How to ensure benefits packages stack up

Employee benefits packages are a lot like coffee. Some are Starbucks, touting a gazillion choices, and others are local diners, offering a basic cup o’ joe.

If you’re an espresso aficionado, you expect to be able to customize the roast, type of milk, and sweetener and would be disappointed when those options weren’t available. But if you’re looking for your tried and true drip coffee, you’d be overwhelmed by the sheer volume of choices presented to you at the coffee house.

The key is that employers understand what’s offered, what fits in their budget, and most importantly, what type of benefits their employees want.

Yet we see many employers put together employee benefits packages based on what they assume their employees want or what fits into their budget. And even when they have an enormous budget and offer a huge array of benefits, they’re often left scratching their heads when no one enrolls in them or utilization is low.

Here’s a step-by-step process to ensure an employer’s benefits package stacks up:

1. Meet with an employee benefits consultant to review options

This is the time for employers to educate themselves on what’s available and possible. Ask an benefits consultant to present options for all types of benefits, especially ones that haven’t been considered before. The idea is to start broad and then have leadership narrow the field to a few choices based on cost and complexity of rollout.

It’s also worth mentioning that some benefits could be 100% voluntary. Large organizations often have negotiation power to get a highly-discounted group rate on benefits an employee would have to pay full price on were they to seek them on their own.

2. Poll employees

Once there is a defined set of potential benefit options, employers should create a survey to ask employees their preferences and benefits wish lists. And to make the results more meaningful and helpful, don’t just ask them yes or no questions about each benefit. Instead, show examples of cost implications for a sample population and provide estimated pricing and simple explainer information to inform them about each benefit.

3. Share the results, communicate a multi-year benefits plan, and roll out the new benefits

Once survey responses have been tallied, what matters most to your team will be made clear. And the process may even uncover a few new benefits they hope to have. From this, the employer can work with their advisor to prioritize which benefits will be implemented during the next open enrollment, which will be removed from consideration, and which ones will be offered later. For instance, the two most popular benefits might be rolled out in year one, with a plan to add a few new benefits in year two and then a couple more in year three. Creating and communicating a multi-year strategy won’t create a financial burden on the organization and will show employees that advancements are being made to cater to their needs.

4. Repeat the process annually

The great thing about annually surveying employees is that their wants and needs change over time, so you’ll be able to serve them better as they do. For instance, when they started at the company, they may have been single, but now they’re married or have a child. Continually polling them helps you keep employee benefits package relevant.

5. Don’t forget about continuing benefits education

While benefits surveys are an annual event, communication about using them should be more frequent. Consider monthly themes that tie back to available benefits to keep them top-of-mind with employees and encourage utilization. For instance, May is Mental Health Awareness Month, a perfect time to highlight employee assistance programs (EAP) that otherwise might be underutilized.

6. Get started now — waiting until open enrollment is too late

Off-cycle is the best time to begin this process because it offers the time needed to explore, educate, and survey.

These days, offering an attractive employee benefits package is a non-negotiable, often as important as (if not more so than) compensation, and a point of differentiation that aids in employee attraction and retention.

Though likely one of an employer’s biggest expenses, the cost of not offering a robust employee benefits package is much higher. Changes don’t need to be made all at once; small incremental changes signal to employees that their employer is listening working to meet their needs. Being proactive in the planning process will ensure that employers have a competitive employee benefits package that serves both their needs and those of their employees.

Frank Mengert is the founder of ebm, a leading provider of employee benefits technology solutions nationwide. He challenges conventional wisdom to help benefit consultants gain fresh perspectives that drive them in attracting, winning, and retaining business.