An employee benefits strategy to drive engagement and retention
by Marc CostantiniMr. Costantini is executive vice president of Commercial & Government Markets at The Guardian Life Insurance Company of America®. In this role, he is responsible for continuing the growth of Guardian’s group employee benefits and absence management business, including Group & Worksite, Avēsis, and ReedGroup. He is also a fellow of the Society of Actuaries, a member of the American Academy of Actuaries and a fellow of the Canadian Institute of Actuaries. Visit www.guardianlife.com
To call the current American labor market “challenging” for employers understates the unfortunate dark side of low unemployment and economic success – high employee turnover.
The current American job market clearly favors job seekers over employers. Like free agents, workers today hop from job to job with ease. The U.S. Department of Labor’s monthly jobs report showed the nation added 136,000 jobs this past September, and the unemployment rate hit the lowest rate since December 1969 at 3.5%, despite nearly 3.5 million Americans voluntarily quitting their jobs every month. Most notable is that the Department of Labor announced that September marked eighteen consecutive months of more U.S. job openings than job seekers.
High employee turnover can significantly and negatively impact the health of a business, both financially and emotionally. The inability to retain employees can lead to lost productivity, money and time.
Luckily, businesses can tackle the turnover problem. In recent years, employers have placed gre
ter importance on offering an expansive array of benefits that employees seek and demand. In fact, a recent Guardian Life report, What Employees Want, shows 76% of employers list attracting and retaining talent as a top benefits objective, up from 52% in 2012.1
Give Them What They Want
While competitive pay and good benefits have been shown to influence an employee’s decision to join and remain with a company, today’s employers must deliver a more targeted, personalized approach that caters to an increasingly diverse workforce. Guardian’s sixth annual workplace benefits study (2018) reveals 70% of employees strongly agree they are more likely to be loyal to a company that offers them employee benefits personalized to their needs.
This means employers must expand beyond core benefits and offer new ones that will lure job seekers. Guardian’s latest research identifies non-traditional benefits that today’s workforce wants and on which it places a high value: paid time off for caregiving, more health benefits and student debt relief.
Our findings show that 58% of employees prefer to work for an organization that offers paid time off (PTO) for parental bonding or to care for a sick or injured loved one. Today’s American worker wants flexible work arrangements and options that allow them to better balance their work and personal responsibilities.
Employer policies regarding paid time off for family and medical leave are not only popular and contribute to employee loyalty, but they can positively impact the well-being of workers and their families. Paid leave policies enable workers who cannot afford to take unpaid leave under the Family and Medical Leave Act (FMLA), or who work in states without mandated paid family and medical leave, to take the time needed for bonding with a newborn, adopted or foster child, or providing care for an ill spouse, child or parent.
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More than half (55%) of employees also said supplemental health insurance offerings, such as critical illness, accident insurance and hospital indemnity coverage, are a welcome addition to help pay for expenses not covered by their medical plans, as well as to expand care possibilities.
In recent years, core benefits offerings have become more complex for several reasons, including the economic climate, healthcare reform and the demand for more flexible, personalized employee-paid plans that can boost health and financial security. And with healthcare costs and major medical plan deductibles on the rise, most employees appreciate the extra protection supplemental health insurance products provide.
Also weighing heavily on the minds and pockets of many employees is student debt. Currently, 44.7 million Americans struggle with student loan debt that now totals $1.5 trillion shedding light on a crisis that is financially impacting American workers. The result is student loan repayment benefits are on the rise as one of the hottest new benefit trends that employees want.2 For employers seeking to attract and retain the younger generations of workers, 25% of employees want a student loan debt repayment benefit.
For the past two years, it has been the most asked about benefit at job fairs. The extreme debt has taken an enormous emotional toll on millions of working, college-educated adults who feel they will never make enough money to achieve their financial goals. It’s no surprise, nearly 7 in 10 millennials say a student loan repayment benefit would influence their job decision.
In response, forward-thinking companies can begin partnering with student loan refinancing companies or incorporating student loan repayment options into their benefits packages as a way to attract new talent and foster meaningful relationships with current employees to boost morale, retention and workplace value. In addition to addressing college debt, college tuition benefits could gain momentum as a way to help employees save for college. For example, Guardian’s college tuition benefit* is a rewards-based program offered through the employer.
Make It Easy On Them
Knowing what employees want is half the battle. Workplace satisfaction comes from more than just the benefits offered; it also includes the experience in how those benefits are communicated and how employees enroll.
Recent surveys indicate most employees do not fully understand the benefits employers offer them. The average score on Guardian’s 2019 Employee Benefits I.Q. Quiz is a 68%, or C- on a standard grading scale. Among millennials, scores were lowest, with 1 in 4 failing the quiz. Workforce knowledge continues to be limited about disability insurance and supplemental health plans, such as critical illness and hospital indemnity insurance.
Many working Americans continue to express interest in more personalized benefits communications and an enrollment process that better supports benefits decision-making. To provide what employees are seeking, employers can:
- Provide clear explanations for how benefits fit together and what each provides.
- Make benefits easier to understand by reducing or even removing jargon from materials.
- Access to digital tools like mobile apps, educational videos and professional consultation to answer specific benefit questions.
- Make the experience more personalized to each audience’s needs.
- Evaluate benefits technology platforms to help ease the enrollment process and allow for efficient benefits administration. There are emerging platforms using API (Application Program Interface) technology, like PlanSource Boost, that streamline the setup of an employer’s benefit plan selection, allow for real-time exchange of member-level enrollment data and automate the Evidence of Insurability decision process.
Understand their wants and needs
Few employees would call the annual benefits enrollment process “fun.” However, considering the lack of awareness surrounding current benefit offerings, improving the enrollment experience is another vital opportunity for employers to help their employees make important, informed decisions that could impact their immediate and long-term futures.
An improved experience will also help the employee/employer relationship through a shared understanding of each other’s needs and how those needs are being addressed. In other words, having a clear, simple understanding of what is being offered is a way to improve employee morale and job satisfaction.
Retaining employees for longer periods can have numerous benefits for an employer, including the time, effort and cost associated with finding and training the right people for the job. With this in mind — and with the high cost of employee turnover and the current competitive state of the labor market — it’s more important than ever for companies to provide comprehensive benefits packages and a personalized and easy-to-understand employee enrollment digital experience.
This includes having a better understanding of today’s diverse workforce, as well as an increased awareness and understanding of what benefits best align with employee needs and desires.◊
1. Unless otherwise noted, all information contained in this report is from “What Employees Want: Benefits that drive engagement and retention,” from the 6th Annual Workplace Benefits Study (2019).
2. “Report on the Economic Well-Being of U.S. Households in 2017”. The Federal Reserve website, updated September 2018.
*Unless otherwise noted, all information contained in this report is from “What Employees Want: Benefits that drive engagement and retention,” from the 6th Annual Workplace Benefits Study (2019).
*The Tuition Rewards program is provided by SAGE CTB, LLC. Guardian does not provide any services related to this program. SAGE CTB, LLC is not a subsidiary or an affiliate of Guardian. Guardian reserves the right to discontinue the College Tuition Benefit program at any time without notice. The College Tuition Benefit is not an insurance benefit and may not be available in all states.
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