Use of Legal Plans for Financial Matters Doubled in Tough Economy

Assistance through a group legal plan may encourage employees to take action before matters escalate

By SHRM Online staff Apr 9, 2012

From 2007 to 2011, the number of legal services requested by plan participants for debt and financial matters more than doubled, and requests for bankruptcy counsel increased nearly threefold, according to a white paper by benefits provider Hyatt Legal Plans, a MetLife company. The white paper, From the Actions and Words of Employees: How Group Legal Plans are Positively Impacting Physical and Financial Health draws on research and employee commentary to illustrate the impact of personal legal issues on employees and the workplace.

“Since employees’ preoccupation with personal legal issues may also impact workplace productivity, offering access to affordable legal assistance through a voluntary group legal plan can be a valued addition to an employer’s overall financial wellness program,” said Bill Brooks, CEO of Hyatt Legal Plans. “The research found that 61 percent of employees who accessed services in their group legal plan spent less time at work worrying about, and dealing with, their legal situation. They also took less time off from work to deal with their issue in contrast to employees who dealt with their situation on their own.”

According to the survey, conducted in 2011 among working Americans employed full time:

Employees who did not hire an attorney to help with their legal situation were nearly three times as likely to spend five to 10 hours at work dealing with their legal issue than those who hired an attorney through work.

50 percent of those who did not hire an attorney took time off work to deal with their legal issue, compared to only 30 percent of those who hired an attorney through work.

Expense Prevents Seeking Counsel

Not surprisingly, a big reason for not seeking legal services is concern about expense. The national survey found that 42 percent of those who did not hire an attorney said it was because attorneys are too expensive. Those who did not hire an attorney most often referred to the Internet, friends or family to help them address their legal matter.

"A legal plan would have put them directly in touch with a local, qualified attorney to personally assist them with their issue at an affordable monthly rate through payroll deduction. Having an attorney through a group legal plan would detract from guesswork and uncertainty associated with attempting to handle a legal situation without professional assistance," said Brooks.

Many group legal plans include fully covered attorney services for a wide range of personal legal matters for around $20 per month through payroll deduction. “Having affordable resources such as attorney assistance and representation through a group legal plan may encourage employees to take action sooner and address matters before they escalate,” Brooks noted. “As a voluntary benefit, it is affordable to many employees and a cost-effective way for employers to be able to expand their benefits portfolio to improve employee satisfaction.”

Although demand for certain legal services escalates during tough economic times, other services continue to have steady plan usage, according to Brooks, including adoption, guardianship, name changes, wills, trusts, deeds, tenant matters, juvenile court defense, traffic matters, consumer protection matters, immigration assistance, demand letters and consultations.

Related Articles:

Group Legal Plans: value for a Diverse Workforce, SHRM Online Benefits Discipline, October 2008

Call Your AttorneyLegal Services as an Employee Benefit,SHRM Online Benefits Discipline, January 2005

Survey: Employee Legal Woes in Workplace, SHRM Online Benefits Discipline, October 2008

Quick Links:

SHRM Online Benefits Discipline

SHRM Online ​Workplace Flexibility Resource Page

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