Employee benefits are an essential tool in attracting and maintaining a motivated and loyal work force. If the employees aren’t fully aware of all the benefits available to them, much of the time and effort employers spend to select those benefits is negated.
“People can’t put a value on what they don’t know about,” says Naomi Hall, regional director of training for Gallagher Benefit Services Inc., Houston. “Effective communications include getting the right information out at the right time for the right audience. The more employees know about the benefits that the company is paying for, the better chance there is that they will appreciate what they have.”
Smart Business talked with Hall for her insight into effective employee benefits communication.
Why is communication of benefits so important?
First, there are the legal requirements. Most employers are familiar with the communications mandated by COBRA, HIPAA, and other federal and state laws, but just as important is keeping employees regularly informed about what the benefits mean to them and at what cost. Too often, employers will simply hand out a ‘benefits booklet’ once a year when the new plan takes affect. Studies show that about half of employees just skim those booklets. Communications-savvy companies are finding a variety of ways to provide more timely information targeted to the employees’ needs.
Strategic communications are so important. It takes forethought and planning, but can pay big dividends in employee knowledge and morale.
What benefits information should be provided on a regular basis?
The majority of employees underestimate the total cost of their benefits package and overestimate their cost share. Employers should share information about the total cost of benefits with employees. It’s often called ‘the hidden paycheck,’ the amount employers pay for benefits, yet employees don’t know about it. That can be 20 percent to 40 percent of their total compensation. Also, reminders about how to most effectively access and use benefits are essential. For instance if you have a wellness plan that pays for a free annual checkup, remind employees about it. Healthy employees are more productive. You can also communicate various ways that employees can better maintain a healthful lifestyle.
What are some of the ways companies can communicate this information?
It depends on the corporate culture and what resources the company has available. If employees regularly have access to the Internet, e-mails or postings on the company intranet can be effective. Some companies are setting up specific Web sites just for benefits. Employees can go to that site 24-7 to obtain benefits information and request updates to addresses or even coverage levels. Web casts are also effective. A year-round communications campaign is very important. If considering print communications, postcards could be mailed. Break-room posters are visible reminders of the benefits package. Helpful wellness tips in the pay envelope can be effective. If you need help in getting started, your benefits vendor should be able to supply some ideas or even printed materials that you could use.
Employers don’t need to spend a lot of time or money, but the more they do communicate, the more advantages they are going to receive from the benefits provided. Some companies use a specific font or logo to communicate benefits information. Any time employees see that font or logo in company communications they know the item is addressing benefits and they are more likely to review it.
What do you mean when you say the right time?
The right time certainly includes the open-enrollment period. Be sure to get the information out at least a month ahead of the deadline. Some larger companies formally survey employees from time to time to get their feedback on effective benefits programs. If you are doing this, be sure to get the survey information out six to eight months before renewal so that you have time to thoroughly review the input as you are making decisions. These surveys can be done online, through one-on-one visits or focus groups. This information can help determine what is really important to your work force.
What do you mean by the right audience?
For example, if you have a primarily younger staff, those people are probably going to be more interested in child-care programs than retirement plans. By communicating the availability of nurse hot lines through the medical plan or possible federal tax breaks on child-care expenses by using a flexible spending account, you can target this part of your work force so that the employees better value the benefits package provided to them.
NAOMI HALL, CEBS, is regional director of training in the Gallagher Benefit Services Inc. section of Arthur J. Gallagher & Co. in Houston. Reach her at Naomi_Hall@AJG.com or (713) 358-5898.