Using benefits design to drive employee engagement

As employee engagement garners more attention as a key performance indicator, it’s also weaving its way into the way employers design and construct their workplace policies and benefits programs.

There are many compelling reasons why organizations focus their attention on employee engagement. There’s clear evidence that high engagement leads to improved organizational results, such as lower turnover, higher profitability and greater customer satisfaction. High engagement also results in lower absenteeism and increased employee morale and productivity. As well, it contributes to improved employee health and well-being. 

Read: Benefits plan design touted as key to optimizing company spend

A number of workplace elements effect employee engagement, but its primary drivers are: 

  • Leadership;
  • Brand, including reputation, mission and corporate responsibility;
  • Company practices, such as communication, customer focus, diversity and inclusion, enabling infrastructure, talent and staffing;
  • Performance drivers, such as career opportunities, performance management, opportunities for professional growth, and rewards and recognition;
  • Elements of the work itself, such as the opportunity for collaboration, the degree of autonomy given to employees and work tasks; and
  • Basics, such as benefits, job security, safety, physical work environment and work-life balance;

While benefits plans clearly fall into the benefits bucket, plan design can affect other dimensions of engagement and drive behaviour that touches elements of it.

Read: Pitney Bowes focuses on prevention in benefits redesign

Plan sponsors consider many contextual aspects when designing a benefits plan. They include their philosophy about the purpose of a plan; relative competitiveness in the industry in which they compete for talent; cost control and sustainability; corporate culture and values; and how they intend to use benefits to support their employees at work. Driving employee engagement through benefits design, however, is generally a byproduct, rather than a key design consideration.

Taking the elements of engagement into consideration, let’s look at plan design and its role in employee engagement from two key angles: building choice and control into design and how it influences and supports employee well-being.

For many plan sponsors, giving benefits choice is synonymous with implementing a flexible benefits plan. The 2017 Sanofi Canada health-care survey showed plan members prefer flexible benefits plans over traditional designs. Conversely, employers prefer traditional design over flexible plans presumably because of the perception of increased administrative complexity. But opening up a benefits plan with more choice for members is possible without having to commit to a fully flexible arrangement.

Read: Fewer employers making changes to benefits plan design: Sanofi survey

Any element of a benefits plan that’s voluntary or that allows employees to use their coverage for what’s important to them, rather than a prescribed list, gives plan members a degree of control over how their benefits can fit them and their unique needs. Layering on other non-traditional voluntary benefits such as home, automobile and identity theft insurance or even the ability to contribute to a registered retirement savings plan or a tax-free savings account, adds to a more flexible member experience and greater choice in how they interact with their employer’s benefits offering.  

Employers can reframe benefits plans designed to promote consumerism as offering choice through fulsome communication that emphasizes decision-making. The approach can also drive engagement by turning health-care use into a more active process.

In the context of employee well-being, organizations often have a variety of programs in place that support organizational health management, such as the design of the work environment; how they structure work groups and leadership; internal and external activities that align with their culture; occupational health and safety programs that keep employees safe on the job; and disability management programs that support employee recovery and return to productivity. 

Read: Four considerations for employers around disability management

Many organizations also include wellness programs, some of which they’ve specially chosen to help improve population health through disease management or reduce risk factors in order to prevent chronic disease. Wellness itself, however, is evolving, with the focus broadening beyond activities supporting physical and emotional health to include financial and social well-being. Benefits design elements that contribute to improved engagement while promoting well-being could include financial security through savings or debt reduction; programming that encourages employees to improve their financial literacy; concierge services that support work-life balance; and paid time off that includes the ability for employees to volunteer in the community.

Thoughtful plan design that creates space for employee choice, along with elements that support the four dimensions of well-being, can be a very effective tool for promoting employee engagement, while still supporting positive health outcomes and long-term cost sustainability. And adding a comprehensive communication strategy that emphasizes those elements can be an effective contributor to an organization’s drivers of employee engagement.