If your employees are thinking about quitting, a strong benefits package might convince them to stay. On the other hand, a poorly planned open enrollment period might push them to quit.
A strong open enrollment period is an important part of any retention strategy. This year, the stakes are especially high.
Workers Are Demanding More
According to the Harvard Business Review, resignations have been abnormally high since peaking in April. In July 2021, 4 million Americans quit, and there were 10.9 million open jobs – that’s a record. It’s not just young workers who are quitting, either. Resignations have been especially high among employees in the 30 to 45 age group.
Right now, employers have a strong incentive to keep workers. HR Dive says that replacing an employee who earns $45,000 might cost an average of $15,000, and turnover can also have a negative impact on productivity.
Good benefits could help employers with their retention efforts. According to Employee Benefit News, a survey from Staples found that more than half of employees said that incentives and perks help improve workplace morale, and almost two-thirds of employees said they would accept lower pay in exchange for better perks. Flexible hours, paid insurance premiums, paid family leave, remote work, and financial assistance with professional certifications were all considered to be must-have benefits by many employees.
Communication Needs to Improve
Many employers are already planning to improve their benefits package. Harvard Business Review states that 98% of business leaders surveyed said they planned to offer at least one new or expanded employee benefit, while Mercer says that employers are expecting their health benefit costs to increase 4.7% as they prioritize better benefits over cost-reduction.
But none of this will help retention efforts if employees don’t get the message.
According to Human Resources Executive, 35% of employees say they do not fully understand the benefits they enrolled in during the most recent open enrollment period. Among younger workers, 54% admit they don’t understand their benefits. And while employers might think it’s the worker’s responsibility to read through the benefits package, two-thirds of employees say they want their employer to help them understand their benefits better.
If employers want their employees to appreciate their benefits, they need to make sure their employees understand their benefits. This year, communication may be especially tricky because some people have returned to the office, but many people are still working from home. HR professionals need to reach everyone.
Getting Open Enrollment Right
This year, getting open enrollment right may be both more important and more challenging than usual. Here are a few key dos and don’ts.
- DO provide benefits that meet the needs of your workers, including core benefits like health insurance and additional voluntary benefits.
- DO consider adding mental health, telemedicine and financial wellness benefits. Also, look for ways to increase flexibility for your team and to help them balance caregiving demands.
- DO tell your workers how their benefits are improving. If your 2022 benefits package is richer than it was in 2021, or if you’re not passing along the increases you received from carriers, let employees know. Don’t assume they’ll notice on their own or understand why the changes are important.
- DON’T assume workers will read dense benefits booklets. Provide online tools, one-on-one meetings, videos, infographic and other resources to help workers understand their benefits. Frequently remind them of timelines and deadlines. Over-communicate.
- DON’T leave out any of your workers. Make sure your open enrollment communications target in-office, remote and hybrid workers. Also, don’t forget COBRA participants.
The Heffernan Insurance Brokers employee benefits team is here to help. Contact us anytime!