The Canadian Source Of Employee Pension Fund Investment And Benefits Plan Management

Back Issues

Creativity Fills Communication Gap

By: Paul Okeefe

Imagine if the typical workplace were a classroom in which employees were handed a pop-quiz testing their knowledge of the company benefits plan. Chances are the ‘test’ would reveal wide gaps in their understanding of coverage.

In fact, according to a recent workplace poll by the Canadian Worksite Marketing Group, more than 30 per cent of full-time employees surveyed admitted they don’t fully understand the scope of coverage provided by their group plan. And more than 60 per cent would like their employers to be more proactive in reviewing what the plan covers and how it works.

Results like these may strike many plan members and sponsors as surprising, since conventional thought suggests that the only thing employees want most from their benefit plan is more. But more of what, exactly?

Many employers grappling with attraction and retention challenges continue to assume that ‘more’ must necessarily come in the form of costly sponsored coverage. However, escalating premium costs have prevented many plan sponsors from adding paid benefits to their plans, leaving many to conclude there is no way to enhance the value of the benefit plan without taking on significant costs.

Quality Of Benefit Communications

But in certain business circles, plan sponsors with one eye on cost management and the other on talent competitiveness, are starting to employ more innovative ways of meeting employee needs. More specifically, what distinguishes one workplace from the other frequently depends on the quality of benefit communications and on the inclusion of more flexibility and choice in the benefit menu – though not necessarily at added cost to employers.

Plan sponsors can often get more bang for their buck by helping employees to understand and, in effect, appreciate the value of coverage they already have. How? Some Canadian employers have found they can raise employee appreciation remarkably well by arranging relatively short, but personalized meetings between a benefits specialist and employee at the workplace. Ideally, the one-on-one presentation summarizes key features of the employee’s coverage based on their personal data, including the accumulated worth of their pension plan or RRSP, value of life insurance or disability coverage, even the details of medical and travel insurance.

In addition, plan sponsors are using these meetings as an opportunity to review how their plan works, to update census data, complete group enrollments, and to offer a growing portfolio of voluntary self-funded benefits that employees can purchase to fill gaps in their coverage.

Virtually without exception, employees welcome an opportunity to formally review their group coverage, viewing the consultation as an example of the employer’s commitment to maintaining satisfaction in the workplace. Equally, if given the choice to purchase additional coverage, such as critical illness insurance, most employees once again view the offer favourably as a service enhancement whether they elect to purchase coverage or not. While they are a new concept for Canadian employers, voluntary employee-paid benefits can be an effective way to maintain an attractive benefits package while transferring the cost of some discretionary benefits to employees.

Employers Shift Onus

In practice, carving out 20 minutes of time to meet with every employee is an unmanageable drain on HR resources. Plan administration and communication remains a constant challenge for benefit administrators.

Looking to insurance carriers to fill the communication void is just as unlikely. According to a 2002 LIMRA study, Trends in Canadian Group Insurance and Health Care Benefits, benefit administrators have little confidence in carriers taking a lead role in communicating the value of their plan. “The onus is typically on the employer,” LIMRA’s report concludes. “The carrier may provide a generic newsletter, but it is typically so generic that it provides little more information than employees can get from the popular press.”

Instead, benefit administrators must look beyond traditional sources for communications support. What they’re finding is an unprecedented array of innovative programs they can bring to the workplace at virtually no cost. Increasingly popular in Canada are programs such as worksite benefits, which combine personalized employee communications and voluntary employee-paid insurance as an optional core plan enhancement.

Once regarded as a predominantly U.S. approach, worksite benefit programs are gaining a foothold today in Canada, particularly as employers north of the border look for affordable communications expertise and service. What’s more, employers here are drawing on the employee retention advantages that tend to spin off this kind of program, which places attention and focus on individual employees.

In the competition for talent, strong benefit communications and enhanced choices will become increasingly important considerations for Canada’s employers and employees. Rather than bear all the costs of rising premiums and administration, employers will find they can enrich their benefit plans affordably by employing a little of their own creativity and a great deal of innovative support that’s ready to be tapped.

Paul Okeefe is vice-president, sales and marketing, of the Canadian Worksite Marketing Group, a national benefit communications firm based in Toronto, Ont.

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Subscribe to Daily News Alerts

Subscribe now to receive industry news delivered to your inbox every business day.

Interactive issue now onlineSubscribe to our magazinePrivate Wealth Online