With millennials and generation Z employees representing roughly 75 per cent of the Canadian workforce, employers need to respond to the changing needs of these demographics, said Andrew Brandsma, director of sales for new business development at claims processing company National HealthClaim, during a session at Benefits Canada’s 2024 Vancouver Benefits Summit in May.

Both generations grew up in a “very fast-paced, chaotic world,” are living paycheque to paycheque moreso than generation X and baby boomers, remaining at home with their parents longer and delaying marriage and children or foregoing these milestones altogether. All of those factors translate to different priorities in benefits plans and employer support, he said.

Read: Survey finds majority of Gen Z, millennials dealing with anxiety, depression

Mental wellness benefits are crucial to both generations, as these workers are much more open about their mental health than gen X or baby boomers. According to research by Mental Health Research Canada, a third of employed Canadians are dealing with burnout and one in five Canadians experience some form of mental illness in a given year.

While an employee assistance plan alone is “table stakes,” it’s not enough to meet the demand, said Brandsma, adding it’s important for employers to evaluate their mental-health practitioner coverage limits and expand the list of covered practitioners to improve access. “There’s an opportunity here — bridging that gap between the generations within your workforce can also help solve that mental-health epidemic that is prevalent today.”

Millennials and gen-Zers also want greater say over how their benefits dollars are spent, rather than a one-size-fits-all traditional plan. Employers can meet this need by introducing some flexibility into the plan, such as through health-care spending accounts and taxable wellness spending accounts.

Read: Majority of millennial, gen Z workers more likely to stay with employers that provide benefits: survey

As of January 2024, more than a third of National HealthClaim’s clients had flexible spending accounts, said Brandsma, adding he also expects to see shifts in plan design toward simplified benefits plans with more dollars allocated to flexible spending accounts as a cost-containment strategy that simultaneously gives employees more choice.

However, the increased use of taxable wellness accounts will require greater education during the onboarding process to ensure employees understand that a small percentage of the amount they use will come off their paycheque as taxes.

Employers can also modernize the benefits experience for these digital native generations, with an easy-to-navigate app or intranet page to help employees understand what their plan covers and a frictionless claims experience, such as being able to take a photo of a receipt, upload it to an app and be quickly reimbursed.

Read more coverage of the 2024 Vancouver Benefits Summit.