As employers and employees grapple with the economic downturn resulting from the pandemic, the role of employee benefits is more important than ever. Companies who have an employee-first approach have an opportunity to meet the needs of their employee's health and wellness with a thoughtful employee benefits strategy. The challenge, however, is that many employees lack understanding and/or ignore how benefits can help. In times like these, it's imperative that employers and benefits advisors ask themselves, how can we create a digital enrollment experience that is efficient and cost effective and will help ensure employees understand the benefits offering?
Recent surveys indicate most employees do not fully understand the benefits offered to them. In fact, the average score on Guardian's 2020 Employee Benefits I.Q. Quiz is a 70%, or C on a standard grading scale. Among single parents and millennials, scores were lowest, averaging 38% and 39% respectively. These findings confirm that workplace satisfaction comes from more than just the benefits offered; it also includes how those benefits are communicated and how employees are enrolled.
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Fifteen years ago, brokers, employers and employees were mired in paperwork, and although many aspects of the employee experience have been digitalized and automated today, benefits administration continues to lag. After all, what HR function actually requires employees to sign a form with a pen? In this age of texting, it's counterintuitive to present a new hire with reams of environmentally questionable paper forms to complete.
Unfortunately, benefits administration has historically been a manual, fragmented, and brittle process. While the spirit of working together was present, the tools and technologies were not. Aspirations of operational efficiencies remained out of reach and employees had better experiences purchasing car insurance than they did when making crucial health care decisions for their families. The good news is that HR technology adoption is on the rise. According to Guardian's 8th Annual Workplace Benefits Study, 92% of employers work with HR systems/software, with 70% using them for benefits administration – up 26% from 2017. And 4 in 10 employers have integrated at least some HR and benefits functions.
As ben admin technology became more accessible, larger employers embraced it, and smaller employers were also able to put their benefits online due to affordability. Simply put, the economics changed, making it more democratized. Take for example that benefits technology is getting greater C-Suite attention and more budget. In fact, 48% of employers increased their spending on benefits technology in the last three years. Additionally, higher adoption of technology in the employee benefits category is consistent with the overall trend of companies adopting technology at significant rates, especially with the push for digital transformation. Exchanging data in real-time and removing manual interventions has the potential to become the norm; however, it's not yet a reality for some employers. And for employees, it's not moving fast enough.
For HR managers and benefits administrators who are still advocating for benefit technology change within their company, consider the following:
- Talk to your broker and/or benefits consultant about your company's needs. Our research revealed many employers have not had a conversation with their broker/benefits consultant about the right benefit options. Look for carriers and ben admin partners who work together to deliver the best experience for your company and employees.
- Look for a platform that aggregates all benefits options on one platform, coupled with a personalized shopping experience for the employee. The same is true for your company. It's important to find a benefit technology solution that makes it easier for the employer to set up their benefits and have ongoing access to the platform.
- Think about the enrollment experience you want to offer employees and find a platform that delivers a seamless and familiar enrollment event for your workforce.
Employees want to have the same experience when making their benefits decisions as they do when they shop online. They want the ability to find answers to critical questions. They want the shopping experience to be simple, rather than a burden placed on the employee to sort through arcane and convoluted information. The reality is that if employees don't understand it, they don't buy it. Benefits technology may be overwhelming, but the rewards are too great for a company to ignore. With cloud-based HR software and modern API carrier integrations emerging, the time is now for companies to evolve their employer and employee benefits experience.
Beata Rogala is 2nd Vice President, Benefits Administration Partnerships, at Guardian Life Insurance Company of America.
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