Organizational Wellness

How to Optimize Your Employee Benefits Strategy

Last Updated Sep 19, 2024

Benefits: Who doesn't love them? Almost everyone would jump at the chance to have quality healthcare, a flexible vacation plan, and a strong wellness program. And the data backs this claim up: Approximately 70% of workers indicate that benefits significantly affect whether they accept a job offer or stay with an employer long-term, according to WEX. In other words, if company benefits don't meet employees' needs, they're more likely to check out the competition.

Several factors impact an organization's ability to offer great benefits, including its budget. However, even if a company doesn't have an unlimited budget for employee benefits, there are ways you can support your employees without breaking the bank. Here's how to optimize your employee benefits strategy to attract and retain top talent.

Assess Employee Needs

When reviewing your benefits plans, get a feel for what employees actually want. There's no reason to pay for benefits that few employees use! Doing so drains your benefit budget and may not provide workers the support they seek. Consider implementing a few strategies to understand your employees' needs so you can better align your offerings to meet them.

Collect and Analyze Employee Data

You can better understand your employee's benefit preferences by considering their circumstances. Take a look at some of the existing data you have from various sources, like their current benefit opt-ins, payroll data, and employee files, to understand their family size, age, location, and other factors. Such data can help you brainstorm ideas for fantastic benefits your team will appreciate.

For instance, if most of your workforce consists of millennials with young children, a great health care plan is probably pretty critical to them. You might subsidize their entire premium so everyone has access to the plan. Other benefits for families that can help you stand out include paid maternity and paternity leave, daycare assistance, and flexible working hours.

On the other hand, older workers may be looking for better retirement plan options. You could meet their needs by increasing your retirement contribution match or offering financial planning assistance.

Conduct Employee Surveys and Focus Groups

While you can guess what benefits your employees might want, the best way to learn what workers want is to ask. Consider sharing a survey of questions related to employee benefits. In your employee benefits survey, you can ask what employees think about your current benefit options and where you might improve. Inquire about which benefits missing from your current options would bring them value.

Employees may not always be aware of the types of benefits available. While health care and retirement plans are pretty universal, other benefits like adoption and student loan assistance aren't as commonplace. Including questions concerning an employee's overall wellbeing, including physical and mental wellness, can help you understand where you can level up your benefits strategy.

You could also run a few focus groups to understand what your employees want. A focus group lets you talk directly to employees to learn what they want from their benefit options. If you elect to hold a focus group, ensure you invite workers with an array of perspectives that best represent the composition of your workforce.

Analyze Industry Trends and Competitor Offerings

Companies consistently update their benefit offerings to attract top talent and retain existing employees. They find ways to improve their plans and stand out in their industry. Thus, it's a good idea to stay on top of new employee benefits trends through resources such as the Society for Human Resources Management (SHRM). You may also benchmark your offerings against local competitors to identify potential areas for benefit improvements.

Align Benefits with Company Culture and Values

Your company's culture plays a big role in the benefits your organization offers. Ideally, you want to provide benefits that align well with organizational values.

Reflect Company Culture

Think about your company culture and organizational values. What ideals does the organization support? Examples include work-life wellness, diversity and inclusion, or innovation. You can select benefits that neatly tie into those values, helping to solidify the company culture.

For instance, if your company prioritizes work-life wellness, offering a flexible work schedule or hybrid options would align with organizational values. Or, if you emphasize innovation and out-of-the-box thinking, you might provide professional development benefits or tuition reimbursement. Companies that value diversity and inclusion may offer expanded medical coverage for LGBTQ+ families or domestic partners.

Support Employee Wellbeing

Many employees seek more from their employers than a standard benefits plan of medical care, vacation, and retirement plans. They want benefits that support their overall wellbeing, including physical, mental, and financial health.

Consider your current benefits and whether you provide options for every wellness category. For instance, perhaps you offer a terrific health plan, but you could support employees even better by providing free access to local gyms or online fitness classes. Or, maybe your employees could use help managing work stress and would benefit from access to mental wellness apps or additional PTO.

Encouraging Work-Life Wellness

It used to be that long hours at the office were a fast track to a promotion or executive role. That isn't so much the case today. Today's employers recognize that employees perform better when they have downtime away from the office, where they can spend time with family, friends, and on their hobbies. Too much time at the office can lead to burnout, where productivity as well as physical and mental health decline drastically.

Approximately 93% of employees believe their wellbeing at work is just as important as their salary, according to Wellhub data. Employees are more likely to look for another job if they don't feel an employer cares for their overall wellness. You can support your employee's desire for comprehensive work-life wellness by offering benefits that support their wellbeing inside and outside the office.

Consider including benefits that promote time away from the office. Some companies offer unlimited PTO or vacation time that exceeds the standard two weeks off. You might also allow employees to set their own hours or work primarily from home. Think about the needs of the business and how such options might be a low-cost alternative that improves talent retention.

Get More Out of this Employee Benefits Series:

What Benefits Do Employees Value Most?

Employee Benefits Guide for HR Leaders

Top 6 Employee Benefits Trends for 2024

How to Build an Inclusive Benefits Plan That Supports Every Employee

HR Guide to Benefits Strategies That Attract & Retain Top Talent

How to Build a Competitive Benefits Package that Wins You Top Talent

Why Are Benefits Strategically Important to Employers Today?

Strategic Benefits Strategy for Employee Retention and Engagement Long-Term

Maximize Benefits ROI: Data-Driven Strategies for HR Leaders

Offer a Comprehensive Benefits Package

What does a holistic, broad benefits package look like for organizations? It includes a variety of benefits suited to meet an employee's physical, mental, and financial wellness needs. Here are some examples of benefits you may include in a comprehensive benefits package.

Core Benefits

Some benefits are so commonplace that employees expect them from their workplace. Provide these benefits to avoid automatically putting your organization at a disadvantage. Examples of core benefits include:

Medical insurance

Health care is an essential benefit for all employees, regardless of age. Without health insurance, a single visit to a physician can set an employee back several hundred dollars, and an unexpected health emergency can run into the tens of thousands of dollars.

You can offer your employees a range of healthcare plans, including a Health Maintenance Organization (HMO) or High-Deductible Health Plan (HDHP). Other components of comprehensive medical care include dental and vision insurance.

Retirement plan

A company-sponsored retirement plan allows employees to set aside a portion of their earnings for retirement and usually offers some tax advantages. You may offer a company match to give your employees an extra incentive to save for retirement.

Paid time off

All employees need time away from their office, as doing so can help prevent burnout and keep employees engaged during their work time. You may choose to provide the standard two-week paid leave or expand your offerings to include additional types of leave, such as a paid sabbatical, mental health days, or unlimited PTO.

Wellness Benefits

A wellness program aims to provide comprehensive benefits addressing employee physical, mental, and financial wellbeing. Most wellness programs try to improve employee productivity and engagement while attracting top talent and retaining key employees. Some types of wellness benefits that are gaining traction among employers include:

Tuition reimbursement
Flexible work schedules
Hybrid or remote work options
Access to mental wellness programs, such as yoga or mindfulness classes
Gym memberships or paid fitness classes
Nutritional education programs
Financial counseling

Flexible Benefits

Offering flexible benefit options allows employees to customize their plans to fit their needs. That way, they only pay for the benefits they'll actually use. Some types of flexible benefits you may provide include:

Flexible spending accounts that allow employees to set aside pre-tax earnings for medical or dependent care
Commuter benefits, such as reimbursement for parking or using public transport
Professional development stipends for certifications or advanced education
Assistance with financial planning needs, including estate planning or debt management
Optional stipends for work-related devices like laptops and smartphones

Emerging Benefits

Some employers are starting to offer a few innovative benefits, such as assistance with repaying student loans. Other 2024 benefits trends include pet insurance, which covers the cost of vet visits and pet emergencies, and floating holidays. Under a floating holiday plan, employees can take a day off for a special occurrence, such as a birthday or a religious holiday.

Another emerging benefit option is support for aging parents. Some employees may be caring for elderly relatives, which can be time-consuming and expensive. You may offer extended support to meet caregiver needs, such as additional paid time off or setting up an employee resource group.

Communicating and Educating Employees

Since benefits can be wide-ranging, and employees may be unfamiliar with the ins and outs of all their options, setting some time aside to explain benefits and answer questions can make a real difference to your team.

Clear and Transparent Communication

Most companies update their benefit plans annually. Once your organization solidifies benefit options for the year, try scheduling an all-hands meeting or conference to explain changes in your offerings. You might record the meeting for employees who cannot attend so they can review it in their free time. Make sure to allot additional time for employees to ask questions.

Utilizing Technology

You can lean on technology to improve the employee experience during benefit enrollment in various ways. Consider using technology to allow employees to select their benefits for the year. Some HRIS and ERP systems include benefit enrollment functionality, allowing you to record and track employee benefit selections.

Another way to incorporate technology and streamline the benefit process is by recording short explainer videos so employees understand their options. Explainers are especially helpful for complex benefit choices, such as health care and retirement plans. Plus, you can save them to share with new employees who join your company later in the year.

Provide Ongoing Education

Your employees may appreciate additional assistance in understanding the organization's benefit options. That's especially true for new, younger hires unfamiliar with how particular benefits work. For instance, if you offer several types of health care insurance, you could hold a webinar or workshop to explain each in detail so employees can see how they work. That way, they're better positioned to choose the right plan for themselves and their families.

Another area where ongoing education is helpful is retirement planning. Approximately 60% of adults worry they don't have enough retirement savings to support themselves in retirement, according to research from AARP. By explaining how your company's retirement plan works — and why it's so important to contribute — you may convince more employees to participate.

Measuring and Evaluating Benefits Success

As you introduce employees to your new, optimized benefits plan, keeping track of participation and enrollment is vital. That way, you will know whether your employees like the benefits, or if it might be worth investigating other options.

Track Key Metrics

There are several metrics you can monitor to evaluate benefits performance.

Benefits Utilization: The benefits utilization rate tells you how many employees are signing up for benefits and which are the most popular among your team. High benefit utilization tells you employees like the benefits, while low utilization may indicate the benefits don't align with what workers want.
Employee Satisfaction: Consider asking for feedback from employees concerning your organization's benefit plan. You can share anonymous surveys to gather insights from your team. You might include some space in your survey for employees to share their thoughts about the plans in their own words so you get clear and actionable feedback.
Return on Investment (ROI): Many organizational benefits, such as insurance and retirement plans, come at a cost. Carefully monitor company expenditures against the return you see from offering the benefits. Benefits that don't provide a positive ROI may not be worth keeping.
Employee Turnover: While turnover rates may rise for several reasons, they can indicate your compensation or benefits package isn't up to par. If you notice an increase in employee turnover, try to understand why workers are leaving. If it's because of lacking benefits, take action quickly to avoid losing more workers.

Using Data to Inform Future Decisions

Monitoring the success of employee benefit options is a continuous, ongoing process. As your staff's needs change and new types of benefits trend among your competitors, you may need to make additional updates to your program.

Think about making benefit optimization a regular part of your HR processes. You might schedule certain benefit activities, such as conducting employee surveys or focus groups, at specific times each year. You may also routinely survey other employers to track changes in their benefit options so your organization remains competitive.

An Optimized Benefits Plan Supports Employee Wellbeing

Today's employees want to work for organizations that recognize the importance of employee wellbeing and provide a comprehensive benefits package to care for their physical, mental, and financial health. By optimizing your benefits plan to align with your workers' needs, your company stays one step ahead of your competitors, making attracting and retaining top talent easier.

Wellhub makes it easy for employers to offer a holistic benefits package that includes features to support employee wellness. Our customizable plans include access to thousands of popular fitness facilities and apps designed to track activity or relieve stress.

To explore how Wellhub can help you optimize your benefits offerings, speak with a Wellhub Wellbeing Specialist today.

Company healthcare costs drop by up to 35% with Wellhub! (* Based on proprietary research comparing healthcare costs of active Wellhub users to non-users.) Talk to a Wellbeing Specialist to see how we can help reduce your healthcare spending!