Before making changes to a benefits plan or building one from scratch, plan sponsors should first determine what problems they’re trying to solve, according to a human resources consultant.

The reasons for implementing changes can vary, but moving forward without a clear motivation can cause problems, said Phyllis Retty, owner and human resources consultant at Lift HR Consulting, during a session at the Human Resources Professionals Association conference in Toronto on Thursday. That becomes especially important when engaging with staff because having a clear understanding of the purpose for the changes will help employers communicate with employees more effectively, she added.

Read: Solutions to ease employee backlash to plan design changes

Once they understand the underlying reason or justification for the change, plan sponsors should then ask themselves how the changes will fit into their total rewards strategies and value propositions for employees, as well as their organization’s goals, cost structure and employee branding, Retty suggested.

Understanding how current and potential employees perceive a benefits plan is also important for attracting and retaining the people who are best suited for a particular workplace, she said, noting a benefits plan should align with the image a company wants to project when it’s recruiting employees.

As for costs, “employees think you can afford everything,” but every plan sponsor knows it faces certain financial limitations, said Retty. When considering changes, companies should have a clear picture of whether their costs need to decrease, remain where they are or increase and by how much.

Read: ‘The sky is not falling’ on drug costs

Retty also warned that employers must do their research before implementing anything and should resist simply jumping into newer trends like wellness dollars and health-care spending accounts. “It’s a slippery slope” and may not be the most important or cost-effective way for a plan to grow, she said.

She also noted that taking away smaller benefits like flexible dollars can cause far more uproar among workers than more substantial changes because employees can perceive it as nickel-and-diming. Instead, plan sponsors need to closely examine the data available to them. And if they aren’t already requesting that data from their insurer, they should start, said Retty. “Really look to see where people are using their dollars.”

Another research method is engaging directly with employees, she suggested, noting employers can do that through focus groups since “you need to ask people. You don’t design a product and then take it to market and just hope everybody buys it.”

Read: Seven benefits trends to watch in 2018

Questions during these focus groups must be specific to be successful, noted Retty, adding employers should never go in with broad, open-ended questions. “Don’t ask, ‘What would you like us to cover?'” she said. Rather, they should ask about what challenges employees are experiencing with the plan, she suggested.

Finally, Retty noted that while many plan sponsors will want to work with a consultant, it’s important for companies to engage with the research themselves. While that often means extra work, it can be a worthwhile learning opportunity, she said. It will also add to employee confidence in their employer if the consultant isn’t the only one who can answer questions and clearly explain why the changes are occurring, she said.

Read: Why leaping to save on benefits premiums may cost employers

 

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

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