Growth can be an exciting time for an organization, but change can also create anxiety among employees. Whether the change is an acquisition, organic growth or new hires, managing your company’s benefits during the change process and after it has occurred is critical. Changes affecting benefits are especially important, since benefits are approximately 30 percent of an employee’s compensation, according to the Bureau of Labor Statistics – a key factor in employee retention.
HR’s management/communication about change are essential to getting employee buy-in and achieving success. Here are four ways to effectively manage your benefits during a period of organizational growth:
1. Consider the impact to employees at every level. As companies change, they must be able to address various staff levels, compensation and an evolving organizational hierarchy. Structuring benefits that address employee classification levels is crucial. Many organizations aren’t aware that they can segment their employee population around benefits, particularly as a supplement to compensation. Classifications include full-time vs. part-time, geographic location, current vs. former employees, etc. HR professionals must assess how benefit plans will affect every new person hired, and how they should be adjusted as the company grows.
A benefits philosophy that addresses the attraction and retention needs of the organization is an often-overlooked step by most organizations.
2. Enlist a consultant to help. An experienced consultant can drive conversation around employee benefit plans and optimization. Further, outsourcing benefits administration allows HR to focus more on strategy. A benefits consultant can help with communication, and along with legal counsel, ensure you stay compliant. The right consultant will take the time to get to know your organization and stay engaged as they fine-tune plans to meet changing needs. Your benefits consultant needs to have tools and resources to provide advanced advice to forecast and set projections. Growth can be complex as it often must be managed across locations with various constituents – benefits advisers can drill down to a granular level of employee data to provide insightful information for this process.
3. Set a benefits philosophy that aligns with your mission, vision and values. Having a solid foothold on your company’s mission, vision and values is essential and should be top of mind when crafting your benefits strategy. A benefits philosophy that addresses the attraction and retention needs of the organization is an often-overlooked step by most organizations – benefits tend to evolve from legacy decisions.
4. Provide employee education opportunities. Employee education and communication are always high on HR professionals’ list of priorities. The key is to be budget-minded and balance cost with quality benefits. Education around how to use the plan, how it benefits employees and the options that are available should be part of the conversation with each employee. In the current age of health care consumerism, employees have increased purchasing power and latitude to make decisions.
The most popular form of consumerism includes the use of insurance with some form of personal account, such as a Health Saving Account (HSA), Health Reimbursement Arrangement (HRA) and Flexible Spending Account (FSA). Consumer-driven health care always includes a High Deductible Health plan (HDHP), and in some instances, these health care consumerism benefits can lower costs. Let your employees know what your company offers and help them decide which plan is best for them.
5. Maintain a consistent, comprehensive benefits strategy as the organization evolves. Open enrollment is obviously the most critical period for organizations to make decisions regarding benefits and communicate with their employees, but the problem is that most companies stop there. Failing to continue to promote company benefits throughout the year is a missed opportunity. A comprehensive benefits strategy considers employee wellbeing from a holistic perspective – communication, development, health, rewards, recognition, welfare and compensation. HR should consider touchpoints like webinars and newsletters to disseminate information about the benefits landscape and pertinent legislation with greater frequency than open enrollment.
In addition, meeting regulatory standards becomes more complex as organizations are required to meet different criteria as they grow. A seasoned, well-prepared consultant can help companies forecast the impact of their growth or acquisition.
Change can be a difficult process, but an experienced team of consultants can make it much easier. Strategic planning, thoughtful and thorough employee education and informative data enables companies to make the right decisions for their businesses and prepare for the future.