Today, employers face many challenges when managing employee benefits programs.
With premiums ever-rising, employers must continually balance cost control measures with being able to provide a robust employee benefits package that will help retain and attract top talent, says Keith Kartman, client advisor with JRG Advisors, the management arm of ChamberChoice.
“To ensure that you are providing a benefits package that is both competitive and economical, you need to know how your offerings compare to others in your industry,” says Kartman.
Benchmarking is a practical and proven method that enables an employer to measure its current employee benefit offerings against competitors within the same market. As employee populations are becoming increasingly diverse, companies must meet the various needs of employees from multiple generations and different stages of life.
And with so many variables and choices, how do employers know they are hitting the mark?
Smart Business spoke with Kartman about how to benchmark your benefits program to ensure that it is competitive and economical.
How can benchmarking benefit employers?
Benchmark data provides valuable information and input to employers looking to evaluate their benefits package and compare it with others in the marketplace. In preparation for — and as a result of —health care reform, many suggest that the data that benchmarking can provide is crucial today, more than ever.
New regulations and provisions require significant changes to benefit plans and, in many cases, result in employers having to make difficult decisions. Knowing how other employers are approaching these issues can be extremely helpful in shaping your benefit program in this new health care landscape.
Employers will be responsible for implementing many new rules over the next few years and absorbing the costs associated with those rules, which, for most employers, will include cutting or shifting costs elsewhere. Knowing how other employers plan to address these benefit decisions can be advantageous, as these decisions could mean the difference between maintaining a competitive benefits package to attract the best and brightest and declining ability to recruit and retain quality employees.
Careful strategic planning includes ongoing evaluation of your organization to ensure that a comprehensive and competitive benefit package is offered to employees.
What are some recent trends in employee benefits offerings?
Offering a benefits package that balances cost and value, particularly in this uncertain economic and legislative time, is a perennial challenge. The results from a recent Society for Human Resource Management survey reflect this complex atmosphere.
One trend that is becoming more common among employers is that they are offering health care premium discounts to those employees who take a health risk assessment, who do not use tobacco products and/or who participate in wellness programs. The goal is to keep healthy employees healthy, while encouraging high-risk employees to change those lifestyle habits that can potentially have a negative impact on their health.
Properly managing and treating high-risk conditions such as high blood pressure, heart disease, diabetes and asthma can improve the health of your work force and help alleviate worsened health conditions and concerns in the long run.
What other trends are occurring in the workplace?
Another common trend is the replacement of traditional vacation, sick or holiday benefits with paid time off plans. Under a PTO plan, an employer creates a bank of hours or days that employees can draw from for various reasons, including taking a vacation, taking care of a sick child or an elderly parent, going to a doctor’s appointment or needing a personal day off from work for any reason.
Instead of vacation and sick days being itemized by the employer for a specific purpose, the employee uses the days or hours at his or her discretion.
PTO plans generally work best in an environment that is already flexible in nature and is open to modified work schedules, as PTO promotes a work/life balance by allowing employees to determine when they should take time off and what they should use it for. Flexible working policies such as job sharing and “flex” time have become an increasingly popular trend among employers.
Review your benefits program regularly, using benchmark data and employee surveys to evaluate and solicit feedback. Regardless of the industry your company is in, the current business environment is challenging.
Benchmarking will provide a better understanding of the key issues that are affecting a company’s performance through collaborating, comparing and analyzing data. The results will enable the organization to develop a strategic plan to address the issues highlighted within the benchmark report.
Keith Kartman is a client advisor with JRG Advisors, the management arm of ChamberChoice. Reach him at (412) 456-7010 or firstname.lastname@example.org.
Insights Employee Benefits is brought to you by ChamberChoice