With multiple generations working side-by-side in this economy, the needs of your staff in terms of employee benefits will vary greatly depending on their age.
You may have baby boomers who are nearing retirement and have health issues, working with staff in their 30s who are newly married and have had their first kids. And those who are just entering the workforce have a different mindset about work and life than the generations before them.
Because of this, employers have to be crafty in how they set up their benefits packages so that they address these various needs.
But don’t fret, getting something that everyone likes into your package is not too expensive, particularly if you are offering voluntary benefits to which you may or may not contribute as an employer.
Think about the multi-generational workforce:
Baby boomers – These oldest workers are preparing to retire and they likely have long-standing relationships with their doctors.
Generation X – These workers, who are trailing the baby boomers into retirement, are often either raising families or on the verge of becoming empty-nesters. They may have more health care needs and different financial priorities than their older colleagues.
Millennials and Generation Z – These workers may not be so concerned about the strength of their health plans and may have other priorities, like paying off student loans and starting to make plans for retirement savings.
Working out a benefits strategy
If you have a multi-generational workforce, you may want to consider sitting down and talking to us about a benefits strategy that keeps costs as low as possible while being useful to employees. This is crucial for any company that is competing for talent with other employers in a tight job market.
While we will assume that you are already providing your workers with the main employee benefit – health insurance – we will look at some voluntary benefits that you should consider for your staff:
Baby boomers — Baby boomers look heavily to retirement savings plans and incentives, health savings plans, and voluntary insurance (like long-term care and critical illness coverage) to protect them in the event of a serious illness or accident.
You may also want to consider additional paid time off for doctor’s appointments, as many of these workers may have regular checkups for medical conditions they have (64% of baby boomers have at least one chronic condition, like heart disease or diabetes).
Generation X — This is the time of life when people often get divorced and their kids start going to college. Additionally, this generation arguably suffered more than any other during the financial crisis that hit in 2008. You can offer voluntary benefits such as legal and financial planning services to help these workers.
Millennials and Generation Z — Some employee benefits specialists suggest offering these youngest workers programs to help them save for their first home or additional time off to bond with their child after birth.
Also, financially friendly benefits options, such as voluntary insurance and wellness initiatives, are two to think about including in an overall benefits package.
Voluntary insurance, which helps cover the costs that major medical policies were never intended to cover, and wellness benefits, including company-sponsored sports teams or gym membership reimbursements, are both appealing to millennials and can often be implemented with little to no cost to you.
As the economy continues roaring, the market for top talent stays exceedingly competitive. Multiple studies have consistently shown that a robust set of employee benefits is a vital component of an overall compensation package.
But it’s tough for smaller companies to compete with their large counterparts, who have the advantage of economies of scale. As a result, many employers are increasingly turning to voluntary employee benefits, which allow them to provide valued, high-demand benefits to employees at little or no cost to the company.
How voluntary benefits work
Voluntary benefits are arranged by employers but either paid for by staff via payroll deduction or by the employers themselves. Businesses generally set up a menu of options that their workers can select from for themselves, based on their own needs.
The employer deducts any fees or premiums for these benefits from employee paychecks and forwards them in a single batch to the benefit vendors.
Once the employee enrolls in a voluntary benefit plan, payroll services companies routinely automate this process for employers, making ongoing benefits administration hassle-free for small businesses.
And best of all, because premiums and fees are often paid by the employees, even small companies can provide popular and highly valued benefits for little or no cost.
Popular voluntary benefits
There are several types of voluntary employee benefits on the market today, with more innovative new benefits and perks rolling out every year. However, the following are among the most in-demand by employees and commonly offered by their employers:
Dental and vision insurance coverage
Disability insurance coverage
Life insurance — can be term or cash value
Legal assistance/prepaid legal services
Identity theft insurance
Fitness/health club memberships
Long-term care insurance
Financial planning/counseling services
Accident insurance
Hospital indemnity plans
Pharmacy discount plans
Critical illness insurance (e.g., cancer insurance)
Pet insurance.
Employees can often buy these benefits and services via their employer’s group voluntary benefits plan much more cheaply than they could buy them on their own.
Voluntary benefits have been becoming more popular among employers in recent years as unemployment falls. One reason: More employers are offering high-deductible plans as health insurance costs continue to increase.
Critical illness and hospital indemnity policies have seen big gains in enrollment as workers turn to them to help cover those deductibles and copays if they have a costly health event like cancer or another critical illness diagnosis.
According to a recent LIMRA study, seven out of 10 employers surveyed reported that they believe offering voluntary benefits improves employee morale and satisfaction.
A 2023 Harris Interactive poll found that when employers offer voluntary benefits, 55% of workers, on average, report that they are satisfied with their employer’s overall benefit mix. Where the employer did not offer voluntary benefits, the satisfaction rating fell to 32%.
Best practices
Don’t overwhelm employees with too many benefit choices at the same time. Roll them out a few at a time, starting with life insurance, dental/vision and/or disability insurance. These are proven high-participation programs.
Match benefits to your employees’ life stages. Millennials have different needs and interests than baby boomers.
Put effort into your benefits education and communication plan.
Use a variety of different communication tools. Embrace digital and in-person communication, in addition to printed brochures — especially for millennials.
Despite group health plan inflation increasing again in 2024, a new study has found that employers continue staying the course in not shifting costs to employees who may already be overstretched by inflation and medical bills.
Instead, 64% of employers say they are looking for ways to boost their health and well-being offerings to better meet employee needs, according to Mercer’s “Survey on Health & Benefit Strategies for 2024 Report.” That’s on top of the 25% who said they had already enhanced their slate of benefits in the last two years to better attract and retain staff and meet employees’ needs.
With health care costs expected to jump 7% this year from the 2023 level and insurance premiums reflecting that increase, many employers will be challenged to balance benefit options with cost-controlling measures, according to the report.
“Employers are looking to enhance benefits, but they need to do it carefully. Not by adding bells and whistles, but by looking for opportunities to add value,” Mercer wrote in its report. “Sometimes that means filling gaps in current offerings with more inclusive benefits. It might mean revisiting time-off policies to give employees more flexibility.”
With significant cost-shifting off the table for most employers, employers will have to get creative to meet the challenge of offering benefits that workers want and need, and health care they can afford, while also managing cost growth.
Addressing employee costs
Some tactics employers are using to boost affordability for their staff include:
Offering at least one free employee-only coverage in at least one medical plan.
Making larger health savings account contributions to lower-paid employees.
Using salary-based contributions, with lower-wage staff paying less than those earning more.
Offering programs to help employees manage specific health conditions.
Taking action to address the cost of specialty prescription drugs.
Focusing on virtual care.
Steering members to quality care with a navigation or advocacy service (beyond the health plan’s standard service).
Limiting plan coverage to in-network care only (in at least one plan).
Other benefit enhancements
Employers are also looking at enhanced benefit options, such as:
Support for women’s health — According to Mercer, 46% of employers plan to offer benefits or resources to further support women’s reproductive health, up from 37% last year.
This includes:
Preconception planning.
Menopause benefits (the percentage of employers planning to offer menopause support has more than tripled since last year’s survey).
Lactation help resources.
Post-partum depression resources.
Childcare benefits and resources — Employers can help support caregivers for the long term with flexible hours and family leave and time-off policies. Some employers also provide subsidized childcare benefits.
Increasing employee flexibility — More employers are also offering paid time off for all kinds of families (like those with LGTBQ parents). Other options being offered include:
Hybrid work options (80% of employers offer or plan to offer these),
Paid time off to volunteer (49%),
Remote work options (47%), and
Four-day workweeks or consolidated schedules (22%).
The takeaways
With group health plan costs continuing to increase amid a highly competitive job market, employers need to take a balanced approach to their benefit offerings, while being mindful of the increasing out-of-pocket expenses their employees may face when accessing health care.
Your decisions in also offering enhanced benefits will obviously be based on your budget, but also on your employee population. Call us to discuss options.
As a record amount of U.S. workers struggle with mental health issues and stress, more employers are offering new chatbot apps to help them.
A survey this past summer of 457 employers by Willis Towers Watson found that 24% of them offer a “digital therapeutic” for mental health support.
Some 15% of the businesses surveyed were considering adding this type of offering in 2024 or 2025, the professional services company found. Typically, these apps are provided as a voluntary or wellness benefit.
Some apps feature chatbots that can hold counseling-type conversations with users, while other wellness apps can help diagnose depression or identify people at risk of harming themselves.
At the same time, these chatbots and other mental health apps have generated controversy, with some experts warning that they are not equipped to handle serious mental health issues and that they are no replacement for human therapists.
However, as long as there are not enough therapists in the U.S. to meet demand and artificial intelligence continues to evolve, it’s likely these chatbots are here to stay.
Examples
Recently Amazon announced that as part of its employee benefits package it would offer the therapist-like app Twill. The platform says that Taylor, its clinician-trained chatbot, “learns, interprets and understands each person’s needs and goals to guide them towards personalized care.”
Another product on the market is Wysa, an AI-driven app that received a breakthrough designation by the Federal Drug Administration, putting it on track for fast-track approval. This came after an independent peer-reviewed clinical trial, published in the Journal of Medical Internet Research, which found the app to be effective in the management of chronic pain, and associated depression and anxiety.
Also on the market is Woebot, which combines exercises for mindfulness and self-care (with answers written by teams of therapists) for postpartum depression.
Pros and cons
The apps vary in how much they incorporate AI — and in how much leeway they give AI systems. These companies say they build safeguards into their apps and that they have certified psychiatrists that oversee the applications.
Proponents of mental health apps and chatbots say they can address issues like anxiety, loneliness and depression. Also, chatbots and apps can provide 24-hour support and they can meet the demand of people who may have a hard time finding a counselor or fitting therapy into their schedule.
On the other hand, there is a paucity of data or research showing how effective, or how safe, they are — and the majority have not been approved by the FDA.
Many of these mental health apps have different specialties, for example: treating anxiety, attention-deficit/hyperactivity disorder or depression. Others can help diagnose mental health problems or predict issues that can lead to self-harm.
Often, the apps will include disclaimers that they are “not intended to be a medical, behavioral health or other health care service” or “not an FDA-cleared product.”
Also, there have been concerns raised about some of these apps. In March 2023, the Federal Trade Commission reached an $8 million settlement with BetterHelp, an app counseling service, over allegations that it shared user data with advertising partners.
Another company, Replika, updated its app last year after users complained that its chatbot engaged in overly sexual conversations, and even harassed them.
The takeaway
Mental health care is an increasingly important part of employee benefits offerings. Since the onset of the COVID-19 pandemic, 94% of employers have made investments in mental health care, according to research by Mercer.
As these apps improve and become more widespread, it’s likely your employees will encounter them when they use their group benefits, or they will be among your voluntary benefit offerings.
The Equal Employment Opportunity Commission has issued proposed language to update its guidance on harassment in the workplace.
The proposed guidance “reflects notable changes in law, including the Supreme Court’s 2020 decision in Bostock vs. Clayton County (which held that LGBTQ individuals are protected from workplace discrimination under Title VII), the #MeToo movement and emerging issues, such as virtual or online harassment,” the EEOC wrote in its introduction to the proposed guidance.
The agency polices discrimination in American workplaces, and harassment falls under that banner. Between 2018 and 2022, 35% of the charges of employment discrimination filed included an allegation of harassment based on race, color, national origin, religion, sex (including pregnancy, sexual orientation and transgender status), age, disability or genetic information.
Employers should read the guidance to understand the many forms of harassment — and in particular harassment against any LGBTQ workers, since they are the most recent group to receive protected status.
LGBTQ harassment
The Bostock ruling found that harassment based on sexual orientation and gender identity, including how identity is expressed, constitutes sex-based discrimination. According to the EEOC, guidance this type of harassment can manifest in the workplace via:
Physical assault;
Epithets regarding sexual orientation or gender identity;
The denial of access to a bathroom or other sex-segregated facility consistent with the individual’s gender identity;
Intentional and repeated use of a name or pronoun inconsistent with the individual’s gender identity (which is known as “misgendering”); or
Harassment because an individual does not present in a manner that would stereotypically be associated with that person’s gender.
The guidance provides examples that illustrate the many nuances of harassment.
In its guidance, the EEOC cites the following example of indirect LGBTQ harassment:
“Keith and his colleagues work in an open-cubicle style office environment, and they frequently make derogatory comments about gay men and lesbians.
“Horatio, who is gay, overhears the comments on a regular basis and is offended by them, even though they are not directed at him.
“Based on these facts, the conduct is facially discriminatory and subjects Horatio to harassment based on sexual orientation (which is a form of sex-based harassment), even though he was not specifically targeted by the comments.”
It also offered this example of harassment based on gender identity from a case in Philadelphia:
“Jennifer, a cashier at a fast food restaurant who identifies as female, alleges that supervisors, coworkers, and customers regularly and intentionally misgender her.
“One of her supervisors, Allison, frequently uses Jennifer’s prior male name, male pronouns, and “dude” when referring to Jennifer, despite Jennifer’s request for Allison to use her correct name and pronouns; other managers also intentionally refer to Jennifer as “he.”
“Coworkers have asked Jennifer questions about her sexual orientation … and asserted that she was not female. Customers also have intentionally misgendered Jennifer and made threatening statements to her, but her supervisors did not address the harassment and instead reassigned her to duties outside of the view of customers.
“Based on these facts, Jennifer has alleged harassment based on her gender identity.“
What you can do
The EEOC recommends that employers create an effective anti-harassment policy, which is widely disseminated, and that:
Defines what conduct is prohibited.
Requires that supervisors report harassment when they become aware of it.
Offers multiple reporting avenues for an employee, during both work hours and other times (weekends or evenings).
Identifies accessible points of contact to report harassment (complete with contact information).
Explains the employer’s complaint process, including the ability to bypass a supervisor, along with anti-retaliation and confidentiality protections.
For an employer’s complaint process to be effective, at a minimum, it should provide:
For prompt and effective investigations and corrective action;
Adequate confidentiality protections; and
Adequate anti-retaliation protections.
The final step in it all is training your employees and supervisors on your anti-discrimination and harassment policy. You can use the EEOC guidance to provide examples of harassment and provide information about your employees’ rights if they experience workplace harassment.
Supervisors and managers should receive additional training, including the importance of taking complaints seriously and not retaliating against anyone who makes a complaint.
A new study has found that most employer-sponsored family health plans are increasingly unaffordable for workers due to rising costs and them footing a significant part of the premium, even with employer assistance.
Workers at smaller firms, defined as those with fewer than 200 employees, are especially affected as they typically have to pay a larger share of the family coverage premium than their large-employer counterparts (38% vs. 25%), according to the 2023 Kaiser Family Foundation “Employer Health Benefits Survey.”
The amount workers at small firms pay for single-only coverage is comparable to what their counterparts at larger firms pay (17% of the premium vs. 18%).
While family-plan premiums are similar for workers in small and large firms ($23,621 compared to $24,104 on average), due to the higher percentage cost-sharing, employees in small firms are paying significantly more for their share of the premium ($8,334 per year vs. $5,889 at larger firms), according to KFF. Moreover, 25% of workers at small firms pay over $12,000 yearly for family coverage, excluding deductibles that are also often higher.
For low-wage workers that’s a tall order, made worse by the fact that those at small employers typically earn less (an average of $44,600 a year vs. $63,200 for workers at larger firms).
On top of higher premium layouts, workers in small firms may also pay higher deductibles and have higher out-of-pocket medical costs:
About 59% of employees in small firms have a family-plan deductible of at least $3,000 before the plan will start covering most services.
Some 34% of workers in small firms have a family-plan deductible of at least $5,000, and it may be higher if multiple family members have to spend towards the deductible during the plan year.
What small firms can do
While small employers really can’t do anything about rising group health plan costs, they can take steps to ease their employees’ premium obligations and out-of-pocket costs:
Assume more of the premium — If it’s within their budget, they can increase the amount of family coverage premium they will cover. This is not something that is feasible for many companies, but for those who are interested in attracting and retaining talent who have their own families, they may need to.
Offer more plans with narrow networks— Narrow networks do reduce premiums, and that’s a huge draw for both employers and their employees. But consumers also benefit from these plans through lower overall out-of-pocket expenses.
Narrow networks contain longer-term costs by encouraging individuals to develop a relationship with their primary care providers. Cost savings come from increased use of PCPs and decreased, or more-efficient, use of specialists.
These plans provide a way to contain costs without sacrificing care, but because they’re comprised of local, community-based medical providers they’re best for a workforce that works at a single location and therefore lives within proximity to the job site/office.
Offer high-deductible health plans — A high-deductible plan’s upfront costs are less expensive than a preferred provider organization or health maintenance organization. According to KFF, the average HDHP family coverage costs $22,344 a year, nearly $3,000 less per than a PPO plan and nearly $1,500 less than an HMO.
With that lower premium, employees can set aside additional funds into an attached health savings account, a tax-benefited vehicle that is funded through pre-tax payroll deductions. HSA funds can be used to reimburse for health care expenses, including those towards deductibles.
