A Primer on QSEHRAs
This article is from RISQ Consulting’s Zywave client portal, a resource available to all RISQ Consulting clients. Please contact your Benefits Consultant or Account Executive for more information or for help setting up your own login.
Due to rising health care costs, small businesses often struggle to provide employees with affordable, high-quality benefits. In fact, many small businesses choose not to offer employee benefits because of cost constraints. Failing to offer health benefits can place small businesses at a disadvantage when it comes to attracting and retaining key talent compared to their larger counterparts. However, qualified small employer health reimbursement arrangements (QSEHRAs) offer small businesses the opportunity to provide employees with affordable, quality care.
A QSEHRA is a health reimbursement arrangement (HRA) that allows a small business to provide employees tax-free reimbursements for health insurance premiums and other qualifying health care expenses. Compared to traditional group health plans, QSEHRAs can offer small businesses more flexibility and affordability when administering health care benefits while tailoring benefits offerings to fit employee needs.
This article provides a general overview of QSEHRAs and outlines some considerations for employers to keep in mind when deciding whether to offer employees this coverage.
What Is a QSEHRA?
A QSEHRA is a health reimbursement arrangement for employers with fewer than 50 full-time employees. It allows qualifying small businesses without employer-sponsored group health benefits or any excepted benefits, such as dental and vision, to provide tax-free reimbursements to employees for eligible medical expenses. To qualify for tax-free reimbursements, employees must be enrolled in health plans that meet the minimum essential coverage (MEC) requirements outlined in the Affordable Care Act.
How Do QSEHRAs Work?
An employee with MEC can submit qualified medical expenses and supporting documents to their employer for reimbursement. Qualifying expenses typically include:
- Insurance premiums
- Coinsurance
- Copays
- Deductibles
- Prescription or over-the-counter drugs
The employer then provides tax-free reimbursements to the employee, up to a specified annual maximum amount. The IRS imposes annual maximums per employee, with separate limits for individual and family coverage. If an employee’s medical expenses do not reach the annual maximum reimbursement amount during the plan year, the employer may keep the remaining balance or roll it over for the following year. Employees may not receive cash payments for the difference if their expenses fail to reach the annual maximum amount.
QSEHRA Eligibility Requirements
The eligibility requirements for QSEHRAs differ for employers and employees.
Employer Eligibility Requirements
For employers to be eligible to offer a QSEHRA, they must meet the following requirements:
- Employ less than 50 full-time employees
- Not offer a group health plan, excepted benefits or a flexible spending account (FSA)
Employee Eligibility Requirements
Most employees of an eligible employer may qualify to participate in a QSEHRA. Even employees without MEC can still participate in their employer’s QSEHRA, but their medical reimbursements will be taxable. Additionally, employees with group health coverage through their spouse can participate in a QSEHRA, but their group health premiums cannot be reimbursed. However, employers can exclude certain categories of employees, including part-time and seasonal employees as well as employees younger than age 25.
Considerations for Offering a QSEHRA
QSEHRAs allow small businesses to offer employees health benefits without having to manage a group health plan. This can help small businesses avoid the potential downsides of traditional health insurance plans, such as expensive premiums, restrictive participation, contribution requirements and annual rate increases.
QSEHRAs can also benefit employers offering health benefits for the first time since these plans allow employers to control costs, provide flexibility and scale their benefits as their organization grows. They are often a good option for organizations with a remote and geographically disbursed workforce because small businesses may be unable to find a national carrier that provides high-quality, affordable health benefits. Additionally, QSEHRAs can offer employees more choice in how they spend their health care dollars than traditional health plans.
Summary
QSEHRAs offer a valuable solution for small businesses seeking to provide health benefits to their employees without incurring the costs typically associated with traditional group health plans. Leveraging the flexibility and tax advantages of QSEHRAs can help small businesses offer competitive benefits to attract and retain top talent while controlling costs.
Reach out to us today for more information on QSEHRAs.
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Strategies for Identifying and Resolving Gaps in Benefits Offerings
This article is from RISQ Consulting’s Zywave client portal, a resource available to all RISQ Consulting clients. Please contact your Benefits Consultant or Account Executive for more information or for help setting up your own login.
In today’s competitive employment landscape, many organizations recognize that employees are their most valuable asset. To attract and retain top talent, employers must go beyond competitive salaries and create holistic and meaningful employee benefits packages that address diverse workforce needs.
Understanding and addressing any gaps in employee benefits is crucial for employers who aim to create an engaged, supported and satisfied workforce. Well-rounded benefits packages often translate to enhanced employee well-being, boosted retention rates and a positive work culture.
This article highlights proactive steps employers can take to assess and identify gaps in employee benefits offerings.
Employer Considerations
Identifying gaps in benefits offerings can be a complex task, as it requires a careful assessment of employee preferences, trends and organizational resources. Consider the followings strategies for identifying and addressing these gaps:
- Review existing benefits. Start by reviewing the current employee benefits package. While taking inventory of benefits, organizations should assess if they offer the basics (e.g., health insurance, sick and family leave) or anything unique compared to competitors or other employers in their industry. This is also a good time to review benefits utilization to better understand if there are any benefits that employees do not or rarely use.
- Analyze employee demographics and specific needs. Demographics, such as age, gender and marital status, can influence employees’ preferred benefits. Recognize that those needs can shift over time, so this is an ongoing exercise.
- Gather employee feedback. Conduct surveys, focus groups or collect feedback through other methods to gather information and opinions directly from employees. Employers could inquire about employee satisfaction with existing benefits, what they value most and if there are any benefits they feel are missing from their package or that could be improved.
- Benchmark against industry standards. Research industry standards and best practices to understand what benefits competitors, and similar or local organizations provide. This can help employers identify any gaps in their offerings compared to competitors.
- Explore emerging trends and employee preferences. Stay informed about employee benefits trends. Current trends include flexible work arrangements, mental health support and student loan assistance. This is also the time to consider employee feedback results and reported preferred benefits.
- Prioritize benefits based on budget and resources. While employers may be faced with a long list of attractive or preferred benefits, the reality is that they must also consider organizational finances and resources to determine the feasibility of new or different offerings. It may be helpful to prioritize the benefits that would have the most significant impact on employee satisfaction and overall well-being.
- Communicate changes effectively. Employers should ensure clear and effective communication with employees when introducing or modifying benefits. Education is critical to utilization, so employers should clearly describe any changes, provide their rationale and explain how benefits changes align with employee feedback, emerging trends or organizational goals.
- Monitor and reassess. Benefits needs and preferences change over time, so it’s important for employers to regularly monitor the utilization and effectiveness of offerings. If drastic changes were made, checking in with some employees to gauge their feedback could be worthwhile. Lastly, keep the conversation going with employees to keep a pulse on their preferred benefits and reassess available options to ensure they meet evolving needs.
Summary
Savvy employers continually evaluate their existing benefits, gather employee feedback, benchmark against industry standards and strategically address any identified gaps. By periodically reassessing benefits offerings, employers can ensure they remain competitive in the labor market and meet the evolving needs of the workforce.
By taking a proactive approach to understanding needs and preferences, organizations can create benefits packages that truly support current and prospective employees. This concerted effort can lead to increased workplace engagement and satisfaction, and, ultimately, organizational success.
Contact RISQ Consulting for additional employee benefits guidance.
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Medicare Mayhem – How to Navigate Medicare in Alaska
By Alison Nelson, Employee Benefits Account Manager
“I’m turning 65 and need to learn more about Medicare. What do I do?” This is a common and very valid question that I’m often asked. Medicare is daunting, and with 75% of Medicare beneficiaries worrying about affording costs beyond premiums, you’re going to want to understand all of your options.
I want to start by noting that I am not a Medicare expert. However, before you scroll away, I can provide some tools and resources that could be helpful in your Medicare journey.
A great first resource is medicare.gov. I know, I know. The government’s Medicare website for info on Medicare… revolutionary! But it truly is a great and underutilized site that breaks down the ins and outs of Medicare. In summary, there are four main plans with additional coverage available:
- Medicare Part A: Hospital Coverage
- This is often free and is automatic if/once enrolled in social security.
- Medicare Part B: Provider Coverage
- $170.10/month (or higher depending on income).
- We see most people waive Part B as long as they are enrolled in a qualified employer-sponsored health plan.
- Part B has no out-of-pocket maximum, so you would be responsible for 20% of expenses with no cap – this can add-up quickly. If employer coverage is terminated, we often recommend enrolling in a Medigap or Medicare Supplemental policy. This puts a “stopgap” or out-of-pocket limit to expenses. If this coverage is obtained following the loss or termination of qualified coverage, you can likely forego underwriting. If Medigap is waived at initial eligibility and obtained later, underwriting is likely – meaning if there are pre-existing conditions, you could be denied coverage.
- Medicare Part C: Medicare Advantage
- Part C is offered by Medicare-approved private companies that must follow rules set by Medicare. Medicare Advantage Plans include Part A and B coverage, and many include Part D drug coverage as well. However, it’s important to note that Part C is not available in Alaska.
- Medicare Part D: Prescription Coverage
- The costs vary by plan
- Medigap or Medicare Supplemental Coverage
- You are able to obtain supplemental coverage if enrolled in Part A & B.
- RISQ Consulting has a dedicated individual who is appointed by Medicare and is able to assist with Premera Medicare Supplemental Plans. There are no fees for her service.
- An additional popular Medicare Supplemental plan is with United Health Care through AARP.
Another resource, and one of the most comprehensive and digestible guides, is the Medicare & You 2023 Guide.
However, my number one recommendation is to reach out to the amazing folks at the Alaska Medicare Information Office! This is a free service for Alaskans by certified Medicare professionals. These pros are able to provide personalized recommendations and can walk you through the complexities of Medicare.
Becoming Medicare eligible can seem overwhelming, but with the right tools and resources, you’ll be able to navigate it like a pro. And, as always, if you have any questions or need to be pointed in the right direction, RISQ Consulting can help.
- Published in Blog
Mental Health in the Workplace, Part 2
By Alison Nelson, Employee Benefits Account Manager
In case you couldn’t tell from this article I wrote last year, mental health is something I am very passionate about. I aspire to contribute to the destigmatization of mental health, especially in the workplace, in whatever capacity I can. When I recently read this article stating that only 19% of employees used their mental health benefits in 2022, I was saddened, but not shocked by that statistic. The article goes on to say:
“A new report by One Medical and Workplace Intelligence, which surveyed 800 employees and 800 human resources (HR) professionals, found that, not only did over nine in 10 (91%) employees tell surveyors mental health was negatively impacting their productivity, but the usage of benefit offerings already in place by employees was extremely low. Less than a fifth (19%) of employees said they used their mental health care benefits in 2022.”
Why don’t employees utilize their mental health benefits? According to Business Wire, it may be because employees undervalue their mental health and tend to reserve benefits for more urgent needs. In other words, people tend to prioritize their physical health over their mental health. I hypothesize that this is, in part, due to the differentiation between physical healthcare and mental healthcare. They are often discussed as two completely different disciplines, but, in truth, mental health IS health.
According to the Mental Health Foundation, “one in three people with a long-term physical health condition also has a mental health problem, most often depression or anxiety.” Physical health and mental health are two sides of the same coin and should be treated as such. If an employee can call out sick when they have the flu, they should also be able to call out sick due to an anxiety attack.
Employees should be able to take mental health days, and one way an employer can encourage that is by implementing a separate mental health policy. Having a separate bucket of mental health days can help encourage employees to recharge without forcing them to choose between taking a day or powering through a panic attack, just in case they spike a fever and need a sick day down the road.
This survey conducted by Breeze in 2022 indicates a number of interesting things, but most notably:
- 63% of employees have taken a mental health day in the last year
- Nearly half of all people who took a mental health day fibbed to their employer on why they needed the day off out of fear of being judged
- 50% of employees left their jobs in 2021 for mental health reasons, including 68% of millennials and 81% of Gen-Z
Adding a mental health policy to your business’ employee offerings is a great way to support employees and show that you care about their entire wellbeing. There is also the additional benefit that employees who take mental health days are less stressed, which results in long-term productivity. No one should feel embarrassed about taking a mental health day. Having a specific policy in place for mental health is a step in the right direction to end the stigma. Here is a great article that lists some other ways employers can implement a mental health policy to support employees and end the stigma. Remember, mental health IS health.
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Vendor Management Tips for Small Businesses
This article is from RISQ Consulting’s Zywave client portal, a resource available to all RISQ Consulting clients. Please contact your Benefits Consultant or Account Executive for more information or for help setting up your own login.
Small businesses often don’t have the resources or expertise required to conduct every necessary function. That’s where vendors come in; they provide access to expertise, products and services that help a business run. Establishing practices for managing vendors is important for small businesses’ overall success and long-term growth, but vendor management comes with its own challenges. Luckily, there are strategies small businesses like yours can implement to efficiently manage their vendor relationships in order to optimize processes.
This article explores vendor management, including its benefits, potential challenges and best practices that will aid small businesses.
What Is Vendor Management?
Overall, the purpose of vendor management is to build, maintain and strengthen relationships that are essential to an organization’s success, such as lowering costs or increasing output. Therefore, it is important to note that regardless of your small business’s vendor management practices, they require overall business discipline and coordination from different areas, such as HR, finance and leadership. This is because the key elements of successful vendor management include vendor selection, contract negotiations, onboarding, vendor performance monitoring, risk management and payment processes.
Importance of Vendor Management
Vendor management is important for several reasons, including having better vendor selection, streamlining contract management, creating strong vendor relationships, enhancing vendor performance management and creating overall better value. The end goal of vendor management is to strengthen a company’s success and overall market performance, improve efficiency and lower costs, all of which can help your business get the most value out of using vendors and achieve its short- and long-term goals.
Vendor Management Challenges
Despite the benefits to vendor management, there are challenges to consider as well. The most common vendor management challenges small businesses face include:
- Compliance risks
- Payment terms
- Data storage and security
- Reputation management
It’s crucial to have processes in place for your business to follow when working with vendors to avoid challenge-related threats. Working with vendors often includes sharing sensitive information, which puts your business at risk if you’re not careful.
Navigating challenges related to vendor management doesn’t have to be impossible. In fact, there are ways to make the process easier for your small business.
Vendor Management Best Practices
To navigate challenges and avoid risks, it’s important to develop established practices for your small business to follow when working with vendors. Consider some of the following best practices:
- Review contracts. It’s important to write formal documentation while working with vendors. This keeps both the small business and the vendor on the same page and accountable for any communication or financial transactions.
- Put all terms in writing. Put all terms and agreements between your small business and vendors in writing. This could include agreements regarding quality control, delivery times and communication expectations.
- Communicate regularly. Getting to know your vendors is essential; this means you must communicate with them on a regular basis. Respond to vendor communications quickly and address any issues in a timely manner. The more effective the communication lines are, the better the experience will be for both parties.
- Be selective. Every time a small business chooses to outsource, it has to navigate the risk of doing so. Therefore, it’s beneficial to avoid high-risk collaborations, such as vendors who process financial transactions on the organization’s behalf. It can also be advantageous to create a framework and policies that help deal with issues if they happen to occur to mitigate potential risks.
- Establish expectations. It’s important for small businesses to communicate their expectations to vendors. This means it’s important that you and the vendor are in frequent communication. Expectations can be built into the terms of the contract and mutually agreed upon before the partnership is finalized.
- Control costs. Before committing to working with a vendor, verify that the vendor’s pricing does not exceed your organization’s budget. All details pertaining to pricing, such as payment methods, billing frequency and rates, should be laid out in advance in the agreement between the vendor and the small business.
Summary
Working with vendors can be challenging, as there are a variety of moving parts for both the small business and the vendor. The way each business chooses to navigate working with vendors is unique, so what may work for one business may not be the best for another. However, by creating processes for your small business to follow when working with vendors, you can mitigate the risks you could face and establish a strong, successful vendor relationship.
For additional small business resources, reach out to RISQ Consulting today.
- Published in Blog
Employee Satisfaction With Benefits Falls to New Low
This article is from RISQ Consulting’s Zywave client portal, a resource available to all RISQ Consulting clients. Please contact your Benefits Consultant or Account Executive for more information or for help setting up your own login.
A recent study from Metlife found that an increasing number of employees feel they are not receiving the benefits they need from employers. Employee satisfaction with benefit offerings has fallen to 61% in 2023 from 64% in 2022, reaching its lowest point in the past decade of the study’s history. One significant reason for this decrease in satisfaction is higher employee expectations due to financial and mental health struggles in the wake of the pandemic.
“Feeling cared for at work is a key driver of employees’ holistic health and happiness, which are strongly connected to employee productivity and job loyalty.”
– Bradd Chignoli, senior VP at Metlife
In general, employees continue to expect robust traditional offerings such as health insurance, paid leave and retirement. But they have also heightened their expectations regarding modern benefit options, such as financial wellness and caregiving assistance. While employers have started to increase their benefit offerings to coincide with employee desires, most have not been able to meet the newfound expectations quickly enough.
What’s Next?
With employee satisfaction with benefits falling to a new low, it’s important employers reevaluate their benefits packages. When employee needs are met, employers are likely to find their workforce happier and more satisfied with their everyday tasks. Each organization’s employees may desire different benefit offerings, so it’s important to consider the needs of the workforce before considering what to offer in the future.
For more information on employee benefit satisfaction, contact RISQ Consulting today.
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Report: Managers Impact Employee Mental Health More Than Doctors, Therapists
This article is from RISQ Consulting’s Zywave client portal, a resource available to all RISQ Consulting clients. Please contact your Benefits Consultant or Account Executive for more information or for help setting up your own login.
A new report from The Workforce Institute at UKG revealed that managers impact employee mental health more than doctors and therapists. The study conducted for the report surveyed 3,400 people in 10 countries, including the United States, to explore mental health in and outside work.
Not surprisingly, work impacts employee mental health, and organizational leaders and managers can be critical in supporting workers. Consider the following key findings from the report:
- Work influences mental health the most, according to 60% of employees.
- Managers impact employee mental health (69%) more than doctors (51%) or therapists (41%).
- Managers have just as much an impact on employee mental health as a spouse or partner (69%).
- Mental health is valued over a high-paying job by most employees (81%), and 64% would take a pay cut for a job that better supports their mental wellness.
- Work stress negatively impacts employees’ home life (71%), well-being (64%) and relationships (62%).
The research also revealed that managers are often more stressed than their team members and senior leadership. Companies are encouraged to be inclusive with mental health support and not forget about managers in their efforts.
“Being overwhelmed consumes human energy and impacts retention, performance, innovation and culture. Employers can be the anchor of stability for their people by giving them the support and resources they need—not just what we think they need.”
– Jarik Conrad, executive director of The Workforce Institute at UKG
What Can Employers Do?
Workers want their employers and managers to do more to support mental health. They are also willing to make trade-offs for their mental health, as nearly two-thirds of employees would take a pay cut for a job that better supports their mental health. Fortunately, managers can play a vital role in supporting employees, which can bolster employee attraction and retention efforts. Employers can create supportive work environments by being authentic, building empathy and listening actively to employees.
Contact RISQ Consulting for additional mental health and employee communication resources.
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Minimum PTO Policies
This article is from RISQ Consulting’s Zywave client portal, a resource available to all RISQ Consulting clients. Please contact your Benefits Consultant or Account Executive for more information or for help setting up your own login.
Many employees do not use their allotted paid time off (PTO) despite their employers’ vacation and other leave policies. As a result, some employers are implementing minimum PTO policies to address this challenge. This emerging trend takes standard PTO policies one step further by mandating that employees take off a minimum number of days each year. When done properly, minimum PTO policies can help curb employee burnout, improve workplace productivity and strengthen attraction and retention efforts.
This article explores minimum PTO policies, including the potential benefits and organizational considerations for developing and implementing these policies.
What Is Minimum PTO?
Minimum PTO—also known as mandatory vacation or time off—is a policy that requires employees to take a minimum number of vacation days each year. While minimum PTO policies can vary by duration and the amount of time employees can take off, they generally take the form of an annual time-off minimum. These policies can establish deadlines for employees to use their PTO monthly, quarterly, seasonally or annually. Employees continue to receive their regular wages when taking time off.
Some employers require employees to take a portion of their minimum PTO over multiple consecutive days. This is known as a consecutive-day policy. For example, an employer may require employees to schedule five of their allotted 15 PTO days consecutively. This helps ensure that employees disconnect from work while away from the office, allowing them to use their PTO for something meaningful and return to work recharged. Consecutive day policies may also allow employees to take time off in smaller increments as long as they take one larger block of PTO each year.
Potential Benefits of Minimum PTO
Many savvy employers are transitioning to minimum PTO to help their employees feel happier and more satisfied at work, which can increase workforce productivity and reduce turnover. Minimum PTO not only encourages employees to use their allotted time off, but it can also strengthen organizations. The following sections highlight some benefits of implementing minimum PTO policies.
Improved Employee Well-being
Employees are an organization’s most valuable resource. By requiring employees to use their PTO, employers prioritize their workers’ mental and physical well-being. Minimum PTO can also help organizations strengthen employee loyalty since it can signal to workers that they’re not required to be online or work outside of expected hours. This can lead to employees feeling valued and, therefore, improve morale. Additionally, because minimum PTO policies help employees recharge, they can improve workplace productivity and safety. A rested workforce will likely be more creative, focused and careful.
Workforce Needs Evaluation
Mandatory PTO allows organizations to evaluate their workforce needs and reveal potential issues. By requiring employees to take time off, employers can learn whether a particular employee is taking on too many responsibilities and if they need to hire additional workers. It can also encourage cross-training by allowing workers to take on new responsibilities and gain experience when their colleagues are away. This can enable knowledge transfer among workers and decrease the risk of losing vital information and experience when an employee leaves. Additionally, since minimum PTO requires all employees to take time off, it can provide employees with opportunities to report workplace issues that they might not otherwise do due to fear or intimidation, such as harassment and bullying.
Reduced Cashflow and Rollover Issues
Minimum PTO policies can provide a positive alternative to use-it-or-lose-it PTO policies. Many regular PTO policies allow employees to cash out or roll over unused PTO at the end of the year. Cash-outs can create cashflow problems for employers, and rollovers can lead to scheduling challenges the following year. Minimum PTO policies can help organizations save money on year-end PTO payoffs by avoiding cash-outs entirely and limiting potential scheduling issues from rollovers.
Alternatives to Unlimited PTO Policies
Unlimited PTO can be a great recruitment tool and may seem ideal for employees, but, in reality, it can be problematic. Employees often struggle to strike a balance between an acceptable amount and an excessive amount of PTO under unlimited policies. As a result, many employees take less time off than they would if their employers adopted minimum PTO policies. As a result, unlimited PTO can cause employee burnout, decreased worker productivity and increased turnover.
Additionally, unlimited PTO policies can be ambiguous or poorly designed, making it more difficult for employees to take time off. Some organizations may have unspoken rules about using unlimited PTO. This is common in industries with demanding work cultures, like banking and finance. These unspoken norms often dissuade employees from taking time off because they may feel unsure or guilty about stepping away from work. By requiring employees to take time off, employers signal to workers and applicants that they value work-life balance, which can improve overall attraction and retention efforts.
Considerations for Implementing Minimum PTO
While minimum PTO can help employees feel happier and more satisfied at work, adopting this approach can create scheduling challenges. Minimum PTO policies require employers to plan ahead because they must address situations where employees may be out for multiple days. In addition to potential scheduling issues, minimum PTO can create hardships for employees by requiring them to increase their workloads when their coworkers are away. This is especially true for small teams and businesses. Employers can address these issues by establishing PTO blackout periods during peak times or predictable busy seasons. They can also train managers to address PTO requests during popular times, such as during the summer and holidays.
When establishing policies regarding PTO usage and blackout periods, employers need to be consistent with how they administer and approve time-off requests. Employers can do this by establishing a written minimum PTO policy that provides employees with details about how to use and request time off. This can include the minimum number of days employees must use each year, whether any days need to be consecutive and the deadlines for using PTO (e.g., monthly, quarterly and annual).
Organizations need to consider how minimum PTO policies may negatively impact employees. Requiring employees to take time off may cause some workers to feel like they’re losing autonomy because their employer is dictating when they must work and when they must take time off. Additionally, forcing employees to take time off can disrupt internal workflow, especially if employees must take time off during the middle of an important project or right before a critical deadline. This could lead to increased stress for employees and create work-related difficulties.
Employers must ensure their minimum PTO policies comply with federal and state law requirements, including timekeeping requirements under the Fair Labor Standards Act. Many states and localities govern how unused PTO must be handled at year-end or when an employee leaves a company. Additionally, legally mandated paid sick leave is becoming more common throughout the United States. Employers need to ensure that their mandatory PTO policies comply with state and local laws regarding paid sick leave.
Summary
Minimum PTO policies can help create a happier and more productive workforce. While requiring employees to take time away from work can benefit employers and employees, it’s vital that employers weigh these policies’ benefits and compliance costs before implementing them to ensure it’s the right decision for their organization.
For more workplace resources, contact RISQ Consulting today.
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4 Attraction and Retention Trends to Monitor in 2023
This article is from RISQ Consulting’s Zywave client portal, a resource available to all RISQ Consulting clients. Please contact your Benefits Consultant or Account Executive for more information or for help setting up your own login.
The labor market was a roller coaster in 2022 and will undoubtedly continue to evolve this year. It remains to be seen how the employment market will level out. Still, it’s a safe bet that employers will be challenged as they compete for top talent. Labor metrics indicate that even though the market has slightly improved from last year, it’s still a tight labor market as numbers remain historically high. While most employers project an increase in salaries in 2023, many will look beyond pay alone to help attract and retain more employees.
While some companies have been taking monetary actions (e.g., compensation and benefits packages) to address attraction and retention challenges, many organizations also are looking at ways to optimize their offerings and enhance employee experience. As they compete for talent, many may take a total rewards approach to fulfill employees’ workplace desires. This article explores four attraction and retention trends to watch in 2023.
1. Redesigned Flexibility
Remote work exploded at the height of the pandemic as most organizations shifted to this flexible work model out of necessity. Nearly three years later, it’s still at the forefront. Along with remote working arrangements, employers are offering hybrid options, flexible scheduling or even four-day workweeks.
Employees want the flexibility to work when and where they want. Employers have an opportunity to deliver on those desires and win over more workers. It comes down to offering the flexibility they need in their work and personal lives. On the other hand, many employers are striving to bring employees back to the workplace based on business priorities, so it’s essential to balance those organizational goals with employee desires for workplace efforts to be successful and well-received. While workplace flexibility is not feasible for every industry, organization and role, employers can evaluate their own situations and consider ways to develop flexible arrangements. The goal is to focus on output and productivity rather than time spent online or in the workplace.
2. Mental Health Support
Between the pandemic, inflation and job duties, more employees feel burnt out or are battling mental health challenges. As such, organizations are expected to take more responsibility for workers’ mental health and help employees on a personal level.
More employers will be considering how to take a proactive approach to employee mental well-being and resilience. A survey from the employee wellness platform Gympass revealed that nearly half of employees (48%) say their well-being declined in 2022. In addition, 28% say they are miserable at work. Health experts predict that employees’ mental health will continue to decline amid economic uncertainty, which means the demand for mental health care will increase in 2023.
Employers can offer benefits, perks and wellness programs that account for mental well-being. To address burnout and other well-being challenges, many employers will offer or expand their employee assistance programs, behavioral health anti-stigma campaigns and training for recognizing employee and peer behavioral health issues. Employers are poised to offer the education and support that today’s workers need and are looking for.
3. Learning and Development Opportunities
Learning and developing efforts have been on the rise in recent years. Not only are workers looking for professional growth opportunities at an employer, but many organizations are upskilling or reskilling workers, as it’s often less expensive to reskill a current employee than hire a new one. On the flip side, employees who receive learning and development opportunities are more likely to stay with the company and grow into different roles. Therefore, learning and development initiatives prove to be a win-win situation for employers and employees.
As employers go head-to-head in the competitive race for talent in 2023, upskilling their current workforces could be a solution to finding workers for their in-demand roles. Upskilling is when employers provide employees the opportunity to learn new skills to better their current work performance while also prepping them for the projected needs of the company. When upskilling employees, employers are investing not only in workers but also in the company’s longevity and development. Furthermore, organizations are prioritizing internal mobility to address skills gaps and strengthen employee retention.
4. Increased Focus on Belonging
Belonging is a critical component of company culture. At work, belonging is the experience of employees being wholly accepted and included by those around them. While belonging doesn’t necessarily come with a price tag, employers can invest efforts and resources into ensuring their workplaces are inclusive, collaborative and connected. Employees are looking for a work environment that’s authentic and accepting. A focus on belonging can play a crucial role in improving workplace culture and, in turn, improving employee attraction and retention.
Many workplace factors can impact employees’ sense of belonging, including (but not limited to) company culture, benefits offerings, communication methods, learning and development resources and mental health support. Any day-to-day interactions among co-workers and managers or companywide initiatives may impact workplace culture and the overall employee experience. When an organization develops a solid and positive employer brand as an inclusive and supportive workplace, it may easily attract new talent eager to join and contribute to the company culture. Employers can elevate employee experiences by creating workplaces where employees feel they belong and can be their authentic selves.
Summary
Employers can get ahead of the game in 2023 by monitoring the trends shaping the ever-evolving labor market and driving current and prospective employees’ needs and wants. While attraction and retention challenges are likely to continue this year, these trends demonstrate ways employers can elevate and strengthen their talent strategies to win and keep more workers.
Reach out to RISQ Consulting for more guidance on these topics and other employee attraction and retention trends.
- Published in Blog