by Julie Tuggle-Nguyen
Human Resources professionals are busy at year-end, striving to set up our teams and the organization we serve for success in the coming year. HR teams are preparing the organization for the next round of open enrollment, after months of negotiating with vendors and making sure the details of benefit plans are buttoned down and ready to roll out. We are working on our employee communication plans so our teams understand what is available and where they can go with any questions. We know a strong benefit package can be a key differentiator for attracting and retaining talent, but we also know that benefits are one of our biggest expenses. How do we balance one against the other?
The goal is to contain costs where you can and make sure that how you spend your budget gives you the most bang for the buck.
I have lived through a fair share of year-end reviews as an HR leader and humbly offer these thoughts about how to best unleash the power of human resources to contribute to the bottom line during this season.
- Prescription drugs: These make up a huge cost and are a big risk for small companies. Make sure you are asking questions around ever-changing laws regarding everything from where your benefits provider can source prescription medicine to how your rebates are structured. How your contract is written and what it provides for you are critical to understand and to make sure the contract is being fulfilled. This can have a dramatic impact on costs.
- Communications: If this is the year you are making significant changes or just looking for a reason to be out with the team, you may want to plan Open Enrollment sessions, pop- in visits with teams, or depending on your size and location, a walk around the office handing out reminders and taking time to have conversations with your employees. Many of your vendors may offer small “leave behinds” that you can add to a gift bag along with essential information. Reminders to your team throughout the enrollment period will help ensure they submit their information before the deadline.
- Medical Benefits: No matter your size, this is likely one of the biggest expenses to hit your bottom line. Your relationship with your benefits vendor should be strong and based on open communication. If your vendor is not a trusted partner, find a new one. Your vendor should be bringing you options regularly for consideration to help you manage your costs (e.g., participation in a “captive,” a new structure for plans, new options with one-stop shops for all your medical needs, etc.) Understanding every option available to you is key to finding solutions that fit your employees and business needs. There are no stupid questions, and if you aren’t getting what you need, find someone else.
- Dependent audit: Depending on your company’s size, it can be a good practice to conduct an audit of dependents covered under each employee’s plan. For example, have any dependents aged out the coverage range or moved onto their other parent’s policy? Has someone’s marital status changed? Often your benefits provider will help with the audit because up-to-date information can potentially save them money, too.
- Differentiators: I suggest that you continue to evaluate and explore which benefits are attractive to your employee base. Changing workforce demographics and what is important to them ideally dictate how to consistently align benefit packages to those we serve. For example, differentiators might include:
- Flexible dependent and medical saving accounts that allow employees to set aside pre-tax income to apply to childcare costs or medical expenses.
- Long-term incentives.
- A profit-sharing plan that pays out based on company performance can help focus the workforce on a set of key metrics and engage the entire workforce in achieving those goals.
- 401k plans demonstrate a long-term commitment to your employees. Items to consider include company match and vesting period.
- Paid maternity/paternity leave if you don’t already offer it
- Alternative work schedules that can be tailored to meet the needs of individual employees and the business.
- A trend getting a lot of press right now is the four-day work week. This option is interesting but not for everyone.
- Before adopting any changes, make sure they’re a good fit for your business.
- Small stipends toward daycare expenses, gym memberships, smart watches, or exercise equipment, which don’t have to be costly, but can be very attractive
HR professionals are juggling a myriad of options as they balance the costs of benefits. The investments made during this busy season will help to create a culture of success and engagement and will benefit your team and organization in the long run.
Julie Tuggle-Nguyen is EVP of Human Resources, Midwest BankCentre.