The Importance of Benefits Communication – A Key Differentiator

Elizabeth Halkos

Jun 1, 2011

The Importance of Benefits Communication – A Key Differentiator

Strong communication has always been a priority for H.R. managers, but the recovering economy has elevated its importance as a retention strategy.

As the economy recovers from economic recession, H.R. managers nationwide face new obstacles.  The 9th Annual Study of Employee Benefits Trends, sponsored by MetLife, states this challenge to employers in its executive summary: “Reprioritize employee loyalty and satisfaction, or economic recovery may arrive with unanticipated setbacks for retention and productivity.”

Increasing employee loyalty and satisfaction can be daunting tasks. One of the most effective ways to move the needle in this area is to better communicate to your employees – often a simple and cost-effective strategy. When it comes to benefits offerings, specifically, increased employee communication will help employees better understand their choices, be able to make more informed decisions and appreciate the value of the benefits they have access to through their employers.

Studies repeatedly indicate that employees who are satisfied with their benefits are more satisfied with their jobs. Now is the time to make successful communication a priority. Giving your employees more information about their benefits through increased, strategic communication will help empower them to make the best decisions about their plans, and at the same time, contribute to job satisfaction.

Given the instability many companies experienced during the recent economic recession, H.R. mangers may not be in the habit of frequently communicating with their employees – about benefits or other topics. Recently, many H.R. departments have had to focus their time and communication on sensitive subjects such as lay-offs, pay cuts and decreased benefits or perks. Understandably, communication about seemingly less urgent items, like benefits, may have slowed.

With many companies now in a more stable position, it is the perfect time to re-engage your employees through more frequent communication. Deloitte LLP’s 2010 Ethics & Workplace Survey reported that one-third of American workers said they plan to look for a job when the economy improves, and of those, 46 percent cite “a lack of transparency in communications” as the reason. This speaks clearly to the need for better and more frequent communication across the board, and specifically, around benefits.

Additionally, there is disconnection between how employers think they are communicating about benefits and what employees actually understand. In fact, a 2010 Aflac study found that 40 percent of H.R. executives believed they were “very effective” in communicating about benefits. However, 40 percent of employees reported that their H.R. departments were “only somewhat effective” and 27 percent reported that their H.R. departments were “not effective at all” in communicating about benefits.  Some reasons for this disparity may be due to the fact that many employees have been working longer hours and taking on increased responsibilities due to lay-offs or are feeling pressure to perform due to job insecurity. Even so, anyone involved in benefits administration should take the time to closely examine their communications strategies to make sure they are truly being effective in reaching and engaging employees.

So how can H.R. managers better communicate with their employees about benefits programs? Just as one benefits program no longer meets the needs of every employee in today’s diverse workforce, neither does one communications strategy work for everyone.

Take a close look at the generations represented in your workforce and consider what form of communication might best reach them. For instance, Baby Boomers often prefer traditional methods of communication, such as home mailings. However, all generations increasingly prefer to have online access to information about their benefits, which amplifies the need for employees to have access to a computer at home. According to the United States Census Bureau, an average 76.68 percent of U.S. households nationwide have access to the Internet at home , so using online tools can be a very effective way to reach employees when they are making decisions about their benefits with their families.
Social media channels are also becoming increasingly popular ways to reach employees, specifically those in younger generations. Although many companies do not think they have the resources to implement these channels, MetLife’s 2011 survey found that 74 percent of employers acknowledge that social media provides an easy way for employees to have access to information. 

Although there may be privacy concerns around using social networking sites like Facebook, Twitter and LinkedIn to share benefits information, think about ways you can utilize existing channels such as videos, intranets, webinars and podcasts. Communicating your benefits in new, engaging ways may help employees become more interested in their packages and more likely to take advantage of what you have to offer them.

Interestingly enough, MetLife also reported that across generations, 36 percent of employees preferred to have their benefits explained to them by a live person, so don’t discount the importance of continuing to have face-to-fact contact with employees about their programs.

If you are concerned that increased communication about benefits will create an administrative strain on your H.R. department, don’t hesitate to reach out to your providers for assistance. Many benefits companies will be happy to provide you with materials to distribute to your employees about their programs or conduct “lunch n’ learn” sessions on site. This ensures companies are providing all the communications support for clients, including mailers, HTML emails, posters, payroll stuffers, newsletters, and information for your intranet.

Lastly, always make sure your employees understand the total value of their compensation and benefits package. More companies are adopting the practice of distributing total benefits statements, which can be a great way to build loyalty as employees better understand the full value of what is being provided to them.

If you are unsure of the best way to communicate with your employees, simply ask! Starting a dialogue with employees about their preferred methods of communication is a great way to begin this process. Above all, remember that your benefits offerings are only as good as the information communicated. By making a conscious effort to increase communication around benefits, you will likely be able to engage your employees more; in turn they will be more satisfied with their benefits and with their jobs. Now isn’t that a goal worth striving for?

About The Author

Elizabeth Halkos is the Chief Marketing Officer for Purchasing Power, an Atlanta-based voluntary benefit company. Founded in 2001, Purchasing Power offers a program that makes it possible for employees of participating organizations to purchase computers, electronics and home appliances through the ease of payroll deduction. Participants can have manageable payments automatically deducted from their paychecks over just 12 months and the item is delivered directly to their homes in just a couple of weeks.

Purchasing Power is licensed in all 50 states as a reseller of personal computers, consumer electronics, and home appliances. Since the program’s inception, Purchasing Power has serviced more than 500,000 orders for employees of companies across the U.S., including Fortune 500 and government agencies. The company’s revenue has doubled since 2008.

Learn more about Purchasing Power’s program by visiting www.PurchasingPower.com or by visiting http://l.purchasingpower.com/premier to watch employer testimonial videos. You may contact Purchasing Power via e-mail at sales@purchasingpower.com, call us at (877)-723-2798 or follow us at www.twitter.com/PurchasingPower.  

Resources

1-  “Insurance for Life," a study conducted by Harris Interactive for Aflac, September 2010.

2- http://www.census.gov/compendia/statab/2011/tables/11s1156.pdf and http://www.ntia.doc.gov/data/CPS2009_Tables.html.

3- MetLife, 9th Annual Study of Employee Benefits Trends, 2011.

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