provider networks that are representative of the population, and analyzing claims for signs of unequal treatment. The aim is to mitigate differences in health outcomes across the workforce, including among those in under-resourced or marginalized groups.

        Ellen Kelsay is president and CEO of Business Group on Health.

        Reminder: Expiring Benefits Plan Relief Provisions

        Under pandemic relief rules, employers can let participants in health care flexible spending accounts (FSAs) or dependent care FSAs carry over unused balances from a plan year ending in 2021 to a plan year ending in 2022, or extend to 12 months the grace period for spending unused FSA funds for plan years ending in 2021. Employers can choose to provide either or neither of these extensions.

        Other relief provisions ended at the close of 2021, even though the pandemic has not ended. Expired relief provisions include:

        • The amount that employees can reduce their salary to fund a dependent care FSA goes back to the statutory limit of $5,000 in 2022, down from $10,500, for single taxpayers and married couples filing jointly. It reverts back to $2,500 for a married person filing separately, down from $5,250.
        • Employees can no longer change their salary reduction elections to a health or dependent care FSA in the middle of the year unless the change in election is due to a change in status event such as marriage, divorce or new child; such midyear election changes were permitted in 2021.
        • If an employee leaves a job in 2022 without using all the dollars in a health FSA, the employee will have to forfeit that unused amount; in 2020 and 2021, employers could allow terminated employees to access those unused amounts for health expenses until the end of the plan year.
        • High-deductible health plans linked to health savings accounts (HSAs) will no longer be able to subsidize telehealth services before the deductible limit is met. In 2020 and 2021, insurance coverage that subsidized the cost of telehealth services pre-deductible did not prevent a worker from making HSA contributions.

          Despite these relief provisions ending as 2022 begins, it's important to show employees the value of continuing to participate in employer-sponsored FSA and HSA programs.

          William Sweetnam is the legislative and technical director at the Employers Council on Flexible Compensation.

          Related SHRM Article:

          As Work Changed in 2021, Employee Pay and Benefits Stepped Up, SHRM Online, December 2021


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