In The Worksite

The State of Employee Benefits

What they value, what satisfies them; Perspective on the burden of healthcare

Excerpted from the employee Benefit Research Institute (EBRI) special report by by Paul Fronstin and Greenwald Associates’ Lisa Greenwald. Read the entire study here.

Introduction
Over the last 20 years, the Employee Benefit Research Institute (EBRI) and Greenwald & Associates have surveyed
employees to understand what types of benefits they value; how satisfied they are with those benefits; and their
perspectives on health benefits, health care, and the future of employee benefits.

Here are recent findings from the 2017 EBRI/Greenwald & Associates Health and Voluntary Workplace Benefits Survey (WBS). It highlights changes in employee viewpoints over time, especially changes related to valuation of benefits.

Coverage: What Benefits Do Employees Have Today?

Employees receive a wide variety of benefits from their workplace, both employer-sponsored as well as voluntary
benefits. We can see that the percentage of employees indicating they receive specific benefits such as health
insurance, dental insurance and retirement savings from their employer has increased over time. This increase in
offerings is generally consistent across most benefits, except for traditional pensions or defined benefit plans, as well as
short-term and long-term disability.

Recently, there has been much interest in employer-sponsored paid leave policies across the United States, both in
terms of sick leave and family leave policies. In 2017, 84 percent of employees say they receive paid vacation time and
71 percent say they receive paid sick leave. In addition, 45 percent of employees state their company offers paid maternity leave. In terms of paternity leave, a relatively new employee benefit, 26 percent of employees indicate their
employer has a paid paternity leave policy.

In addition to traditional benefits, a small percentage of employees access voluntary benefits (13 percent). As in past
years, employees say they purchase this coverage because it is less costly than what they can purchase on their own
(51 percent), they like the ease of payroll deductions (46 percent) and they want to protect against financial loss (39
percent).

Interestingly, employees with high-deductible health plans (HDHPs) are slightly more likely to have voluntary benefits
(18 percent versus 13 percent for non-HDHP participants). When asked why they choose to purchase voluntary
benefits, HDHP participants are more likely to note cost and a desire to protect against income loss or unexpected
expenses than non-HDHP participants.

Knowledge: How Well Do Employees Understand Their Benefits?

Employee knowledge of their benefits varies based on the type of benefit. We see that just over one-half (52
percent) of employees say they understand their health benefits very or extremely well. When asked about non-health
benefits, that number drops slightly, with only 43 percent indicating they understand these benefits extremely or very
well.

Some of this limited understanding of benefits may come from the lack–or perceived lack–of benefit educational
opportunities that employees are receiving from their employer. Nearly one-third (31 percent) of employees indicate
that their employer or benefits company provides no education or advice on benefits. Only 39 percent state that their
employer provides education on how health insurance works, 24 percent say that their employer provides education on
how a health savings account works, and 28 percent confirm that their employer offers education on how to invest
money in the retirement plan.

This lack of education and understanding may explain the decline in confidence employees express in making a benefit decision. In 2017, nearly 60 percent of employees say they are extremely or very confident in their ability to make a benefit decision. That is down from 73 percent in 2015. In addition, many employees say they would seek guidance in making decisions if given the chance. When presented with a situation where an employer provides access to a benefits advisor at no cost, 55 percent say they are very or extremely likely to consult that advisor.

Importance of Benefits: Satisfaction and Valuation

Nonetheless, employees are generally satisfied with their current benefits package. Nearly one-half of employees (48
percent) indicate they are very or extremely satisfied with their benefits, another 36 percent are somewhat satisfied. The proportion that is not at all satisfied is at a three-year low, at 6 percent.

In addition, the study finds that employee satisfaction with benefits relates to overall job satisfaction. We can see how
employees who are extremely or very satisfied with their benefits are more likely to say they are extremely/very
satisfied with their job. Similarly, those who are extremely/very satisfied with their benefits are more likely to say
employee morale at the workplace is excellent or very good.

Although employees are satisfied with benefits, there is the overarching question of how valuable benefits are in
relation to wages. Employees responded to two questions regarding the trade-off between wages and benefits. In the
first instance, they must choose between a wage increase next year versus an increase in their work-life balance
benefits, such as paid time off or telecommuting. Forty-four percent say they would give up a wage increase for
increased work-life balance benefits.

In the second trade-off scenario, employees must rate their satisfaction with health benefits as it relates to higher/lower wages. Sixty-three percent indicate satisfaction with the health benefits they receive right now, while 17 percent say they would rather have more health benefits and lower wages. Another 20 percent say they would prefer fewer health benefits and higher wages.

Read the entire study here.