The Biggest Trends We Will See in Discretionary Benefits In 2018
January 19, 2018 by Martina Markovska
With a tight job market, companies are becoming more and more flexible and accommodating to the needs of employees by offering a range of attractive discretionary benefits. What may have previously been considered an additional expense is now seen as a smart investment. As a result, many companies are offering discretionary benefits as a strategic manoeuvre to attract and retain talent, as well as to establish themselves as an employer of choice.
Discretionary benefits are employment benefits that are not mandated by law. They can include a range of employee benefits, such as health insurance, sick leave, maternity leave, vacation leave, pension plans, life insurance, and prescription drug insurance. It’s completely up to HR professionals to decide which company benefits will be available as part of their employee benefits scheme.
This year, it’s expected that discretionary benefits will continue to gain momentum and popularity among companies and employees. So let’s take a look at some of the biggest trends in discretionary benefits we can expect to see this year.
One of the biggest trends in discretionary benefits this year is the focus on wellness programs. A recent study reveals that individuals would rather choose a lower-paying job that had comprehensive health insurance than a higher-paying job that didn’t.
Although most companies already have some kind of wellness program inside their employee benefits package, HR professionals should nevertheless revise the current level of coverage in their wellness program. What does the wellness program cover? Does it include dental, vision and prescription drug insurance? Does it cover just the employee or their immediate family members, too? Once you revise your wellness program it’s time for a suitable update.
And it’s completely worth it. Wellness programs have numerous benefits that contribute to the ROI and success of an organization. Here are the main reasons you should make wellness programs your priority this year:
- Lower healthcare costs – Wellness programs promote healthy behaviors, mitigate health risks and help detect signs of chronic diseases. In turn, this sequence results in lower healthcare costs.
- Increased productivity – Focusing on employees’ health means an increase in productivity. Having access to wellness programs mitigate conditions associated with poor productivity, such as presenteeism.
- Reduced absenteeism – Better healthcare means employees will take fewer sick leaves. This will then influence a boost in productivity levels.
Financial Wellness Programs
Employees often find themselves victims of financial stress. Whether it’s poor financial planning, bad spending habits or debt, financial stress is a major problem. And it’s not just a problem for individuals, but for organizations as well. Major concerns outside of work can become a concern inside the office. It can result in low productivity, absenteeism, poor customer service and a decrease in overall company performance. Consequently, HR professionals will try to alleviate some of this financial stress by offering financial wellness programs as part of their discretionary benefits program.
The purpose of including financial wellness into the employee benefit scheme is to help employees cope with their difficulties outside of work. This type of support will have a considerable impact on companies. Employees will feel better about coming to work, will be more likely to develop a sense of company loyalty and will boost their productivity levels. Basically, employees will mirror the care the company shows them and return the favor by giving their full commitment and loyalty.
Personalized Discretionary Benefits
Another trend that we will be seeing more of this year is personalization. Age, demographics and social status is a major influence when it comes to employee benefits packages. Employees don’t want cookie-cutter employee benefits packages. They want to utilize a personalized benefit package that’ll satisfy their needs and simplify their lives. What may be just right for someone, might be completely useless to another. Research shows that more than two thirds of HR professional believe that flexible working benefits will increase in importance in the next few years.
Diverse needs call for diverse benefits packages. For example, employees with children may want to receive childcare assistance, while those without children have no need for this type of discretionary benefit. Instead they may want to receive physical wellness incentives to focus more on their physical health. Therefore, we will definitely be seeing an increase in personalized employee benefits.
Better Open Enrollment Communication
Companies will finally accept the need for effective open enrollment communication regarding employee benefits packages. This comes following the fact that many employees aren’t aware of their company’s employee benefits scheme. In fact, according to a recent report, only 14% of employees within an organization are “very knowledgeable” about of the company’s employee benefit scheme.
This is an instance of how poor communication can have a negative effect on both employees and organizations. Instead of employees using the discretionary benefits available to them, they end up going without them. This also means that valuable time was lost in preparing employee benefit schemes. As a result many professionals don’t take advantage of company benefits that they’re entitled to. To overcome poor open enrollment communication, HR professionals should create an effective internal marketing and communications strategy.
Here are some ways open enrollment communications can be improved:
- Electronic campaign – This includes email blasts, newsletters and instant messaging updates informing employees of the employee benefits scheme.
- Conference calls – Employees can participate in conference calls during open enrollment to learn more about discretionary benefits.
- Face-to-face open enrollment sessions – HR professionals can schedule face-to-face meetings with employees to discuss the company’s employee benefits scheme and individual benefits packages.
- Social media engagement – As part of the internal marketing and communications strategy, HR professionals should make the most of social media to post updates and keep employees informed about employee benefits.
- Combination of methods – For maximum communication regarding employee benefits packages, HR professionals should use a combination of methods to ensure employees are aware of the discretionary benefits available to them.
If a company wants to stay ahead in the game they should join the movement towards educating their employees about open enrollment and discretionary benefits.
By looking at the biggest trends in discretionary benefits this year, we can see a shift in the level of care given by HR professionals. Employee benefits packages will be more employee-oriented to ensure they have a quality work life. Additionally, there is a change in the approach taken by employers and HR departments. Rather than simply attracting and retaining talent, companies will work together with HR professionals to strategically engage and support employees inside and outside of work.
Be ahead of the curve by following some the biggest trends in discretionary benefits. Plan, organize and implement any changes to your employee benefits packages with the help of experienced HR professionals.
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