The Benefit Plan - You’ll gain from explaining its value to your workers
Edie Evans says there are two things she wants to know when she interviews for a job. “I want to know how much it pays and how much time off I get,” says Evans, who is a secretary. She admits that those are what matter to her most.
Apparently, others share her opinion. A survey of 1,542 workers conducted by MetLife shows that while employees recognize the importance of health-care insurance, pension plans and disability insurance, the benefit they value most is paid vacations. The survey found that while 63 percent are worried about just making ends meet, 64 percent identified vacation time as their most valuable benefit. “When you start talking about benefits, I think it’s easy for people to get confused and concerned,” says Craig Guiffre, a MetLife senior vice president. “There’s so much out there they probably don’t know where to turn, so they turn to what is easy.”
In some ways, the short-term view of benefits employees have is similar to the short-term earnings perspective that some corporate executives possess. Guiffre says most companies, even those that offer generous and broad benefits programs, are often vague about their value to workers. Those companies wait for employees to recognize the value of their benefits and appreciate them. Unfortunately, sometimes that doesn’t happen. MetLife reports that 49 percent of workers think their employer’s share of medical insurance expenses is less than $2,000 a year. In actuality, a report from the Kaiser Family Foundation and Health Research and Educational Trust says companies nationally pay an average of $3,137 to cover individuals and $7,289 for families.
“Employees often have an unrealistic view of what benefits really cost,” Guiffre says. “I think employers really need to work on ways they can educate workers so they appreciate those benefits.” And when workers start valuing paid vacations ahead of the long-term security that pension plans offer, well-intentioned companies don’t get the payback for the benefits they offer.
Guiffre says it becomes incumbent on employers to educate workers in a more efficient manner. One way to do that is to specifically target groups within the work force and make them aware of the benefits that apply to them. A young couple with children under the age of 3 has different benefit needs from a mid-career worker who needs tuition assistance or a worker who is nearing retirement age. “I think we need benefits programs that are more structured, that identify life stages and have benefits that are timely,” Guiffre says. “If you start to do that, workers see more value in their benefits and are more likely to use them.”
In the case of Evans, she says she knows she should be saving for college for her two children, ages 10 and 12. Yet she doesn’t even know if her employer offers counseling for that. “I guess I should ask,” she says.
Guiffre thinks it shouldn’t be left to chance. The company should actively try to determine the needs of its workers and show them benefits that pertain directly to them. Because a surge in baby boom retirements will shrink the labor force in the years ahead, Guiffre says employers will have to offer better benefits to attract and retain good workers. At the same time, they are fighting a constant battle to control benefit costs. “Education of workers becomes a smart choice,” he says. “Employers will be able to maximize the benefits they have if employees are aware of them. And from the perspective of the worker, the job becomes more valuable and important because the benefits mean something to them.”
By Michael Kinsman