Understanding the diversity of the workers you have, the skills you want to attract, and the value employees place on benefits offered gives perceptive employers the advantage over the competition, according to Mercer.

The key can be summed up in two words: flexibility and creativity.

“By designing and implementing a flexible benefits program that includes a more extensive and innovative range of benefits, your total rewards strategy will help you predict, and therefore manage, your benefits costs,” said Marg French, a principal with Mercer, during a web briefing earlier today. “In a benefits plan, one size never fits all.”

Historically, benefits plans have been designed on the principles of insurance. This means that the many healthy, the 80%, pay for the other 20% so that the costs incurred are spread over the many, making them affordable for most.

On the other hand, flexible benefits allow employees to get involved in how some or all of their compensation dollars are allocated.

“Employees want to make their own choices,” she said. “Flexible benefits empower them to make choices that fit well with their priorities, their families, their culture, their career and their stage in life.”

Workers can use flex credits to purchase the coverage they think consider more valuable.

“With a flexible benefits approach, organizations should expand the range of benefits they’re offering,” French said. “Doing so just might prevent employees from looking for alternative employment.”

And the needs and expectations of each generation differ from the one before them.

“By understanding each generation’s unique outlook, employees can tailor their offerings to appeal to the target employees,” said Iain Morris, also a principal with Mercer.

He said work/life balance is becoming a number one issue among employees and in a tight labour market, it will be even harder to attract and retain workers unless employers embrace a new and more creative approach.

“Job sharing, part-time work, flex location and eight-month work years may help employers retain workers reaching retirement age and attract employees who place a high priority on work/life balance.”

To read another story on flexible benefits, It pays to be flexible, click here.

To comment on this story email craig.sebastiano@rci.rogers.com.

Copyright © 2018 Transcontinental Media G.P. Originally published on benefitscanada.com