5 Issues That Impact the Move to Flexible Benefits
In a rush to make millennial employees happy, a number of companies are making significant moves to allow these new workers to select their own benefits. Employees want to see a smorgasbord of health and financial benefits laid out and cherry-pick what best fits their lifestyle.
It sounds like a perfect solution for a generation that wants to chart its own course, but it’s not as simple as that.
Behind the move to give employees increased personal choices in benefit package lurks a growing entanglement of human resources issues.
Here are 5 things to be aware of if your firm decides to follow the trend towards offering a menu of benefits for each employee to customize to their liking:
- It is a lot harder for younger employers to understand what kinds of benefits they should be selecting. When you are youthful and healthy, for example, you can rarely even imagine the range of health issues that could befall you in the later years of your working life. When you are single and concerned only about yourself, it is difficult to understand whether you need a dental package that would allow for children to get braces. When your body doesn’t hurt, you can’t see the value in that physical therapy or massage therapy package.
- Even if the employee can imagine the kinds of benefits that will serve them best throughout the next few years, they rarely have the kind of expert knowledge to understand the proper ratios of allocating their benefit packages. Should it be heavy on pension, low on health, high on wages and low on pension contributions? By the time they understand that they made the wrong selections because of their lack of expertise in such matters, it is often too late to make essential repairs.
- Giving so many individual benefit choices to employees can come at a slightly higher cost to the company and the employee than if a company is able to negotiate a one-size fits all benefit package for all employees. There is no buying services in bulk when you are offering the customized packages.
- Your human resources department will need special training and heightened communication skills to explain what all the benefits offered involve and to make recommendations if asked. It is the nature of the millennial worker to want a quick text back in response to a complicated question, and sometimes complicated issues like benefit packages just don’t fit the short attention span allotted to them.
- The millennial work can hardly imagine what would constitute a pleasant life when they retire, and that makes it extremely difficult for them to pick the benefits that will see them through to retirement. You can’t reach a goal if you don’t know what that goal is.
When it comes to offering customized benefit packages because it seems like the trendy thing to do, think through these issues and make sure you have strategies to deal with them.
For more information on flexible benefits, contact SkyPrep today!