I recently heard a business owner describe his company’s voluntary benefits package as a “nice to have.” If that’s the case, I say get rid of the package and save both the aggravation and administrative cost.

If you’re going to offer voluntary benefits, those benefits should be a fixed part of your employment package — part of the ala carte set of options an individual is entitled to as a result of working for the company. People don’t call a 401(k) plan a “voluntary” benefit. Why, then, should an optional life, disability, vision, and dental package be thought of as “voluntary”?

Voluntary benefits are part of a comprehensive benefits package; choosing to take advantage of them is simply optional.

Employers seek satisfaction and productivity from their employees. In our current “jobless recovery” economic environment, productivity is high, but satisfaction is low. The employer is in a quandary because cash flow is tight, so satisfaction cannot be bought through additional compensation. This is where voluntary benefits can prove so useful.

A 2010 study by SHRM found that job security and benefits are the top two motivators of employee satisfaction. In fact, benefits have ranked in the top two since 2002. The challenge is to help voluntary benefits be perceived as benefits. If they’re simply marketed as a “nice to have,” they won’t be valued and, most importantly, won’t enhance employee satisfaction.

Employers should focus on some key elements in designing and offering a voluntary benefits program. These ideas don’t add cost; they simply require attention and some effort.

Choose those benefits that are most valued by the most employees. Medical, dental, life, vision and disability insurance are the standard benefits sought by employees. They deal with contingencies outside the control of most individuals. Depending on the nature of the company’s work force, it may be productive to consider other benefits such as long-term care, critical illness and even legal services. These may fit, but there’s little value in offering them simply because they’re cute, catchy, or in demand by a vocal minority.

Limit the benefits to those that can be understood and appreciated by most employees. I’ve seen companies’ intranet pages packed with goodies and perks available through the employer, but the trouble is that they tend to marginalize the truly useful benefits. Should voluntary dental really be listed next to movie-ticket discounts simply because of their proximity in the alphabet? A better way to assure employee satisfaction is to identify items that are part of the benefits package, then help employees understand how valuable they are.
Educate employees about both the need for benefits and how to obtain them. In addition to offering voluntary benefits, advisors have begun providing tools to identify and quantify the need. For example, one carrier not only offers life and disability insurance; it also provides a simple internet-based program to help employees figure out how much is needed. From the employer perspective, just because the benefits are voluntary doesn’t mean they’re not needed. Educating employees on the costs of uninsured losses is key to employee satisfaction. Know the need to protect the need.
Time spent providing voluntary benefits is time saved. We occasionally hear an employer complain about the time lost in hosting employee benefit meetings. A good case can be made that hosting these meetings actually represents time saved. Employee stress costs employers an estimated $300 billion per year in absenteeism, lower productivity, employee turnover and direct medical and mental health expenses, according to data from the American Institute of Stress. If some of the stress can be alleviated through meetings during which needs are identified, questions answered, and coverages purchased, the employer is in a net positive position in terms of productivity.
When it comes to benefits education, one size doesn’t fit all. Employers want to choose how they inform their employees about benefits based on their own needs and how well they feel their workforce will respond to certain methods. Options include group meetings and one-on-one consultation; in addition, some carriers will provide all education and training services, removing the responsibility from the employer.

To be successful, employers need to be able to focus on running their businesses. Unproductive, unfocused, and unsatisfied employees can really distract business owners.

In terms of benefits, these employee distractions can come in the form of wasted time cruising the Internet for information and deals, trying to sort out advisors from scoundrels, and stressing over not being able to obtain adequate coverage. When an employer vets carriers, advisors, and benefits, offers a controlled environment where they can learn about and purchase these benefits, and, finally, makes it easy to obtain and maintain them, employee satisfaction is a natural outcome.

Instant Insights /

Voluntary benefits: Make them so good, no one knows they&#039;re voluntary

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Voluntary benefits: Make them so good, no one knows they're voluntary