Employee benefits and total rewards planning have always been a critical element of business planning, but never more so than during the ongoing coronavirus pandemic.
Mercer Canada conducted a recent client poll which showed that unlike previous years, most Canadian organizations still had not set their salary adjustment budget for 2021 as of early November. While it’s not surprising so many Canadian employers were in this position, the end of this tumultuous year presents an opportunity for business and human resources leaders to take a step back and identify gaps in current benefits structures.
In 2021, organizations should focus more on how they can build a total rewards strategy that is agile, adaptive and designed for the workforce of the future.
The need for a total rewards approach
Taking a holistic view of planning and budgeting for 2021 means going beyond compensation alone and focusing on a total rewards strategy that balances empathy with economics. This opens up new pathways for organizations to support their business objectives and reinforce their employee experience, despite the uncertainties caused by the coronavirus crisis.
Whether your organization is struggling, stable or growing and whether your salary budget is frozen or has room to increase in 2021, there are many non-monetary ways to enhance the employee experience. This can include conducting an incentive plan review, taking actions to generate health and group plan savings, sourcing insurance coverage that best protects employees, rolling out flexible benefits or spending accounts and implementing a digital wellness strategy.
Provide equal and inclusive benefits
For total reward offerings to be meaningful, they also have to be equitable and inclusive — meaning they should address the gaps and disparities in health care, well-being and financial protection for underrepresented groups. However, a recent Mercer survey found that over 83 per cent of companies have not taken any steps to identify and address inclusivity and the resulting health disparities and, in essence, are not yet striving for health equity.
Some examples of inclusive benefits could include:
- A flexible account that allows the individual to direct funds to the areas of wellness that are of individual priority.
- Support for caregivers, such as onsite daycare, caregiver referral and placement services and eldercare navigation.
- Telemedicine that can give access to mental-health support for members no matter where they are located.
Something as seemingly simple as broadening the definition of “family” when applied to benefits recognizes that not every member’s household looks the same and increases support.
Understand the additional pressures your employees are facing
When developing your strategy, particularly in these challenging times, it’s important to consider your employees’ personal situations. Within your organization, some people may be experiencing financial strain, particularly if a partner or dependant has lost their income or experienced a reduction in pay.
They may be juggling childcare or elder care responsibilities with their work obligations. For those nearing the end of their careers, they might be reassessing whether they can retire in the timeframe they’d planned. Each of these situations will impact your employees’ mental health.
When planning for 2021, employers need to consider how their strategies can help reduce the stress faced by employees, particularly considering how the impact of the pandemic will add to this pressure. Reimagining your benefits and savings plans starts with defining the immediate needs of your workforce while considering their long-term goals and adding flexibility as a core design objective.
Employers can support their staff by leveraging technology to deliver their benefits and rewards programs. More than 90 per cent of employees say they’re willing to try at least one of a range of digital-health tools, from telemedicine and telehealth solutions to second opinion services and health-care navigation.
From the employer’s perspective, digital tools offer agility. With the ability to measure employee preferences and collect real-time data from your employees, you can more easily adjust program offerings and shift budget to support your employees’ greatest needs.
Reshaping the future
The actions you take now will have a lasting impact on employee engagement, loyalty and productivity. While planning in this period of uncertainty creates several challenges, it also provides the opportunity to reflect on what benefits and plans are best supporting your employees and to revise creatively in a way that also mitigates risk and manages costs.
Beyond optimizing the budgets of your existing programs, employers have the opportunity to deliver more targeted value to different employee segments and better align incentive plans to evolving business objectives.