There are many reasons why employee retention is one of the
most important considerations for your organization. Among these reasons, which
include employee satisfaction and team morale, the biggest reason—or at least
the easiest to measure—is cost.
And these costs also include the knowledge and experience
that an employee gained while at the company; a loss that will turn into a several
month-long learning curve for whoever replaces them.
Other reasons that employee retention should be carefully
considered are that the organization’s performance and reputation could suffer
with a lot of turnover, and that competition to hang on to top talent is
heating up in a country with the lowest unemployment rate in decades.
So how many people are actually leaving their jobs, and why?
What are the turnover costs for companies? And what can you do to revamp your
retention efforts?
Here’s what you need to know about why employee retention is
your best weapon in the war for talent.
Employee
retention stats
A BambooHR onboarding survey, which surveyed over 1,000 U.S.
employees, showed that 31%
of workers have left a job within the first
six months, and 68% of those workers have left within three. And data from the
Bureau of Labor Statistics (BLS) shows that since January 2019, every month
around 3.5
million employees have left their jobs voluntary. BLS
data from 2018 showed workers had been with their current employer for an average of
4.2 years.
The BLS also reported that workers in the baby boom
generation were found to hold an average of just under 12 jobs throughout his or her
lifetime, between ages 18 and 50. However, nearly half of the 12
jobs were held between ages 18 and 24. This means that younger workers are more
likely to shift more often, and so retention strategies should put emphasis on
what would appeal to this younger population.
Why
do employees leave?
It’s no surprise, really, that modern workers are hard to
retain. It’s easier now than it’s ever been to research a new company or
refresh a job board each and every day. With the endless resource that is the
Internet, workers are learning more about what’s fair and what isn’t, what they
could be getting paid versus what they are making.
But, the reason for the two-weeks’ notice has to stem from
something specific and not so broad as “I wanted something better.” So what
drives employees to leave?
The BambooHR survey mentioned above also reported the top
three reasons that surveyed employees left their positions within the first six
months:
They were no longer interested in
the work (28%)
Their jobs were not what they had
expected in the interview (26%)
They didn’t like their boss (23%)
This feedback shows that an important part of a new job is
transparency: if the work was nothing like what was described, employees aren’t
going to feel great about that. If they deal with a rude manager, that’s
another red flag. And when it’s only been a few months, they may feel less
inclined to stick it out—they are less attached or invested in the company at
this point than they would be years in.
As SHRM points out, other reasons that employees leave are because they found a better, more competitive alternative (perhaps a company that provides more benefits or higher salaries); they had a “predetermined plan” to quit because of life circumstances, such as going to get a degree or having a family; or they had a frustrating experience that led them to act on impulse. An example of the latter could be that they didn’t receive a promotion or raise when they thought they deserved it.
In addition, a survey from America’s Health Insurance Plan (AHIP) showed that 56% of respondents said health coverage was a key factor in whether or not they stayed at their current job. According to a SHRM survey, 92% of employees said that benefits remain important to their job satisfaction, and that 29% of employees cited their benefits package as one of the top reasons to look for another position within the next year.
The cost of turnover
The average cost per hire is over $4,000, according to a study from the SHRM, and it takes 42 days on average to fill a given position. Whether or not that number would be much higher or lower for your company, there’s no arguing that costs are substantial. In addition to these financial setbacks, there’s no one in the role doing the work, putting strain on your other employees.
Also keep
in mind that those covering the work while a position is being filled may
expect to be compensated for the extra work, adding to the costs even more. So
needless to say, turnover is not only frustrating, reputation-hurting, and
time-consuming, it’s also expensive.
How to revamp your employee
retention strategy
To win the
war for talent that’s currently going on in the U.S., it’s time to revamp your
retention strategy. Based on the common reasons people leave their jobs above,
consider these methods:
1. Clearly communicate job duties
and expectations
As already
mentioned, it can be upsetting or surprising to a new hire if the duties
discussed in the interview were not accurate to the job they suddenly find
themselves in. This is why it’s not always enough for an HR rep to do the
interview and why a manager or colleague who will have similar duties should be
engaged in the candidate-seeking process.
2. Update your benefits package
Because workers hold health and other benefits as a top priority in their decision to stay at their jobs, 85% of HR professionals say that they use benefits as a strategic tool to positively impact recruitment and retention, according to an SHRM benefits survey. For example, new trends include updates to parental benefits, such as maternity and paternity leave and adoption leave.
But
another part of updating your employee benefits is about work-life balance.
Modern employees look for jobs with flexibility offerings, such as working from
home or different working hours. These considerations are especially important
when catering to the younger generations, who value workplace culture and
flexibility.
According
to the Deloitte Global Millennial Survey
2019, half of
millennials surveyed said that they would consider working in the gig economy.
This lifestyle appealed to them because of the chance to earn more money (58%),
to work their own hours (41%) or to achieve better work/life balance (37%).
3. Encourage position transfers
within the company
Another
smart move to better retain and satisfy employees is to discuss their end goals
and their satisfaction in their current roles, and encourage them to look into
other departments if they’re not happy. Some companies are implementing this
idea into their policies and procedures, so employees can easily look at their
handbook and find out if this is an option.
4. Talk about pay equality and
diversity
Pay
equality and diversity are two hot topics in today’s workplace culture. Young
employees want to know that they’re being compensated for their hard work and
dedication, and it will be easy for them to tell if decisions like wage range
is based on discriminatory factors.
If this
hasn’t been a focus yet for your company, start by offering trainings or
seminars where employees can learn or share. Express your commitment to these
issues so that employees know you’re thinking about it.
5. Ask for feedback
Another
tried-and-true way to get inside the heads of your employees is to simply ask
them. Don’t try to guess how happy they are or how satisfied they are with
their work or department. Implement employee surveys that are anonymous so they
feel comfortable sharing. Hold discussions where employees can provide their
opinions, thoughts, and feelings about the company and what could be improved.
It also
can’t hurt to introduce new perks in the office, like a Friday lunchtime game
or regular outings after work. These opportunities for interaction can help
leaders become aware of issues or successes.
Key takeaways
Retention
is key with the current dips in the unemployment rate, which are only getting
lower. You need to create a retention plan that addresses real concerns that
your employees are having.
Remember
to:
Clearly
communicate expectations during interviews and throughout the candidate-seeking
process.
Update
your benefits package (including work-life balance and flexibility benefits)
regularly, based on what your workforce cares about.
Encourage
position transfers within the company.
Discuss
and address pay equality and diversity concerns that arise all the time in
modern workplaces.
Involve
employees in decision-making so that you can take their feedback into account.
These strategies will help you to stand out from competitors and retain quality talent. Make sure you give these considerations due care, and your overall workplace environment will improve (not to mention you’ll save on the high costs of filling positions that experience turnover regularly).
Let’s face it: it’s hard to replace great
executives in the growing business and startup worlds. No one wants to struggle
to constantly fill the same positions over and over again. It’s much better to
find great talent and keep it for a long time. However, given the competitive
market and the high demand, it’s hard to accomplish that in a sustainable,
timely manner.
What can employers, boards, stockholders, and
other invested parties do to reward and pay top executives to integrate them
more into the company and to have them stay with companies for the long term?
The answer is much trickier than most people would like to believe. It’s not as
simple as hiring high-performers in the first place, paying people more, or
even profit sharing. These are many different tools to help structure executive
compensation, but they are not the answer to your problem.
That answer is best discovered by a careful
evaluation of several factors. And the three main categories can be summed up
as follows.
Understanding the power and
limitations of money as a motivator
Assessing what your business can
and can’t do to boost executive compensation
Approaching executive compensation
as part of a multi-layered plan to reward real results
Money as a Motivator
The data shows that money does not always work as a motivator. For
people working low-paid jobs, money is definitely a motivator. They have bills
that need to be paid and a roof that they need to keep over their heads. But what
about for people building a career that have a track record as a high performer?
There is a similar need, but it may not be as urgent. In fact, if it is urgent,
those people will look elsewhere for other options.
The true difference between how much money
motivates low-wage workers and your executives should be that your executives
are (at least in theory) invested in your company.
Now that the theory is out of the way, the fact remains that money is still a force to be reckoned with at any stage of a great career. Money is the primary way most people meet their day-to-day needs and wants. If those are not met, no amount of extra perks or positive reinforcement will keep top talent at your company for the long term.
A great place to start when you are assessing
your executive compensation strategies is what the current executive salary for
the positions in question stand at today. This step is particularly important
for small businesses and startups. Larger companies may have resources and
certainly a larger network on which to draw this information from. They also
tend to factor salaried positions sooner simply because they have to deal with
it more.
Once you know how your baseline salary
compares to the competition, you can make a more informed decision about how to
proceed. Some ideas include but are not limited to:
Traditional bonuses
Traditional pay raises
Milestone bonuses
Gain sharing
Ad-hoc rewards/spot bonuses
And other forms of non-monetary
reward
These are all viable options depending on your company’s or startup’s situation.
However, they don’t mean much on their own without an understanding of what
your executives actually want and what your business can offer. Let’s take a
look.
Assessing
the State Of Your Business
At this stage, it may be helpful to compare
structuring your executive compensation plans to building a shed. Above, the
different materials that your plan can use have been laid out and the basic
purpose has been explained. But before a solid plan (or shed) can be
structured, you need to know what tools you are working with and not just the
materials you will use.
Two different situations must be treated in
this section. The first is when a company is beginning the process of bringing
on their first executive and arranging how he or she will be paid. The second
deals with revamping or reforming existing executive compensation plans.
Building Your Plan From the
Ground Up
Many successful small businesses and startups
find themselves faced with the challenge of hiring and paying executive leadership
at a time when they may not be ready for it. Some simple guidelines to keep in
mind include:
What the company can and can’t
afford
General expectations from your new
employee and from the company
How to tie the success of the
company to the success of your executive(s)
Simply put, if the money isn’t there at the
moment, it’s not there and it can’t be used. The expectations of your new
employee should be addressed in order to prevent miscommunication and
dissatisfaction. FInally, when the success of the company directly impacts the
success of your executive(s), they will be more motivated both for the sake of
the company and for the sake of their careers.
Restructuring Existing Plans
The other situation a small business in
particular may find themselves in is restructuring their existing methods in
order to bring the business to new heights or out of recent slumps. In this
case:
And discover how to tie the
success of the company to the success of your executive(s)
While most of the same points apply in this
situation as in the first, one particular point deserves a mention. Existing
structures should be torn down at certain points, inconvenient as it may be for
the rest of the company. This is especially true when the current situation has
not contributed to the growth of the company.
In Either Case
Assessing what your business can and can’t
offer should happen on a regular basis, regardless. When it comes to things
such as salaries, bonuses and compensation plans in general, those numbers are
very informative and valuable. For significant changes, a clear understanding
of where your business is at and where you want to go is priceless.
Creating Your Executive
Compensation Plan
With the groundwork in place, creating your
executive compensation plan should be a much easier process. Given the fact
that each situation by nature is fairly different, it’s hard to say
specifically how you should move forward from this point on.
However, the basics of a compensation plan are
the same no matter what:
Base salary
Bonuses of all sorts
Benefits
Long-term incentives
And perquisites
When Increasing the Money is Not
an Option
Compensation is not always about increasing
bonuses or salaries. Consider alternative ways of rewarding results, such as
additional vacation days under the same salary or flexible working hours when
appropriate. With a little extra effort, these options can be built into your
plan at a very small additional cost to your company.
Key Takeaways
The top executive talent out there has options
and they aren’t afraid of using them to their own advantage. When small
companies and startups can collaborate with their executives and reward real
results, it’s beneficial to everyone.
Whether you are part of a small business or a
rapidly-expanding startup, the basics of structuring your executive
compensation plan remain the same:
Money motivates people to an extent,
especially when it meets their needs. When it unexpectedly goes above and
beyond, it can be extremely motivating.
Your overall strategy should be
based on the state of your business, not on “what people say” or other outside
statistics. You know best what you can give and should communicate that to your
executives.
Real results should be rewarded in
a way that’s directly tied to the success of the business.
A unique executive compensation plan built on
these three points is a great start to success.
In conclusion, structuring your executive compensation plan to reward and promote results is a fundamental cornerstone of successful small businesses or startups. And when that is accomplished, it creates a firm foundation for your business’ growth.
An effective employee benefits broker is an extremely useful
ally in your HR efforts. Employees fuel business growth and success, so it’s
important for growing businesses to take care of their employees’ needs in
order to attract, retain, and engage the best possible talent. Employee
benefits are not just one of your largest expenses, they are also one of your
biggest tools in maximizing the human potential of your business. And benefits
brokers can bring much-needed experience, expertise, and connections to your
efforts to craft and maintain an effective employment brand.
However, not all benefits brokers or insurance brokers are
created equal and many effective collaborations can become neglected over time.
So how can you tell if your benefits broker is still the right partner for your
business or if you need to start taking them to task or finding an alternative?
Let’s walk through five questions that will help you clarify matters:
Is your employee benefits broker maximizing impact
as well as minimizing cost?
Are they reviewing and updating your benefits?
Does your benefits broker operate on the employee
level?
Is your broker streamlining enrollment?
Do they offer the latest technology?
Is Your Employee Benefits
Broker Maximizing Impact as Well as Minimizing Cost?
A good employee benefits broker will not only minimize your
benefits expenses but also make sure that the money that you do spend is well
spent. While brokers can reduce your costs significantly, benefits remain
25-40% of most companies’ payroll. Instead of treating this expense as a
necessary evil, an effective benefits broker will help you maximize your
return-on-investment.
Benefits brokers can reduce your benefits expenses by
negotiating better rates with carriers and providers as well as helping you
identify waste and develop more effective processes. For instance, they can cut
down on your prescription drug costs by implementing a telemedicine solution, exploring
level or self-funding options, or creating a custom mix of plan designs. And
they can save on overall healthcare expenses by working with you to develop an
effective tiered insurance structure that allows employees to opt into low-cost
plans or comprehensive plans at their own expense. If your broker is working
hard to reduce your costs, then that is a very good sign.
But, as we’ve said, minimizing costs is only part of the
picture. The best benefits brokers will also serve as employee benefits
consultants and advise you on how to strategically invest in your employee
benefits. It is just as important for your benefits to have the greatest
possible impact for your employees for the given cost as it is to keep that
cost in control. So, a good broker won’t just talk about your bottom line, they
will also keep the focus on employee health, wellbeing, and happiness.
And there’s plenty of reason to maximize your impact beyond
wanting the best for your employees. According to Aflac surveys, 80% of employees believe that
their benefits package influences their engagement in their jobs. Plus, most
employees surveyed said they were likely to accept a job with lower
compensation and better benefits. So, benefits are crucial to any efforts to
attract top talent as well as maximize employee productivity and retention.
Are They Reviewing and
Updating Your Benefits?
The best employee benefits brokers don’t just help you craft a
benefits package and then call it a day. Instead, they serve as employee
benefits advisors or benefits consultants, guiding you through your employee
benefits journey year after year and constantly working to keep your benefits
offerings up-to-date. Your benefits needs will inevitably change as the market
shifts, your company grows, and your employee demographics change. New benefits
will become available, existing benefits will become outdated, and structures
that worked for your startup won’t do as well for your larger, established
company. Not to mention, your employees will get older, or you will welcome a
new cohort of younger talent, and their needs will change.
Which is all to say that it is highly unlikely that the same
benefits package or strategy will be the right choice for your business for
years on end. So, it’s not a great sign if you haven’t seen a noticeable
difference in your package for 3-5 years, or your broker hasn’t been
communicating new options. If you find yourself in this situation, then odds
are you’ve become a “safe” account for your broker and they have started taking
you for granted. In which case it is probably time to prompt them to reexamine
your benefits strategy or start looking for a more proactive partner.
But if your broker regularly notifies you of new options and
consistently works with you to review your benefits package to see if it is
performing well and still meets your needs, then they may be a keeper.
Does Your Benefits Broker Operate
on the Employee Level?
All too many benefits brokers are happy to help their clients
set up employee benefits packages and then walk away, leaving the employer to
manage the roll-out and maintenance of the package as well as convince its
employees of the package’s merits. A good benefits broker will see each and
every one of your employees as their clients, rather than appealing to just
your company’s C-Suite or board.
Your broker should be a benefits advisor, evangelist, and
educator for your employees at every level of the company. First, they should
teach your HR professionals and managers how to work the benefits systems,
communicate plan details and advantages to the rest of the team, and how to
field employee questions. This training should be accompanied by educational
materials and resources to give them the tools they need to guide the rest of
the employees. Their goal should be to create the best possible experience for
your employees and help everyone on the team become a better consumer of
healthcare.
Next, your benefits broker should work on the individual
employee level through educational seminars, Q&A sessions, and other forms
of direct communication. These programs should serve two different purposes.
First, they should help employees understand how to navigate the benefits
package and make the most of the benefits offered. Second, they should impress
upon employees the value of the benefits in order to maximize the impact that
your benefits have on employee retention and engagement.
Be on the lookout to avoid a broker that just wants to deal
with you and does not want to work directly with your HR team, operational managers,
and/or front-line employees. And if your broker takes this approach and is
unwilling to change course, then perhaps it’s time to start shopping around.
Is Your Benefits Broker
Streamlining Enrollment?
Enrolling employees in benefits and health insurance can
become the bane of an HR professional’s existence. Since a large part of your
benefits broker’s responsibilities involves serving as your insurance broker,
they should be an integral part of enrollment as well. An effective, proactive
broker will work with you to streamline enrollment and avoid HR headaches.
The first thing that a great benefits broker will do is help
you establish effective enrollment processes. This includes enrollment tracking
and compliance record-keeping in addition to the systems used to actually
enroll employees in health insurance. Ideally, they will provide or support existing
enrollment software solutions that centralize your data and make enrollment
easy for employees and HR teams alike.
The next thing that employee benefits brokers should do is
prepare employees for enrollment by providing educational resources. They should
create easy to digest reference materials explaining plan structure and
enrollment processes and hold open meetings explaining your benefits package
year-round. They can also help you create a benefits newsletter to regularly
update employees on your benefits package and keep your HR team apprised of any
changes in benefits or procedures. And when open enrollment time comes around
again, your broker should be available to answer any questions that employees,
managers, and HR professionals might have.
Do they Offer the Latest
Technology?
Technology is changing rapidly in today’s market. New tools
are constantly being developed to make things easier for your HR team and for
your employees, and to provide added benefits to employees. Innovation fuels industry
in today’s economy and that is just as true in benefits and HR. New benefits
technology will help you stand out from the crowd to attract the best possible
talent and keep your employees satisfied with their benefits.
And if the only reason you know about new benefits technology
is because of your own research or conversations you’ve had with your peers,
then your employee benefits broker isn’t doing their job. An effective benefits
broker will stay on top of the newest technology and help their clients figure
out what is useful and what is just trendy. And ideally, benefits brokers will
have established relationships with the companies that are developing benefits
technology so that you get access to truly innovative solutions.
It’s generally worth your while to find out if your benefits
broker provides enrollment software, telemedicine options, HR and benefits
automation platforms, and other benefits technology. If you have to go digging
for these solutions, then they may not be the broker for you.
Key Takeaways
Many companies work with the same employee benefits broker for
years. Sometimes that is because they are collaborating closely on an ongoing
benefits strategy that keeps employer costs low, maximizes employee wellbeing,
and makes the HR team’s life easier. Other times, it is because of inertia and
lack of comparison. Hopefully, this article has given you a good idea of how to
tell which one you are and how to make the most of your benefits broker
relationship. Just remember to:
Think about what is best for your employees as
well as your budget – and make sure your broker takes the same approach.
Make sure that your broker is regularly updating
your benefits package and working with you to meet your changing benefits needs.
Partner with a broker who operates on the
employee level instead of just working with your leadership.
Enlist your broker in making open enrollment an
easier and more effective process.
Work with a broker who provides innovative
benefits technology.
Are you looking for a benefits broker who will be your partner
in every aspect of your benefits strategy and implementation? Launchways can
help you navigate the complicated world of employees benefits to create the
most value for your employees and make the most of every dollar spent. Find
out more.
This article was written by guest author Brandon Auster, Principal Consultant at BEA HR.
Acquiring and retaining top executive talent can be one of the biggest challenges faced by early stage and growing businesses. Maintaining a high-impact suite of executive compensation programs is a key strategy for meeting this challenge. These programs must be viewed as an investment in growth and value creation that requires diligent focus in order to be maximized over time.
Executive turnover is a disruptive and costly setback, with a
financial impact of 100% or more of a departing executive’s salary. Meanwhile, engaged leaders are far more
productive and effective at rallying their teams to drive growth. Getting the
right mix and design of rewards elements enables companies to attract, engage
and retain top talent, while maximizing their compensation ROI and driving growth.
Let’s explore some of the highest-impact compensation strategies
that high-growth companies can employ in the effort to cultivate top talent,
including:
Aligning compensation with company culture and strategy
Leveraging bonuses at every stage of growth
Rewarding real results
Leveraging uniqueness
Alignment with Culture and Strategy
Compensation is one of the most powerful and visible ways a
company demonstrates what it values.
Well-aligned compensation programs give companies an
advantage in the talent market and are a catalyst for teamwork, goal achievement
and thriving cultures.
On the flip side, when full alignment is lacking, even the
most well-intentioned and technically elegant pay programs can lead to disappointing
results, discord among team members or tension between executives and ownership.
Looking at the alignment of each individual rewards element is
required, as is a holistic look across all elements of the rewards portfolio including
base pay, bonuses, equity, perks and benefits.
This will ensure each element individually supports and drives the desired
company results and culture, while together, the overall rewards program is greater
than the sum of its parts.
Additionally, as a company grows and evolves, it must continually
reassess its compensation programs to stay in alignment with new circumstances
and objectives.
Bonuses for Every Stage of Growth
Bonuses can be a powerful element of an effective overall compensation
program. It is a common misconception that cash bonuses are only useful for
established cash-rich companies, while early-stage companies should focus solely
on equity compensation. However, the reality
is that currently, almost three quarters of pre-IPO startups with less than $50M
in revenue include bonuses in their executive compensation program.
Augmenting equity with cash bonuses can increase focus and
urgency, while helping employees stay energized during the series of sprints
required to generate long-term growth and equity payoffs.
Given their sometimes unpredictable and volatile pace of
growth, smaller companies may face challenges when designing bonus plans. This makes stress testing compensation plans against
the entire range of possible business scenarios especially important. It is required to fine tune plans to ensure that
fiscal realities are well balanced with desires to pay for performance and retain
key talent.
Not only do bonuses encourage executives to contribute to
the company’s short-term goals that will ultimately lead to its long-term growth,
but they are essential in helping growing companies compete for high-quality
executive talent with larger, more established organizations.
Reward Real Results
Annual bonuses are an extremely useful tool in the
compensation arsenal. However, creatively supplementing a traditional bonus
plan with a results-based program, such as one of those listed below can improve
the impact and ROI of a company’s variable compensation investment even further.
Milestone Plan – payouts are tied to hitting a fiscal or other key objective. This serves to: focus the team on specific goals, incentivize attainment of important results, provide execs with added pre-liquidity cash and celebrate short-term successes. Costs can be fixed upfront at an amount that is commensurate with the value created by hitting the milestone.
Ad Hoc Awards – discretionary payouts are tied to positive performance. While this approach is quickly gaining popularity below the executive level, it can also be used to recognize and encourage upside results for executives. Costs can be managed by pairing with a bonus plan that uses modest targets and/or maximums payouts.
Medium-Term Plan – a two to three-year medium-term performance period is created and payouts are tied to a key success metric such as revenue growth or value generation. These plans can provide liquidity if a longer exit period is anticipated and generate longer-term focus with more tangible risk/reward than either short-term bonuses or long-term equity.
When clearly and proactively communicated, these plans
contribute to a culture of transparency and goal-oriented thinking that is
crucial to rapid and sustainable growth.
They lead executives to feel that their efforts are rewarded fairly while
ownership has confidence that payouts are tied to results that also generate
value for them. This win-win situation
creates a great foundation for long-term partnership and success.
Leverage Uniqueness
While smaller companies don’t have all the resources of
major industry players, they possess many unique advantages in the war for
talent. Understanding these and using them
for maximum impact goes a long way in attracting, motivating and retaining top
talent.
Start with ensuring that people know how much the company is
investing in them. This is most
effectively done through concise, graphical, high-impact total rewards and
equity statements. Total rewards statements depict the value of base, bonus, equity,
benefits and perks. Equity statements demonstrate current equity value and
holdings along with the potential value derived from future vesting and growth
in the company’s valuation.
Closely held companies can exercise far greater flexibility in
issuing equity awards than public competitors for talent. They can use equity awards to reward strong individual
or team performance, recognize milestone achievements or demonstrate commitment
to key talent. It’s also important to carefully
develop a vesting and refresh equity grant structure that ensures everyone
continues to earn equity for ongoing contributions while avoiding vesting droughts
that entice them to look elsewhere.
Strong leaders seek out companies and roles where they will have
significant impact, experience professional growth and contribute to an important
mission. Each small company has its own
compelling story to tell current and prospective team members that other
suitors for their services cannot match.
For example, will company executives: have greater access to the CEO, board,
or other thought leaders; be part of shaping the future of an industry; work with
uniquely passionate team members; build a team from the ground up?
Every company is unique. The most successful ones understand and use
their special blend of culture, opportunities, programs, perks and purpose to create
a competitive advantage whenever possible.
Key Takeaways
Highly capable and motivated executives are required for any
company to generate sustained growth and succeed in bringing its vision to life. Implementing smart and creative rewards
programs are a difference maker in the ongoing effort to acquire, engage and retain
top executive-level talent.
The high-impact compensation strategies outlined above are a
great start for any organization looking to optimize its approach to executive
compensation:
Let business strategy and company culture guide compensation priorities
Leverage bonuses to engage employees at every stage of growth
Focus on bonuses that reward real results to fuel company growth and long-term success
Leverage the unique assets at your disposal to attract and retain the best talent
If you want to take your compensation strategy even farther, don’t miss our upcoming webinar on high-impact executive compensation strategies. We’ll delve more deeply into the strategies in this article and provide more strategies to optimize the effectiveness of your compensation plan, including the most effective approaches to equity grants. Register today.
The healthcare
industry in the U.S. is in the midst of major market disruption. As systems condense and integrate and
nontraditional players enter the marketplace, guiding this transformation will
require smart, bold action on a variety of fronts.
Human Resource teams and insurance companies have traditionally led
the way when it comes to initiating and implementing improvement efforts. While
they have achieved some level of success, there is opportunity to do more. Surprisingly,
in the abundance of material on healthcare
improvement planning, we find very little that speaks to the role of one central
individual—the CEO. What precisely should be the task of the CEO, and how is
this role different from that of other executives or other stakeholders?
In today’s fast-moving business environment, companies cannot settle for incremental improvement; they must occasionally make radical changes to remain competitive. This is particularly true in the age of market disruption. In this post, we’ll look at some of the market dynamics that are driving the need to improve the healthcare delivery and cost model and examine several best practice actions CEOs can take to help accelerate these improvements, including:
Clear communication
Strategic collaboration
Leading by example
Healthcare as a core
business issue
A fundamental management tenant is that leaders
take personal ownership of their company’s toughest challenges. Still, despite persuasive
arguments, many CEOs have not treated health care costs as a central business issue.
They often transfer the responsibility to other internal teams or departments
that lack accountability for the company’s financial performance. This is not
the optimum approach.
Getting CEOs to approach health care costs like they do other parts of
their business can deliver substantial performance results. Key attributes CEOs
can bring to the forefront are their motivational and influencing capabilities.
They can help bolster improvement efforts by
communicating the rationale for healthcare changes, securing beneficial
alliances and modeling the desired changes.
Clear communication. CEOs regularly make gutsy decisions that affect employees, from
closing business units to discontinuing strategic operations. They make clear the
reasons for the changes, and employees acknowledge them as a part of their workplace
reality. Communicating health care changes should be no different.
The area of cost
containment and balancing rising healthcare expenses with employee expectations
is a good example. Controlling costs often requires steering employees to
providers that can deliver high-quality care at the lowest price. But imposing limitations or implementing any
type of healthcare change can be met with stiff opposition—even though the
change may be in the best interest of all parties.
This is where
honest, transparent communication is vital.
Case in point: Walmart confidently uses financial incentives to guide
employees toward a number of pre-selected centers of excellence— specialized
programs with concentrated areas of expertise— for expensive medical procedures.
The practice has resulted in significant cost savings. Employee complaints have
been minimal because the company’s leadership has effectively communicated the reasoning
and logic for the practice just as they do with any other important change in
company strategy.
Strategic
collaboration. Strategic partnerships are essential for
remaining competitive in today’s highly disruptive business environment. To
become more entrenched in the ecosystems that employees engage in, it’s
important for CEOs to strengthen and expand their alliances with a broader
range of partners in and outside the healthcare market. CEOs are ideally
positioned to work with potential partners to identify ways to work together
for mutual advantage.
The trend toward value-based care will continue to drive companies to closely scrutinize their healthcare options and fine-tune their cost management approach. Business can’t do much about shifting market dynamics. But they can team together to more effectively negotiate with providers and help ensure that healthcare quality is in line with costs. Bottom line: CEOs who form smart alliances and are proactive in their collaborative approach will save more on health care as will their employees.
Leading by example: When substantial financial
risk is at state, CEOs have a fundamental duty to roll up their sleeves and get personally involved. Leaders who give only lip-service
to an improvement effort will find everyone else following suit.
Modeling the behavior you want and
creating a personalized story will help employees buy into in the improvement
approach by answering their pressing questions, such as “What are we changing?” “How will it be implemented?” and “How will
it impact me?” People will go to surprising lengths for issues they believe in,
and a compelling example set by the CEO will establish and reinforce their loyalty
(and participation) in the effort.
Key takeaways
CEOs are uniquely positioned with the responsibility
and authority to articulate the strategy, vision and goals that frame every new
business challenge or initiative. This is especially true when it comes to managing
a transformation as significant and sensitive as employee healthcare.
For CEOs leading healthcare transformation, there is no single model for success. But they can place the odds in their favor by focusing on several core leadership actions: making the changes understandable and meaningful; modeling the preferred behavior; building a reliable and loyal team; and relentlessly pursuing results. Together, these efforts can generate the synergy needed to achieve tangible, lasting improvements.
The unemployment rate has now fallen to 3.6%, according to recent data from the U.S. Bureau of Labor Statistics. While American workers welcome the news, it can be a challenge in this climate for hiring managers to stand out and continue attracting the best talent out there.
If your business is struggling to fill open positions, and you’re not receiving the quality applicants that you’d hoped for, take a look at your benefits package. When was the last time you updated it?
The 2018 Employee Benefits Survey from the Society of Human Resources Management (SHRM) showed that 34% of organizations beefed up their benefits packages within the last year, and 72% said that retention was a reason they did so. Over half cited attracting top talent as a main part of their reasoning.
In our current “war for talent” climate, creating a benefits package that can sell itself to candidates will ensure you’re attracting that top talent. In fact, your benefits package could be the differentiator that will give you the timely competitive advantage you need. A CareerBuilder survey revealed that 32% of workers will be looking for a new job in 2019, 15% of whom cited lack of benefits or low compensation as the reason.
Here’s how to create a high-impact benefits package that will help your business both attract and retain top talent.
Understanding What’s Hot
Of course, what’s most important to the top talent you’re looking for will depend on your industry. For instance, not every job can offer remote work benefits—some require a worker’s presence in the office.
However, there are general trends as far as benefits go. The same SHRM survey mentioned earlier also showed that benefits for parents have been increased in the last few years, including paid maternity and paternity leave and adoption, foster child, and surrogacy benefits.
According to Jobvite’s 2018 Recruiter Nation Survey, recruiters say that the most effective benefits to attracting top talent are medical and dental benefits (67%), followed by 401(k) benefits (55%).
Medical and dental benefits may seem like a given, but making these benefits competitive in themselves can upgrade your overall package. This is why it’s important to shop around for the best price on packages that offer the comprehensive care that your employees need. For retirement, many workplaces offer a company-matching benefit that top talent will look for when considering job offers.
The next most important benefit offering discussed in the Jobvite survey was work-from-home benefits. As mentioned above, this benefit may or may not be possible for your given industry. However, with our current everything-digital work culture, it’s worth considering making it happen, as 43% of recruiters said this was the most effective benefit offering to attract and retain talent.
Offering a flexible work arrangement or flexible schedule shows employees that their work-life balance matters, and that the company wants to support them in managing family obligations and other priorities outside of work.
The last three benefits listed as top attractions in the Jobvite survey were casual dress (36%), continuing education reimbursement (31%), and a signing bonus (28%). Paid vacation is still considered a top benefit, and many top candidates will negotiate the amount of days off they receive with the rest of their offer.
Another hot topic in the benefits world is student loan help. According to data from the Harvard Business Review, 48% of job seekers said that student loan assistance would be taken into account when considering a job offer.
Americans now owe around $1.57 trillion in college debt, as USA Today reported, yet only one in 10 companies surveyed by the Employee Benefit Research Institute offer student loan repayment subsidies or consolidation or refinancing services for employees. This means that employers willing to make this a priority will be ahead of their competitors when attracting top talent.
These examples show how any organization can construct a benefits package that checks off the list of what the modern candidate is looking for.
Building a Comprehensive Package
Once you’re aware of what candidates want, how do you begin the reconstruction process?
1. Research the competition
First, assess the trends within your industry. Start by researching the job ads that competitors are posting, or use a tool like Glassdoor to view salary trends for a given job title or company. Understanding what your competitors are offering is crucial to creating a competitive advantage.
You may also learn about other company’s benefits through interviews with top-level candidates. They may ask for a certain amount of vacation days, a salary level, or 401(k) contribution because they’re receiving it in their current position.
But as ApplicantPro points out, your top recruiting competition may not be the same as your business competition. Companies hiring individuals with the same qualifications, and not necessarily a company offering the same services as yours, may be more of your hiring rival.
2. Use data in strategic planning to increase ROI
Keep up on the latest research about what employees want, in addition to what competitors are providing. Each year, human resources organizations release surveys that reflect the latest trends, such as the surveys mentioned in this article from the SHRM and the Employee Benefit Research Institute.
According to the SHRM, planning benefits strategically based on specific data can help your company receive the greatest return on investment. This is important, because benefits aren’t cheap—they make up about a third of compensation costs (32%). When companies strategically plan benefits for recruitment and retention, the overall performance of the company is above average at 58%, versus 34% from organizations that don’t plan strategically.
3. Understand what drives motivation
Employees are more likely to feel motivated and satisfied by their work if they’re fully supported with adequate pay and benefits. This means making enough money, but it also means being able to receive high-quality healthcare services and to take time away from work to relieve stress and enjoy their personal lives.
This is why it’s also smart to offer a comprehensive wellness program that offers discounted gym memberships, for example, or mental health services, along with a good healthcare package. Over half of employees surveyed by the SHRM said that healthcare, paid leave, and flexible benefits were very important to job satisfaction.
Remember to approach the construction of your benefits package with people in mind, not just the bottom line.
4. Ask your employees for feedback
To better understand what would entice employees to stay at your company, why not ask them?
Implementing some kind of survey system can be instrumental in building a benefits plan that meets the expectations of employees. Just the gesture alone can show workers that you are considering their needs and desires, which can lead to greater feelings of satisfaction and recognition.
Consider holding discussions about benefits where employees can make comments and ask questions, and invite them to offer their opinions about their current package.
5. Continue adapting
During interviews with top candidates, one strategy that could help you succeed is being open to what they’re looking for, and asking them what their expectations are. This can not only open your eyes to what top talent is looking for, but it can also help you revamp your benefits offerings for your current employees.
Updating your benefits package is not likely to be something you can do once and be done with. Preferences change year over year in the realm of recruitment, as new technologies are introduced or new working trends pick up, so remember that your benefits plan needs to be revisited and adapted regularly. For example, the gig economy and the surge of freelancing has made flexibility and remote work more popular and desirable for employees across industries.
6. Embrace new technologies
Finally, recruiters and hiring managers should embrace new technologies that can help them create a strategic benefits plan for recruitment and retention.
According to the Jobvite survey mentioned above, almost half of recruiters say that artificial intelligence (AI) and automaton will improve their jobs and will allow them to focus more on strategy. Streamlining tasks can open up a lot of time that can be used on research and data analyzation that will lead to better benefits planning that’s focused around attracting talent.
Using an online benefits portal is another way to increase employee satisfaction and streamline the benefits process. According to the SHRM, 32% of HR professionals say that an online portal is very effective as a communication method with employees. A portal can help the HR team deliver messages while emphasizing the value of benefits to employees.
Key Takeaways
Winning the war for top talent takes research, planning, and strategizing, and may not happen overnight. But it’s more important than ever to focus on benefits offerings as the unemployment rate continues to drop and the recruitment competition heats up. Remember to:
Stay abreast on what’s hot in the world of HR and recruiting
Research your competition
Base benefits planning decisions on specific data to ensure Return on Investment
Think about what drives employee motivation and satisfaction
Survey employees and candidates to find out what would excite them beyond a high base salary
Continue to adapt your plan
Integrate new tools and platforms that will streamline processes for both you and employees
If you show both top candidates and current employees that benefits are important to the organization and do the research to offer what they really want, you’ll be well on your way to creating a high-impact benefits package that will set you apart from competitors.
Several new laws have been passed in the Illinois General
Assembly recently that will impact both employers and employees across
Illinois. The last step before enactment is for Governor Pritzker to sign off
on these bills.
The new laws bring several changes to the table, including:
Creating limitations on contract terms and
employee handbooks
Amending three acts: the Illinois Human Rights
Act, the Illinois Equal Pay Act, and the Victims’ Economic Security and Safety
Act
Requiring more anti-harassment trainings for employers
Legalizing recreational cannabis use
These changes will impact employer policies. For example,
employers will need to update discrimination policies and procedures, or if
recreational cannabis is legalized, this could create concerns if an employer
still prohibits drug use.
The Workplace
Transparency Act (Effective January 1, 2020)
The Workplace Transparency Act (IWTA) aims to prevent
workplace harassment and discrimination by improving the security of employees’
rights. Within employer contracts and policies, the IWTA prohibits specific
aspects of confidentiality, non-disparagement, and arbitration clauses, unless
other statutory requirements are first met.
The IWTA requires Illinois employers to both review and
update their contracts, particularly their noncompete, non-solicitation, and
confidentiality terms, in addition to separation or severance and arbitration
agreements and employee handbooks and policies.
It’s important to note, however, that these new terms don’t
apply to collective bargaining agreements, which applies to both private and
public employers that have unionized workforces.
All contracts and
policies:
The IWTA requires that, without exception, no contracts or
agreements can contain language that prohibits employees from reporting
“unlawful conduct” to officials, whether local, state, or federal, for
investigation. This law is relevant to prospective, current, or former
employees, and applies to all types of policy document or employment agreement
(formal employment agreements; executive compensation agreements; noncompete,
non-solicitation, or confidentiality agreements; or separation agreements).
“Unlawful conduct” can include criminal conduct or unlawful
employment practices—for example, behavior that would violate the anti-harassment
and discrimination laws outlined by the Illinois Department for Human Rights
(IDHR) and the Equal Employment Opportunity Commission (EEOC).
The IWTA also prohibits, without exception, any provisions
that would prevent an employee to testify in the event of a subpoena, court
order, or other written request regarding criminal conduct, discrimination,
harassment, or other unlawful employment practice.
Unilateral employment
contracts and policies:
Employment contracts and policies—specifically those that
are non-negotiated or that must be signed as a condition of employment—are not
allowed to prohibit any employee, whether prospective, current, or former, from
making disclosures or truthful statements regarding alleged discrimination and
harassment or unlawful employment practices.
An example of what this means is that if any provision or
clause could be read to indicate that it prevents an employee from truthfully
stating or disclosing discrimination or harassment, regardless of how a
contract provision was enforced, the clause would then be unenforceable.
If employers wish to keep this kind of provision, they could
be required to negotiate agreements that contain confidentiality clauses with
employees and include bargained-for consideration and a clear acknowledgment of
employees’ right to do the following:
Inform a local, state, or federal agency that
enforces discrimination laws of good-faith allegations of unlawful practices
Inform local, state, or federal officials of
good-faith allegations of criminal conduct
Contribute to proceedings with any local, state,
or federal government agency that enforces discrimination laws
State or disclose any truthful information that
is required by law, regulation, or legal process
Seek out or receive legal advice that is
confidential
Unilateral
arbitration agreements:
Certain agreements may not be enforceable that meet the
following criteria: agreements that are non-negotiated and require arbitration
of discrimination and harassment claims (as opposed to wage and hour claims) as
a condition of employment. Similar to confidentiality agreements, however,
arbitration agreements could still be enforceable under the new law if they are
negotiated with the employee and include bargained-for consideration and
acknowledge the five employee rights listed above.
Under the potentially amended Illinois Uniform Arbitration
Act, arbitration agreements may be non-compliant with the IWTA and thus they
may be void. It is still unclear whether Illinois arbitration agreement law
will be preempted by federal law in some cases. Thus, these agreements must be
drafted carefully to ensure that they are enforceable.
Settlement and
termination agreements:
Termination agreements (also known as separation or
severance agreements) and settlement agreements could include confidentiality
promises that relate to discrimination and harassment if these statutory requirements
are met:
The employee has documented confidentiality as a
preference, and the obligation is mutual under the contract.
It is told to the employee in writing that he or
she has a right to an attorney or representative (of his or her choosing) to review
the contract before it is signed.
In exchange for the confidentiality, there is a
bargained-for consideration that is valid (for example, a severance payment
instead of just the payout of final earned compensation).
No claims of discrimination or harassment are
waived in the agreement that ensue after the agreement execution date.
The employee has 21 days to consider the
agreement before signing it, in addition to 7 days to withdraw acceptance of
the agreement. (This is similar to the drafting of waivers of age-related
claims at the federal level, with people who are over 40.)
The employee would in no way be precluded from releasing
discrimination and harassment claims by the IWTA, except prospective claims.
Enforcement:
If employees are successful when they challenge a violating
contract’s enforceability under the IWTA (but not an employment policy), they
will have the right to recover attorney fees and costs.
Other exceptions:
However, employers could require the following individuals to
maintain confidentiality of discrimination and harassment allegations:
Employees who, as part of their job duties
(e.g., human resources professionals) receive complaints, investigate
allegations, or have access to confidential information regarding personnel
A third party or employee who is asked to
participate in an open and ongoing investigation (e.g., a witness)
A third party or employee who gets attorney work
product or communications that are attorney-client privileged, or who is
subject to a recognized privilege
Any third party that investigates complaints, hired
by the employer
Illinois Equal Pay Act Amendments (Effective 60 Days
After Signed)
The following amendments would apply to the Illinois Equal
Pay Act.
Wage and salary
history of job applicants:
The amendments would prohibit employment agencies and
employers from requesting the following information or requiring job applicants
to disclose it: prior wage, salary, benefit, or other compensation history
information as a condition of the application process or of employment. They
are also prohibited from otherwise screening job applicants by requiring they
meet minimum or maximum compensation criteria.
Both employers and employment agencies will be prohibited
from seeking the above information about job applicants from current or prior
employers. However, they are not prohibited from talking with applicants about
wage, salary, benefits, or other compensation expectations.
If prior compensation history is disclosed voluntarily by
the applicant, the information cannot be considered when the employer is
deciding whether or not to make a job offer, nor in determining the terms of
the job offer. To comply with these amendments, employers will likely need to
update their job boards, interviewing processes, recruitment practices, and job
applications.
Wage differentials:
Employers could also be subject to increased burdens in
order to justify imbalances in pay among their employees. This especially
applies to employees who have similar jobs but receive different pay rates, and
employers could be required to show that the difference in pay is because of
job-related reasons that are: 1) consistent with the needs of the business and
2) accounts for the difference in compensation, if there have been allegations
against the employer that they underpay certain employees based on their sex or
for being African American.
Wage and salary
information of employees:
The amendments state that employees cannot be prohibited
from being able to disclose or discuss compensation information, including that
regarding wage, salary, or benefits. But, if certain positions require access
to this information, such as human resources employees, they can be told to
keep this information confidential. To be in accordance with these changes,
handbooks, policies, and confidentiality agreements may need to be updated.
Penalties:
To enforce these amendments, State court lawsuits may be
filed by employees who are seeking “special damages” of a maximum of $10,000,
or actual damages more than $10,000, injunctive relief, and costs and
reasonable attorney’s fees. If an employee can prove that he or she was
underpaid based on their sex could receive the underpayment amount, punitive
damages, and injunctive relief, in addition to uncapped compensatory damages if
it is also proven that the employer behaved with malice or reckless
indifference. Penalties up to $5,000 could also be sought by enforcement
actions from the Illinois Department of Labor for each employee that was
impacted and for each violation.
Illinois Human Rights Act Amendments (Effective January
1, 2020)
To address the security of employees’ rights to protection
from harassment and discrimination, the Illinois Human Rights Act (IHRA) would
be amended in the following ways.
Expanded coverage:
The IHRA would be applicable to Illinois employers with one
or more employees during 20 or more calendar weeks during the current year or
within the year before the alleged violation took place. This amendment is
significant because as the IHRA stands now, this applies only to employers with
15 or more employees. The expanded coverage would go into effect on July 1,
2020.
Expanded protected
classes:
Discrimination and harassment prohibitions would be expanded
so that all actual and perceived protected classes, which include race, sex,
age, religion, or sexual orientation, among others, would be covered.
Additionally, the amendment further defines harassment as any “unwelcome
conduct” with “the purpose or effect of substantially interfering with the
individual’s work performance or creating an intimidating, hostile, or
offensive working environment.” This definition is more broad than federal law.
Clarified work
environment:
Regarding the prohibition of discrimination and harassment,
the work environment will no longer be limited to an employee’s assigned physical
location.
Employer liability:
The IHRA amendment would also update harassment
responsibility for the employer. They may be responsible for harassment by
employees who are non-managerial and non-supervisory if the employer is made
aware of the behavior and does not take appropriate action. In addition,
employers would be responsible for harassment of non-employees who are in the
workplace to provide services for the employer. This could apply to consultants
or contractors, for instance.
Annual training:
Sexual harassment training for all employees would be
required from employers, at least once a year. The training materials used will
be developed by the IDHR or an equivalent body.
Restaurants, bars,
and coffee shops:
A written sexual harassment policy must be made and given to
all employees within their first week of employment. This policy has to meet
certain statutory requirements, including that the employee must be given
notice about the procedures to file a charge with the IDHR and EEOC. Mandatory
training programs specific to the bar and restaurant industry will be designed
by the IDHR, and this will be in addition to the training program for all
employers. These policies and trainings are required to be available in both
English and Spanish.
Disclosure
requirements:
Every employer that had an adverse judgment or ruling
against it that is related to discrimination or harassment must report
information about the judgments or rulings to the IDHR, starting July 1, 2020,
and recurring by each July 1 thereafter. When charges of discrimination are
investigated, the IDHR could request that employers disclose information about
settlements that involve discrimination and harassment allegations, though this
excludes the names of the alleged victims.
New penalties:
Penalties will apply to employers that do not meet these
training and disclosure requirements. The penalties are not to exceed:
$500 for the first offense
$1,000 for the second offense
$3,000 for the third and any following offenses
Union employees:
If the same union represents the victim and the perpetrator
of alleged sexual harassment, different representatives from the union must be
delegated to represent them in proceedings.
Procedural changes:
Procedures for filing charges and investigation would be included
in the amendments. The changes include that either party would now be allowed
to ask the IDHR for a pending charge dismissal if a lawsuit at the state or
federal level is filed because of the same issues that were raised in the
charge. Another update is greater clarity regarding prior amendments in 2018,
which allowed the charging party to bypass investigation procedures and go
directly to the state court.
The Victims’ Economic Security and Safety Act
(Effective January 1, 2020)
Another amendment applies to the Victims’ Economic Security
and Safety Act (VESSA), which would expand protections for victims of domestic
and sexual violence, sexual assault, and stalking to those victims of gender
violence.
Gender violence is an act or acts of violence or aggression
that would be considered a crime under state law and is committed (at least
partially) based on someone’s actual or perceived sex or gender, or based on
physical instruction or invasion that is a crime, whether or not criminal
charges are brought. The threat of any of these actions would also be included.
If an employee is a victim of domestic, sexual, or gender
violence, or has family members who are victims, employers are now required to
give them up to 12 weeks of leave within a year, with job protection, or a
similar accommodation that could be determined by how large the employer is.
The employee victim can take this leave for counseling, legal help, medical
services, safety planning, and the like.
Hotel and Casino
Employee Safety Act (Effective July 1, 2020)
Hotel and casino workers in Illinois will be protected from
sexual assault and harassment under the Hotel and Casino Employee Safety Act,
which requires employers within these industries to give employees assistance
in the event of an ongoing crime, sexual harassment or assault, or other
emergency. Employers would be required to give them safety devices or other
notification tools.
This act also requires relevant employers to incorporate
anti-harassment policies that meet statutory requirements. These requirements
include things like temporary work assignments, reporting procedures for
complaints, or paid leave to testify or file a police report. The act states
that lawsuits can be filed by employees in state court and they could recover
attorneys’ fees and economic damages of $350 per day and per violation.
Cannabis
Regulation and Tax Act (Effective January 1, 2020)
Cannabis Act employer
obligations:
Recreational cannabis is on the horizon for Illinois if the
bill is signed, which would make it the eleventh state to legalize recreational
cannabis. The Cannabis Regulation and Tax Act (also known as the Cannabis Act)
will begin on January 1, 2020. This act will allow Illinois adults to both
possess and consume cannabis, but it may create issues for Illinois employers.
The Cannabis Act does allow employers to implement reasonable and
nondiscriminatory policies that support zero-tolerance, drug-free workplaces,
which could include drug testing and workplace-use prohibition policies.
The Cannabis Act permits employers to ban cannabis use to
meet contract obligations or to comply with state or federal funding or legal
requirements. However, employers generally cannot take an adverse action
against an employee or an applicant because of their marijuana use outside of
the workplace. The Illinois Right to Privacy in the Workplace Act is also
amended so that marijuana products are legal and must be treated similarly to
tobacco and alcohol. Employment decisions cannot be made based on whether an
applicant or employee uses cannabis off-site, during nonworking hours (or
non-call hours), whether medically or recreationally, as long as the use is
lawful.
Employers should then assess whether or not an employee is actually
impaired or under the influence of cannabis during working hours if they are
considering disciplinary action against an employee, since they are not allowed
to consider the lawful use of cannabis outside of work. Disciplinary action
would be allowed if an employer has a “good faith belief” that their employee
is under the influence in a situation that is similar to “reasonable suspicion”
standards.
If an employer decides to act on this disciplining, they are
required to give the employee an opportunity to contest the decision, and drug
testing could be used in this case. However, legal challenges could arise
because cannabis-related impairment is more difficult to discern when compared
to alcohol impairment testing, for example. In addition, employee victims could
recover actual damages, costs, attorneys’ fees, and fines, so employers need to
make sure that they are taking these new laws into consideration before acting.
Practices and procedures should be updated accordingly.
Labor peace
agreements:
Labor peace agreements aim to give labor organizations the
ability to access and organize the workforce of a business that is licensed to
dispense cannabis. Organizations that are applying for a cannabis-dispensing
license should thus note that the state government will consider whether they
have entered into a labor peace agreement with a labor organization. Because these
agreements can be complicated, it’s important to work with an attorney
experienced in labor law.
Conclusion
Illinois’ pending legislation means that employers need to update their documents and policies accordingly. This includes reviewing and revising employment agreements, employee handbooks, and non-disclosure and separation agreements. Any other policies or agreements related to employment will also need to be revised accordingly so that employers are in compliance with these amendments.
In many cases, employers struggle to keep up with constantly-changing state legislation. Even one compliance infraction could cost your business hundreds of thousands of dollars in fines. Consider working with a compliance partner like Launchways to ensure all your compliance concerns are taken care of proactively.
If your business is like most, in the early stages it was
all-hands-on-deck with everyone doing whatever it took to keep the organization
afloat. You likely pieced together a human resources process with several
people taking on various duties.
Managing HR may
be something you can’t – or shouldn’t– use your valuable time to do, depending
on the scale of your organization. If the leadership team of your small to
medium sized business has been handling the HR tasks it may be time to hire an
HR pro. However, how do you evaluate when is the right time to make that
decision – and who you should hire to do which HR tasks?
In this post,
we’ll discuss
Growing pains that indicate it’s time to add HR to your team
Tactical and strategic HR tasks
Types of HR employees
HR technology and outsourcing
Growing Pains
You’ve pieced together
an HR process that seems to be working. Recruiting and hiring are handled by the
business founder who’s been tasked with building a team from scratch. Your CFO
manages payroll and compensation and handles benefits issues. Meanwhile, your
admin or office manager processes new hire forms and requests for time off.
Then you hit a
snag.
You’re not attracting the best candidates
An overburdened key employee quits
You face legal and compliance issues
You don’t have a process to make essential hires quickly and effectively
With so many
competing priorities, you may find it challenging to prioritize HR. Perhaps
your top pick for a critical role turned you down because you haven’t had the
time to research what’s in a competitive benefits package, let alone put one
together. You missed out on another candidate when they lost interest because
you spent your time screening candidates for a different role instead of
getting back to them. Then your admin quit because she couldn’t keep up with
her “other duties as assigned” HR tasks while also assisting
customers and supporting your sales team.
If that wasn’t
bad enough, your legal fees are starting to add up. An employee filed a sexual
harassment claim against your company. Then, because you misclassified a team
member as exempt to avoid paying overtime, you’ve got a wage dispute on your
hands.
But bad news
isn’t the only reason to add HR to your team. Perhaps you landed a big contract
and you need to add 20 people to your service team – yesterday. An important
client wants you to add a second team to support another of their facilities.
An online marketing campaign is bringing in three times the orders your staff
can handle, and you’re starting to get backed up. HR issues can arise as your
company grows because your existing team is just too busy to do it all. Other
times, it’s because you “don’t know what you don’t know” when it comes to HR.
HR Duties
Low
unemployment, new technology, and increasing employee expectations have caused basic
HR processes to become much more involved. Putting thought into what your
organization really needs in terms of HR support can help determine your
long-term HR strategy. There are tactical and strategic aspects of modern HR
teams. You can hire someone to prioritize tactical or strategic HR tasks: however,
it’s difficult and impractical to hire someone to handle both these types of HR
tasks.
Tactical HR
A tactical HR
team member focuses on the manual administrative and technical tasks of HR.
Tactical duties:
Post job openings
Track and screen candidates
New employee orientation
Prepare and update employee records
Organizing and storing employee data
Ensuring state and federal compliance regulations are
met
Processing payroll
Benefits administration
Time-off requests
Track mandatory compliance training
Strategic HR
Strategic HR
focuses on your organization’s growth and long-term HR planning. A strategic HR
staff person is more likely to be part of your leadership team than tactical HR
staff. In today’s competition to recruit and retain the best talent, adding an
HR strategist to your team often makes good business sense.
Strategic
duties:
Company culture development
Employee engagement planning and implementation
Professional development and training
Job description creation and updates
Hiring to develop future leaders
Employee retention plan
Types of HR Employees
You can learn
more about various HR positions through the Society for Human Resources
Management (SHRM) or other sites such as Human Resources Education. We’ll give
you examples of a tactical HR position and a strategic HR position typical in
small to medium-sized businesses.
Human Resources Specialist (Tactical)
A Human
Resources Specialist typically has a bachelor’s degree and is early in their HR
career. They are a generalist more focused on tactical HR tasks rather than
strategic HR tasks.
Duties
Recruiting:
Coordinate job postings, process resumes, and applications, screen job
candidates, perform background checks and conduct initial interviews
Records:
Prepare and update employment records related to hiring, compliance,
promotions, and terminations
Onboarding:
Conduct new employee orientation by explaining employment policies, procedures,
job duties, schedules, and benefits
Discipline
and complaints: Address work complaints and harassment allegations, tracks
employee discipline
The U.S. Bureau
of Labor Statistics notes that the median pay for an HR Specialist in 2018 was
$60,880 or $29.27/hour.
Head of People (Strategic)
You can count
on a strategic HR hire to handle the overall administration, coordination, and
evaluation of your HR plans, programs, and goals. This person typically has
five or more years’ experience in HR and a bachelor’s degree. The strategic HR
hire is your organization’s link between employees and your leadership team.
Duties
Management:
Develop and administer your HR records, plans, procedures, programs, and budget
and manage other HR staff or personnel tasked with HR duties
Programs:
Develop and manage compensation program, personnel policies and procedures,
employee handbook, employee evaluation process and benefits, and wellness
programs
Recruiting:
Develop staffing plan; create and revise job descriptions and employment ads;
oversee all recruitment; develop interview process; and conduct new employee
orientation
Retention:
Develop employee recognition program and professional development plans; manage
employee relations counseling, and conduct exit interviews
Planning:
Develop corporate culture with the leadership team and recommend new policies,
programs, and procedures based on long-term goals and current HR best practices
Although the paygrade
for this position will vary greatly commensurate of the candidate’s experience
level, the salary for an HR Manager can be used as a point of comparison. The
U.S. Bureau of Labor Statistics notes that the median pay for an HR Manager in
2018 was $113,300 or $54.47/hour.
You may save on
salary costs initially by hiring a less experienced HR team member, but someone
who has been keeping up on HR trends and technology may save you money in the
long run. Rather than focus on hiring when employee count reaches a specific
number, think about who’s handing HR now and whether that time could be put to
better use generating revenue or innovating new products.
HR Outsourcing & Technology
Now that you
have a better idea of what an HR team member can do for you and what they’ll
cost, you may be thinking hiring another full-time person just doesn’t make
sense at this time. Utilizing HR technology and outsourcing HR tasks may be a
more cost-effective solution for your business.
Outsourcing can
help you to adapt to your changing HR needs as your business grows. Working
with an HR partners also ensures your HR technology will meet the expectations
of today’s tech-savvy millennial workforce. Your outsourced HR partner will
track and provide data to help you better manage all aspects of HR as you grow
your business and your team.
HR Technology
Launchways
offers the top HR technology and can advise and customize based on your
business needs. Launchways HR technology solutions ensure your business can effectively
handle tactical HR duties such as:
Payroll
Compliance
Recruiting
and application portal
Time
scheduling and tracking
Online
benefits portal
Online
performance reviews
Outsourcing
Launchways offers fully-outsourced solutions for payroll, benefits administration,
and compliance. Working with the Launchways team ensures all these important
aspects of your business are handled correctly, while freeing up the time of your
leadership team for more important duties.
Key takeaways
When your
organization is experiencing growing pains – and ideally before you run into
compliance and other legal issues – it’s time to add to your HR capabilities.
HR duties are many and varied, from time-consuming tactical administrative
tasks to strategic HR planning to help your organization be more attractive to
top talent.
Generations Y and Z will become the largest living
generations in 2019, having already have surpassed Generation X in the workplace,
and by next year will represent half of all workers globally. With so many
working for you, understanding what makes them tick – and stick with you – is
essential to attracting and retaining the best available talent to support your
business goals.
You’ve got your work cut out for you: the younger
generations don’t have a very high opinion of business. The 2019 Deloitte
Global Millennial Survey found a decreasing percentage of Gen Y – 55% in 2019
versus 61% in 2018 — believe business has a positive impact on society and
that 67% of businesses “have no ambition beyond wanting to make money.” That’s
important because Generations Y and Z often put purpose before their paycheck.
But despite their reputation as job hoppers, Generations Y
and Z are slightly less likely to leave a job after a short time than
Generation X. In 2018 about 50% of Gen Y reported working for their current
employer for at least five years, and 80% said they had stayed at their job at
least 13 months.
Jobvite noted a 20% drop in workers who say they change jobs
every one to three years (16% in 2018 versus 20% in 2017). However, despite job
satisfaction at 68%, workers say they’re still open to other opportunities.
With unemployment at record lows, these workers have more possibilities if they
choose to leave.
What’s driving them away? Gallup’s 2017 “State of the American
Workforce” report noted 91% of the thousands surveyed said they left their last
job because there wasn’t a compelling reason to stay. And Deloitte found that
almost half would quit their current job within two years if they had a choice.
It’s well past the time to rethink your recruiting, hiring,
and retention practices to keep Generations Y and Z in your workforce.
In this post, we will discuss the state of employment in
2019 as well as what the younger generations believe is important at work, what
Gen Y and Gen Z don’t value at work, and strategies to keep these employees
working for you. We’ll cover:
What’s not important to Millennials at work:
Perks such as free food and games
Certain benefits, such as 401(k), are less
important
Being told the company holds their values –
without backing it up with action
Maintaining the status quo
What’s important to Millennials at work:
Company values and transparency
Work-life balance, including flexible work
hours, working from home
Diverse and inclusive culture
A variety of benefits
Strategies to keep Millennials working for your
organization:
Create a company culture with their input
Develop their talent
What’s not important to Gen Y and Gen Z at work
Pointless Work Perks
The startup and tech culture of the West Coast perpetuated
the idea that free cereal bars and fancy coffee machines in the breakroom,
foosball and ping pong tables in the hallways, and artsy open concept office
spaces were all that was needed to attract and retain workers. This is not so. Gen
Y and X employees know that perks like these don’t equal benefits – or say much
about the true nature of a company’s culture.
Lip-Service-Only
Values
If your recruiting materials and HR discuss a company
culture that embraces diversity and inclusion, but leadership at all levels
doesn’t support those ideals, Gen Y and X will figure that out quickly – and
they don’t appreciate these inconsistencies. In fact, about two-thirds of those
surveyed by Deloitte said business leaders only give lip service to diversity
and inclusion in the workplace.
Retirement-Focused
Benefits
The younger generation saves for retirement and wants you to
contribute to their 401(k). However, this cash-strapped generation saddled with
student debt also emphasizes other financial benefits available to them now and
emphasize financial wellness such as access to financial education platforms,
budgeting tools, and financial coaches.
Change-Adverse
Workplace
A “this is the way we’ve always done it” philosophy
perpetuated by managers and staff resistant to change will turn off younger
employees. They want to be heard, and have their suggestions taken seriously.
They have spent their lives adapting to ever-changing technologies and expect
to use technology to enhance work productivity.
What is important to Gen Y and Gen X at work
Company Values
How they spend their time, who they work for, and what they
do is often more important to Gen Y and X than earning a big paycheck. These generations
do not only expect their employers to strive for financial success, but also
want the organization to make a positive impact on the world. Working for an
organization that supports charitable causes and gives back is also important
to 75% of job seekers.
They’ll also expect you to maintain transparency by
communicating about finances and leadership. Generations Y and X want to learn
about challenges and mistakes made by their organization from leadership, not
the rumor mill.
Work/Life Balance
Flexible schedules and work-from-home options are no longer
benefits offered to favorite employees. Employees from the younger generations
understand that technology makes it easy for them to work remotely and they
don’t want to commute to the office every day. They expect you to treat them as
adults and understand they will be productive from home and outside of the
traditional 9 to 5 working hours. This isn’t a new concept: the 2015
AfterCollege Career Insight Survey noted 68% of Gen Y wanted the option to work
remotely.
The United States isn’t exactly known for work/life balance:
employees are expected to work long hours, take work home, and skip vacations. But
the AfterCollege survey noted that 68.78% of entry-level job seekers value
work/life balance more than any other factor after salary. A flexible work
schedule was No. 4 on the list, with 53.8% noting flexibility as an essential
factor.
Diverse and Inclusive
Culture
It won’t take employees from Gen Y and X long to learn
whether you back up your diversity and inclusion policies with real action.
They will review your leadership – C-suite and corporate board – for diversity
of race, ethnicity, age, gender identity, and more. In the era of the Me Too
Movement, these employees won’t settle for an organization that’s mostly-male
with a top-down management style.
Good Benefits
Don’t be mistaken, a focus on values and flexible work
schedules does not mean Gen Y and X are willing to forego traditional benefits.
Gen Y and X are more cash-strapped than previous generations because of student
loan debt, and many entered the workforce during the Great Recession. In
addition to flexible work schedules, traditional and non-traditional benefits
that are important to Millennials include:
Financial wellness and literacy programs
Student loan repayment assistance
Unlimited PTO plans
Opportunities for advancement
Health and wellness benefits
What you can do to keep Gen Y and Gen X working for you
Company Culture
Gen Y and X want to work for companies that understand and
support their values and understand their differences and the challenges they
face. Generally speaking, generations Y and X are better educated than previous
generations – and a higher percentage of women have degrees than men. But they
also have more student debt. They are more racially and ethnically diverse.
Many delay marriages and creating a home longer, often living with their
parents. More would rather travel and experience the world than buy a home. And
they’re delaying parenthood.
Diversity and
Inclusion
There is a correlation between Gen Y and Xers who want to
stay with their current employer and their belief that the organization
supports diversity and inclusion. How they define diversity and inclusion
varies from typical demographics to ideas/ways of thinking, and tolerance,
inclusiveness, and openness in the workplace, Deloitte’s global survey noted.
Share how your leadership defines diversity and inclusion.
To understand what your workforce values under diversity and inclusion, ask
them. Then develop policies that support these values and train all levels of
employees as these definitions evolve.
Work/Life Balance
These generations often value experiences over financial
gain and possession. However, they also want to be paid for the work they do
rather than work long hours in salaried positions that cause their work/life
balance to suffer.
Because they’re choosing to delay becoming parents, flexible
and work-from-home work options help retain Gen Y and Xers who want to keep
working for you but still be close to their kids.
These generations also want the flexibility to work a
schedule that supports vacation time for travel. And employers are responding:
the State of American Vacation 2018 found that employers are beginning to
encourage vacation cultures and as a result, employees are feeling more
confident about using earned time off. For three years in a row, the amount of
vacation time used increased. Still, 52% of American workers didn’t use up all
their vacation time in 2017. The younger generations are likely to decrease
that number.
Talent Development
Career growth opportunities rank No. 1 on the list of
factors most important to job seekers surveyed for a 2019 report by Jobvite.
The same survey noted only 17% of those who left their jobs within the previous
12 months did so for more money.
Accurate Job
Descriptions
Providing Gen Y and X with clear expectations of their work
begins during recruitment and hiring. A Jobvite study found that 43% of new
hires who left within their first 90 days did so because their job duties were
different than their expectations based on job descriptions and interviews.
Training that Adapts
Nearly two-thirds of employees are concerned about the
impact of AI and robotics on the workforce. Although generations Y and X are a
tech-savvy generation, many feel unprepared for Industry 4.0. They expect their
employer to provide the training they need to be productive and successful.
Just because purpose may be more important to many younger
workers than the size of their paycheck, don’t think that means Gen Y and X aren’t
ambitious: Deloitte found that more than half strive to be high-earners.
They’ll seek out opportunities for training and advancement at work, and if
they don’t find what they want, they’ll move on. They are more comfortable than
other generations in striving for jobs for which they don’t have all the
required skills if training is offered.
Key Takeaways
The great news is that making your workplace more friendly
for Gen Y and X will benefit your employees of all ages. Offering flexible work
schedules and work-from-home options not only appeal to younger workers but
also Baby Boomer caretakers of aging parents and grandchildren. Supporting a
variety of community organizations better ensures your employers will feel you
value what’s important to them. Developing the talents and strengths of every
employee while training them to adapt to ongoing changes in technology
increases productivity and adds to your bottom line.
Are you looking to hire an employee benefits broker and
don’t know where to start? Or have you had the same broker for a while and are
now wondering whether you could do better? Picking the right benefits broker is
challenging, especially because the right partner can have an enormous impact
on your employees and your bottom-line.
You want to work with a company that is not just your
benefits broker, but your trusted benefits advisor. Especially at growing
companies, having expert third-party help is essential to keeping your costs
low and your value-add for employees high. The right benefits broker will not
just sell you on a benefits package and then leave you to figure out the rest.
They will be an HR and Benefits specialist who can help you navigate the entire
benefits process and keep your benefit offerings up-to-date and competitive.
But the stakes are high, and there’s so much to consider –
how do you even get started? Well, luckily this guide is here to help you. We
will examine why it’s important to pick the right broker, and when to hire a
new broker before diving into what you should be looking for in a broker,
including that they provide:
Modern benefits that appeal to your workforce
Cutting-edge benefits technology
Cost savings
Comprehensive employee education
Looking for a Better Benefits Broker: Why and When to Start
Before we dive into what you should be looking for in a
benefits broker, let’s examine the reasons why it is important to choose the
right broker and when to start looking for a better partner.
Why You Should be Picky About Your Benefits Broker
Your benefits broker’s performance will have an enormous
impact on your benefits package’s ability to draw top talent to your company,
encourage your existing employees to deliver their best work, and keep
employees around for the long-haul. These are just some of the reasons why it’s
important to pick the right benefits broker, but let’s look at some specifics.
On a purely numbers level, benefits are a big deal. Benefits
spend is a large part of your overall budget, making up 25-40% of most
companies’ payroll. The right partner will help you minimize those expenses
while maximizing the return-on-investment.
But benefits are never all about numbers; they are
ultimately about people. Your benefits package is one of the most important
parts of your employees’ total compensation package and is meant to help your employees
live a higher quality of life. Your benefits broker should help you craft a
package that meets those needs for the well-being of your employees and your
company. Benefits that are tailored to take care of your employees will
strengthen your company culture and can mean the difference between attracting
and retaining top talent that drives your company’s growth or watching your
best people leave for better offers. Your employees are responsible for your
company’s success, so it’s important to make sure that they are properly taken
care of.
So, when building or updating your benefits package, you
need a benefits broker who will help you balance your budget and your
employee’s needs. Which is why it is important to be choosy when hiring a benefits
broker, and not just stay with the same broker because that’s what you’ve done
in the past. But when is the right time to make a change?
When to Shop for a New Employee Benefits Broker
Many companies overlook the importance of taking a proactive
approach to benefits, frequently staying with the same benefits broker for
years out of habit. That means that employers fall out of touch with the newest
benefits trends, losing the ability to properly evaluate whether or not their
current broker is providing them with the best possible service. That’s
why it’s a good idea to keep yourself apprised of what’s what in the benefits
world so that you can tell when your benefits broker may be underserving your
business.
The decision of what kind of benefits broker you are looking
for, and whether your current broker meets that description, should be based on
a comprehensive review of your company’s mission/vision, culture, short and
long-term goals, and business strategy. You want a benefits broker that will
support each of those elements and help you achieve sustainable growth.
So, the reasons why you may want to look for a new benefits
broker will depend on your unique business needs. That being said, there are
some clear signs that it’s time for a new broker that any business can look out
for, including:
Continuing to pay the same fees while retaining more or less the same benefits package year-over-year
Receiving limited guidance and/or a poor service level from the broker
Going several years without reexamining the broker relationship
Difficulty finding ROI to justify investment in your current broker
Your business and its needs are constantly changing and so
is the benefits marketplace. If you haven’t updated your benefits offering in
quite some time, chances are that you can do better for your employees and your
bottom line by looking for a new benefits partner.
How to Pick the Right Employee Benefits Broker
Now you know why you should take a proactive approach to
your relationship with your benefits broker and what to look out for when
deciding whether or not to look for a new broker. But how do you know which
benefits broker is right for you, once you’ve decided that your current one
isn’t meeting your needs?
Modern Benefits
The last thing you want is a broker who doesn’t stick with
the times and strive to deliver cutting-edge, high-impact benefits options.
Looking for a broker who can craft modern benefits packages will not only help
you compete in today’s market, and offer benefits that even appeal to
Millennial talent, it will also help you find a broker that you can trust long-term.
If a broker is keeping up with the latest and greatest now, odds are that they
will continue to do so. On the other hand, ff they’re already behind the times,
chances are they’ll just continue to fall behind.
What kind of benefits should the ideal broker help you
navigate? Some hot-topic benefits to ask about are telemedicine, financial wellness,
remote work, and other flexible work benefits that will help you compete in the
digital age. Again, even if these benefits aren’t the right fit for your
company now, they might be in the future and a broker who has expertise in building
diverse benefits packages will likely offer other cutting-edge solutions that
you can use.
Another increasingly popular option that the ideal benefits
broker will be able to offer is wellness benefits. These benefits help prevent
lifestyle-related healthcare costs while increasing employee engagement and
quality-of-life. Think of subsidized gym memberships, weight-loss or
smoking-cessation challenges, access to a nutritionist, financial planning,
employee assistance programs, and more. There are so many wellness benefits
that it’s easy to get overwhelmed. The right broker will help you find the
benefits that address your employees’ specific challenges.
Benefits Technology
Technology is an all-too-often overlooked aspect of what sets
a great benefits brokers apart. Software is what makes the world run nowadays,
and benefits are no different.
Benefits technology makes navigating your benefits package
easier for your HR team and your employees. The ideal broker will offer a
benefits portal that makes reviewing and managing your benefits package in one
central location a breeze. This makes it easier for you to plan your benefits
strategy and for your employees to take full advantage of your offerings. It’s
perhaps even more important that your benefits broker provides you with
enrollment software to ease the annual headache that is open-enrollment.
Getting employees enrolled in benefits is one of the hardest parts of the job
as an HR professional, and a streamlined software solution can make open enrollment
as painless as possible for both your HR team and then rest of your employees.
Cost Savings
Of course, one of the main reasons to hire a benefits broker
is to minimize your benefits costs while maximizing your package’s impact on
your employees. That’s why it’s a good idea to hire a benefits broker who will
also serve as your benefits consultant or employee benefits advisor, helping
you craft a strategy that meets your goals and needs.
One of the main ways that brokers can help you develop your
benefits strategy is through data collection. They can provide third-party
health risk assessments (HRAs) and employee surveys to establish demonstrated
employee needs. That information enables you to craft a strategic benefits plan
that keeps costs low while increasing the benefits that matter most to your
employees.
Another cost-saving offering to look out for is a tiered
health plan structure. These health insurance packages allow employees to
manage their health expenses, keeping your costs low while making sure that
employees get the coverage they need. Young and healthy employees to take on
low-premium, high-deductible plans paired with HSAs to keep their upfront costs
low, while employees with families or health risks can opt-in to more
comprehensive plans.
Health savings don’t stop at the plan level, either. The
right benefits broker will help you reduce your prescription drug spend while
making sure that your employees get the medications they need. Drug formularies
can guide employees towards lower-cost, preapproved medications and away from
expensive alternatives. When necessary, benefits brokers can also help you
impose limited restrictions such as requiring employees to try generic drugs
before covering name-brand equivalents. And some brokers will help you cut
costs across the board by offering a prescription savings card as an added
benefit for your employees. These cards can help employees save up to 80% on most
medications.
Education
Your financial investment into your benefits strategy isn’t worth
a whole lot if your employees don’t understand the benefits offered to them.
Your benefits broker can help you provide your employees
with the tools they need to decrease their medical expenses and increase their
wellness to minimize days off and maximize productivity. But if your broker
doesn’t also help you educate your employees about those options then your
employees won’t take advantage of them. As a result, you won’t see those
savings that the broker promised when you when you hired them.
Even by itself, education has a huge impact on your bottom
line and employee welfare. According to a McKinsey survey, engaged healthcare
consumers spend one-third as much as passive consumers. That means that having
a benefits broker who helps you educate and engage your employees can lead to
massive savings for your employees and your company. Plus, helping your employees
become educated, intelligent benefits consumers will allow them to better understand
their own needs.
At the same time, you’re investing a huge amount of money
into employee benefits to reward and engage your employees so that they are
productive, loyal, long-term members of your team. You want to make sure that
they understand all of the benefits that you are offering them and all of the perks
that make your benefits package stand out.
Choosing the Right Employee Benefits Broker: Key Takeaways
We’ve covered a lot in this guide, so let’s take a moment to
go over the key points that you should keep in mind when hiring a benefits
broker:
Benefits are a major expense and a significant investment in your human capital, so it’s important to work with the right broker for your organization
Don’t simply stay with the same benefits broker for years without reexamining the relationship, and be on the lookout for signs that your broker isn’t keeping up with the latest benefits trends
Look for a broker who offers and has expertise in modern benefits such as telemedicine and wellness benefits
Ensure your broker offers software solutions for benefits management and enrollment
See what the benefits broker can do to help you build a benefits strategy and proactively manage your benefits costs
Work with brokers who will help you educate your employees so that they can take advantage of their benefits, fully appreciate the package you offer, and become smarter healthcare consumers
