When Linda Lee joined Velocity Global, a Denver-based HR technology platform company, as head of people and culture earlier this year, one of the first things she noticed was that the company focused on “shiny” visible benefits, such as meditation apps. but the use of these benefits was low.
Lee also found that many employees who used the apps did so for unintended purposes, such as listening to background music. She quickly realized that the company’s budget could be better spent on more practical benefits that were underfunded or not funded at all, and which could potentially have a more significant impact on engagement and well-being. – be employees.
“I needed to rebalance the benefits which, yes, seem flashy,” Lee explained. “My #1 priority was to rebalance and change how I invested (in benefits), especially around shiny, low-use benefits.”
So Lee took a data-driven approach to reconsidering the benefits of the business. She analyzed the utilization rates of various benefits and employee benefits and identified those that were not effectively meeting employee needs. She then offered a plan to redirect investments from providing low-use benefits to improving more meaningful benefits. This included lower health insurance premiums, increased matching for 401(k) plans, and consistency of benefits across the global organization.
Part of a larger trend
Velocity Global isn’t alone in taking a hard look at benefits and shifting from funding flashy employee benefits to bolstering traditional benefits.
Other companies are also reassessing their benefits, driven to some extent by changes in the design of work that began during the COVID-19 pandemic and have continued across many organizations. High-end perks, such as ping-pong tables and catered meals, don’t have the same impact when large numbers of employees are working from home.
“People don’t stay with their company because they get free breakfast tacos,” said Abby Payne, human resources director at SailPoint, an Austin, Texas-based software company. “Employees stay with organizations when they feel valued, rewarded, and part of a community. Achieving these three things is hard, but no pool table or pickleball tournament will ever be a real solution.”
At SailPoint, Payne said, the focus is “on performance and career growth, rather than freebies.”
This focus is paying off: in the company’s most recent employee engagement survey, 90 percent of SailPoint employees said they felt they belonged, and 86 percent said they felt valued for their unique contributions. .
SailPoint seeks employee feedback to make improvements to its benefits programs, Payne said.
“Giving benefits to people is easy, but it usually provides short-term benefits,” she said. “A constant focus on employee success generates true engagement.”
Payne’s experience is backed by research. THE Achievers Workforce Institute 2023 State of Recognition Report found that employee recognition can boost productivity, balance heavy workloads, help maintain company morale and even offset layoffs, according to Hannah Yardley, the institute’s director of human resources and culture. headquartered in Toronto.
At UKG, a human resources, payroll and workforce management solutions company, HR director Pat Wadors said employees value choice and fairness.
“The pandemic has brought both to light,” she said. “Before 2023, we had various individual benefits for parents, people without children, people with pets, people at the start of their careers, those close to retirement, those only in certain countries – it was everywhere.”
UKG then heard from its employees, who work around the world, that “they didn’t think they could take full advantage of our benefits because some programs didn’t apply to them or weren’t available in their area”. explained Wadors. . “Put simply, it wasn’t fair.”
In response, UKG this year launched its You choose benefit, a reimbursement of $350 per term that UKG employees can spend on more than 100 different living needs, including student loans, fitness equipment, dependent care, home office supplies, travel expenses and pet care.
Wadors said U Choose allows the company to offer “a great mix of traditional and brilliant perks that serve people at all stages of their lives.” Employees “say they like having the power to choose so they can take conscious steps to customize benefits to meet their unique needs.”
Changing times bring changing approaches
“The shiny perks were great when the workforce was focused on an in-office experience and the tech industry was competing for talent,” said Barbara Palmer, workplace leadership coach and founder of Broad Perspectives Consulting, based in Los Angeles. But “in the face of widespread layoffs and the shift to distant or hybrid cultures, the benefits are also changing.”
Meeting employees where they are, literally and figuratively, will be important in all industries. “There can still be benefits beyond traditional benefits, but they need to match the needs and culture of today’s workforce,” Palmer said.
Perks like gym memberships, wellness allowances, lunches and snacks may still make sense in some settings, but only if they complement traditional perks, she added.
“Before extras happen, it’s important for companies to make sure they’re competitive in terms of core benefits,” Palmer said.
And, as Lee discovered, it’s important to track whether and to what extent employees actually use these extras.
Communicate strategically
Even though companies are increasingly modifying their benefits to better meet the needs of their employees, and thus removing certain benefits, experts say it’s important for human resources and benefits managers to communicate strategically with employees. about these changes.
For example, when the revamped benefits plan at Velocity Global was approved, Lee worked with senior management on a rollout and communications strategy.
“We decided not to do it in ‘death by 1,000 cuts,'” Lee said. “We announced all the changes at the same time.”
Aware that even employees who weren’t using benefits might perceive any adjustment as a reduction, Lee took several steps to get employee feedback and ensure two-way communication:
- She created a culture committee, pre-approved by members of the leadership team, that included people she identified as “cultural ambassadors” – highly respected employees who others turned to for guidance. information and advice. These committee members were briefed in advance and were consulted for their input and support. Their role was to act as points of contact for other employees, helping to manage feedback and questions related to the benefits overhaul.
- Lee took a multi-faceted communication approach, first reaching out to the entire company as well as the CEO to announce changes and answer questions. She also provided personnel managers and HR business partners with FAQs to address employee concerns and questions. This ensured that employees received consistent and transparent information from different channels across the organization.
- In order to maintain open communication and show empathy during the process, Lee made herself available on Slack to receive anonymous questions and feedback and responded to all messages personally. She also held one-on-one meetings with employees to show them that their opinions and feelings mattered.
Openness and transparency are key when companies make significant changes to benefits, Lee said.
In a critical time like this, “I will make myself available, anywhere in the world, morning, noon and night, just to connect with people, because I believe everyone wants to have a sense of belonging” , she said.
Although Lee said some employees were hesitant about the changes, overall the company’s revamped benefits approach has worked well.
“If you take the time to recognize that (employees are) valued and their opinions matter, that goes a long way on the continuum of engaging them in change,” she said.
Lin Grensing-Pophal is a freelance writer in Chippewa Falls, Wisconsin.