8 keys to developing a successful return to work program
What does your return to work program look like? Read this blog post for 8 tips to developing a successful return to work program at your organization.
No matter the size of your organization, there’s about a 99% chance at some point dealing with employees going on leave. Most HR professionals are well-versed on the logistics of what to do when an employee is on short- or long-term disability — but what sort of culture do you have in place that encourages and supports them with a return to work (RTW)? Developing a positive and open RTW culture benefits not only the organization but the employee and their teams as well.
An effective RTW program helps an injured or disabled employee maintain productivity while recuperating, protecting their earning power and boosting an organization’s output. There also are more intangible benefits including the mental health of the employee (helping them feel valued), and the perception by other team members that the organization values everyone’s work.
See also: 7 Ways Employers Can Support Older Workers And Job Seekers
Some other benefits of an RTW program can include improvement of short-term disability claims, improvement of compliance and reduction of employer costs (replacing a team member can cost anywhere from half to twice that employee’s salary, so doing everything you can to keep them is a wise investment).
Some of these may seem like common sense, but I’m continually surprised how many (even large) organizations don’t have an established RTW program. Here are eight critical elements of a successful program.
1. Support from company leadership.
2. Have a written policy and process.
3. Establish a return to work culture.
4. Train your team members.
5. Establish an RTW coordinator.
6. Create detailed job descriptions.
7. Create modified duty options.
8. Establish evaluation metrics.
How employers can support employees during cancer treatment
Many people with cancer are choosing to continue working during their treatment. Read this blog post to learn how employers can support their employees during their cancer treatment.
Thanks to more sensitive diagnostic testing, earlier diagnosis and new treatments, the number of cancer survivors in the U.S. has grown to 15.5 million, and that number is projected to increase to 20.3 million by 2026. In addition, about 1.7 million Americans are projected to be diagnosed with cancer this year. A large percentage of these cancer patients and survivors are still active members of the workforce and the numbers have the potential to increase even more as people remain in the workforce beyond age 65.
Some people with cancer choose to continue working during treatment. Reasons for continuing to work can be psychological as well as financial. For some, their job or career is a big part of the foundation of their identity. A survey conducted by the non-profit Cancer and Careers found that 48% of those surveyed said they continued to work during treatment because they wanted to keep their lives as normal as possible, and 38% said they worked so that they felt productive. Being in the workforce also provides a connection to a supportive social system for many people and boosts their self-esteem and quality of life.
See also:
There also are financial benefits to the employer when employees continue to work during cancer treatment. Turnover costs, including hiring temporary employees and training replacement employees, are high. The cost of turnover for employees who earn $50,000 per year or less (which is approximately 75% of U.S. workers) average 20% of salary. For senior and executive level employees, that cost can reach 213% of salary. In addition, it can be costly to lose the experience, expertise, contacts and customer relationships employees have built.
This raises the question for employers: How can I support employees who choose to work while undergoing cancer treatment? Providing that support can be complex as employers work to balance their legal responsibilities under the Americans with Disabilities and Family and Medical Leave Acts with the privacy requirements of the Health Insurance Portability and Accountability Act (HIPAA).
When an employee chooses to share his or her diagnosis with a supervisor or HR representative, employers should view this disclosure as the beginning of a conversation with the employee taking the lead. (It’s up to the employee what information he or she wants to disclose about the diagnosis and treatment and with whom the information can be shared within the organization.) Here are four ways employers can support employees who are getting cancer treatment.
Help employees understand what benefits are available
The first step an employer should take is to refer the employee to the organization’s human resources manager (or someone who handles HR matters if the organization is smaller and does not have a human resources department) so that person can share information about all available benefits and pertinent policies. Provide details on:
- Medical and prescription drug coverages, including deductibles, co-pays, precertification requirements, network healthcare providers and plan and lifetime maximums
- Leave policies
- Flexible scheduling and remote work options, if available
- Employee assistance programs
- Community resources and support groups
See also:
Offer professional guidance
Offering patient navigator or case management services can also be beneficial. Navigators and case managers can provide a range of services including:
- Connecting employees with healthcare providers
- Arranging second opinions
- Providing evidence-based information on the type of cancer the employee has been diagnosed with and options for treatments
- Help filing health insurance claims, reviewing medical bills and handling medical paperwork
- Coordinating communication and medical records among members of the treatment team
- Attending appointments with employees
- Answering employee questions about treatments and managing side effects
Make accommodations
Workplace accommodations are another key pillar of support for employees working during cancer treatment. In addition to flexible scheduling, to accommodate medical appointments and help employees manage side effects like fatigue and nausea, and the option of working from home, workplace accommodations can include:
- Temporary assignment to a less physically taxing job
- Substituting video conferencing or online meetings for travel, which can be difficult for employees dealing with fatigue or a suppressed immune system, and can make it hard to attend needed medical appointments
- Leave sharing for employees who have used all their paid time off and can’t afford to take unpaid leave. Some organizations offer leave banks or pools where employees can “deposit” or donate some of their vacation days for employees dealing with a serious illness to use.
See also:
Employees may continue to need accommodations after treatment ends if they face late side effects such as fatigue, difficulty concentrating, numbness caused by nerve damage or heart or lung problems. Continuing job and schedule modifications can help mitigate the situation.
Ask for employee input
An often overlooked part of supporting employees who are working during cancer treatment is asking the employee what types of support he or she needs and prefers. Employees can share any medical restrictions related to their condition, what types of accommodations or equipment will help them do their job, and what schedule changes will allow them to attend needed appointments and recover from treatment. This should be an ongoing conversation because the employee’s needs are likely to change over the course of treatment and recovery.
SOURCE: Varn, M. (21 September 2018) "How employers can support employees during cancer treatment" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/how-employers-can-support-employees-during-cancer-treatment?brief=00000152-14a5-d1cc-a5fa-7cff48fe0001
Stop making 401(k) contributions. Fill up your HSA first
Open enrollment season is nearing, and soon, employees will be able to decide how much they want to contribute to their health savings accounts (HSA) next year. Read this blog post to learn why employees should contribute to their HSA before their 401(k).
With healthcare open enrollment season approaching, employees electing a high-deductible health plan will soon have an opportunity to decide how much to contribute to their health savings account for next year.
My advice?
Contribute as much as you possibly can. And prioritize your HSA contributions ahead of your 401(k) contributions. I believe that employees eligible to contribute to an HSA should max out their HSA contributions each year. Here’s why.
See also: What’s the best combination of spending/saving with an HSA?
HSAs are triple tax-free. HSA payroll contributions are made pre-tax. When balances are used to pay qualified healthcare expenses, the money comes out of HSA accounts tax-free. Earnings on HSA balances also accumulate tax-free. There are no other employee benefits that work this way.
HSA payroll contributions are truly tax-free. Unlike pre-tax 401(k) contributions, HSA contributions made from payroll deductions are truly pre-tax in that Medicare and Social Security taxes are not withheld. Both 401(k) pre-tax payroll contributions and HSA payroll contributions are made without deductions for state and federal taxes.
No use it or lose it. You may confuse HSAs with flexible spending accounts, where balances not used during a particular year are forfeited. With HSAs, unused balances carry over to the next year. And so on, forever. Well at least until you pass away. HSA balances are never forfeited due to lack of use.
Paying retiree healthcare expenses. Anyone fortunate enough to accumulate an HSA balance that is carried over into retirement may use it to pay for many routine and non-routine healthcare expenses.
See also: 3 things you should be telling employees about HSAs
HSA balances can be used to pay for Medicare premiums, long-term care insurance premiums, COBRA premiums, prescription drugs, dental expenses and, of course, any co-pays, deductibles or co-insurance amounts for you or your spouse. HSA accounts are a tax-efficient way of paying for healthcare expenses in retirement, especially if the alternative is taking a taxable 401(k) or IRA distribution.
No age 70 1/2 minimum distribution requirements. There are no requirements to take minimum distributions at age 70.5 from HSA accounts as there are on 401(k) and IRA accounts. Any unused balance at your death can be passed on to your spouse (make sure you have completed a beneficiary designation so the account avoids probate). After your death, your spouse can enjoy the same tax-free use of your account. (Non-spouse beneficiaries lose all tax-free benefits of HSAs).
Contribution limits. Maximum annual HSA contribution limits (employer plus employee) for 2019 are modest — $3,500 per individual and $7,000 for a family. An additional $1,000 in catch-up contributions is permitted for those age 55 and older. Legislation has been proposed to increase the amount of allowable contributions and make usage more flexible. Hopefully, it will pass.
HSAs and retirement planning. Most individuals will likely benefit from the following contribution strategy incorporating HSA and 401(k) accounts:
- Determine and make the maximum contributions to your HSA account via payroll deduction. The maximum annual contributions are outlined above.
- Calculate the percentage that allows you to receive the maximum company match in your 401(k) plan. Make sure you contribute at least that percentage each year. There is no better investment anyone can make than receiving free money. You may be surprised that I am prioritizing HSA contributions ahead of employee 401(k) contributions that generate a match. There are good reasons. Besides being triple tax-free and not being subject to age 70 1/2 required minimum distributions, these account balances will likely be used every year. Unfortunately, you may die before using any of your retirement savings. However, someone in your family is likely to have healthcare expenses each year.
- If the ability to contribute still exists, then calculate what it would take to max out your contributions to your 401(k) plan by making either the maximum percentage contribution or reaching the annual limit.
- Finally, if you are still able to contribute and are eligible, consider contributing to a Roth IRA. Roth IRAs have no age 70 1/2 minimum distribution requirements (unlike pre-tax IRAs and 401(k) accounts). In addition, account balances may be withdrawn tax-free if certain conditions are met.
The contributions outlined above do not have to be made sequentially. In fact, it would be easiest and best to make all contributions on a continuous, simultaneous, regular basis throughout the year. Calculate each contribution percentage separately and then determine what you can commit to for the year.
See also: Change to 2018 HSA Family Contribution Limit
Investing in HSA contributions is important. The keys to building an HSA balance that carries over into retirement include maxing out HSA contributions each year and investing unused contributions so account balances can grow. If your HSAs don’t offer investment funds, talk to your human resources department about adding them.
HSAs will continue to become a more important source of funds for retirees to pay healthcare expenses as the use of HDHPs becomes more prevalent. Make sure you maximize your use of these accounts every year.
SOURCE: Lawton, R. (19 September 2018) "Stop making 401(k) contributions. Fill up your HSA first" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/viewsstop-making-401k-contributions-fill-up-your-hsa-first
8 Benefits Of Measuring Employee Engagement
Are you measuring your company’s employee engagement? Measuring employee engagement helps companies attain real results and solve problems before they get worse. Read on to learn about the eight benefits of measuring employee engagement.
Employment engagement matters to achieving company success and developing employee skills and talents toward future goals. Happy employees equal a happy and prominent company. However, outdated traditional surveys used to measure engagement fail to reflect how modern employees operate and what they most desire and need to succeed.
Measuring employment engagement in real-time helps companies achieve real results, just as the importance of measuring finances and sales regularly do. Here are eight benefits of measuring employee engagement — much like taking your company's work culture temperature.
1. Solve Problems Before They Worsen
When you have a deadline, what can you do with issues that only now reveal their consequences? You have to deal with the issue quickly, and that often means putting a tourniquet on the problem and moving on. When you keep checking the temperature, you address issues — and their roots — before escalation occurs.
Problems only get big when you let them. Don't wonder why your employee retention and sales suddenly plummet.
2. Employ Empathy and Build Trust
Both employees and leaders need ongoing feedback to keep growing and improving. Make feedback a two-way process and communication that also stems naturally out of conversation and connection. Ongoing, open feedback allows leaders to pose better questions — especially those that relate to the company mission and vision.
When leaders ask good questions and connect, they build trust among employees and workflow improves as a result.
You may think your human resources department handles the human side of things, and that's that. However, thinking that way leaves your company out in the cold. It creates a negative communication gap between leader and employee, leading to #1 and risking you losing a talented individual.
Employ empathy and get the whole story when you see a struggling employee, whether their obstacle is personal or work-related. Everyone is human.
3. Make Morale #1
When employees disconnect, engage them in a meaningful conversation. It doesn't have to last the whole lunch hour — even a brief chat to check in will show you care. You’ll learn more about your employee's concerns, as well as their promise for the organization.
Make morale a top priority in your company, and you will reap the rewards. Productivity increases and you retain employees longer when their morale moves upward.
4. Share Insights Transparently
Back to those metrics. Use the analytics reports regarding workforce trends and finances to motivate your mission and, thus, your employees. Your employees need to be an active part of positive change-making. Employees feel more involved and valued when they know how and why they contribute to an organization and seeing the results drives them to push even harder.
5. Opportunity for Improvement
Surveys provide a snapshot of employee activity and thinking in a single moment in time as they struggle to think up thorough answers and complete the questionnaire to get back to work — or select variations of seven to nine on a 10-point scale to get it done. What does that measure exactly?
Snapshot surveys provide results that develop game plans months down the road. You can also measure social activities and interconnectivity at work to increase the ability to find meaning at work.
Encourage employees to keep track of their thoughts and feelings weekly and speak up. Better measurement tools — especially employee-preferred ones — increase opportunities for improvement and engagement.
6. Take Action When it Matters
Leaders can take action in small, cost-effective ways to engage their employees and improve morale, such as through conversation and opportunities to balance work and life.
Around 99 percent of meetings waste time, so take action as needed. Allow employees to think aloud in conferences and even be a little late, but start the session. When you have a strong work culture, employees and leaders collaborate and co-create to produce real-time, meaningful results.
7. Look for Trends
Technology allows employers to spot trends and take immediate action when used correctly. Does your website measure user experience for the customer? What about your employee's "user experience?"
When you identify trends, you can impact engagement in the day-to-day doldrums of routine. You make work meaningful and help the entire staff take responsibility for trends, as well as their engagements levels. Platforms like Slack allow employees to develop activity-based work styles that boost satisfaction scores, and engagement doesn't always equal productivity. So, deepen your definition of engagement.
8. Keep the Positive Flow Going
What chain reaction would you rather have — a negative one where issues worsen due to disengagement or a positive one where employees feel engaged and value their performance beyond getting a paycheck? Monitor your initiatives for employee engagement regularly, and keep what works going to maintain the positive flow.
Human resources don't begin and end in one department. Every department requires a human touch — your workers aren't drones or robots. They have real needs that, when met, can improve morale and lift up the company to success.
SOURCE: Craig, W. (18 September 2018) "8 Benefits Of Measuring Employee Engagement" (Web Blog Post). Retrieved from https://www.forbes.com/sites/williamcraig/2018/09/18/8-benefits-of-measuring-employee-engagement/#5b9bf20a7c55
The days of employers ignoring the opioid crisis are over
What do employers need to know to help their employees and help reduce the risk of the opioid crisis? The opioid crisis is affecting companies' productivity, medical claims, work injuries and their bottom line. Read this blog post to learn more.
Productivity, medical claims, work injuries, and the company’s bottom line — what do these things all have in common? They are all being drastically affected by the effects of substance abuse. The opioid crisis that is running rampant across the United States is having an impact on employees at every level.
As an employer, what do you need to know to support your employees and reduce the risk of this national crisis?
First, you need to educate yourself on the facts. According to the National Institute on Drug Abuse, every day, more than 115 people in the U.S. die after overdosing on opioids. It is not just the deadly heroin/fentanyl combination that we have been hearing about in the news, sources of opioid addiction include prescription pain relievers such as hydrocodone, oxycodone, oxymorphone, morphine, codeine, and other prescribed substances.
See also: Taking A Page From Pharma’s Playbook To Fight The Opioid Crisis
The Center for Disease Control and Prevention estimates prescription opioid misuse in the U.S. cost $78.5 billion per year; affecting medical spend, productivity, and law enforcement supervision.
Substance abuse does not discriminate on any demographic, however if your business is construction, entertainment, recreation, or food service, the National Safety Council found your employees are twice as likelyas the national average to have substance abuse disorders.
Secondly, you need to take action. The most important thing an employer can do is to have a proactive plan in place to help your employees live a healthy lifestyle. It is easy to get in the habit of saying “that does not happen here,” but the reality is substance abuse can — and does — happen anywhere.
Solving the opioid crisis won’t happen overnight, but here are some steps to take to build a better relationship with your employees and quite possibly help someone overcome a substance abuse problem.
Train your staff. Explain what resources are available to help them help your employees. If you have an employee assistance program in place, leverage it, and have the information easily available so any employee can access the information at any time. This will help lower the fear barrier for employees who are not ready to ask someone they know for help. If you do not have the right resources in place today there are many programs available, and it is important that you adopt one that will fit your culture and help employees be high performers.
See also: Employers take steps to address opioid crisis
Show employees you care. Look for signs and symptoms that an employee might have a problem with substance abuse. Make sure supervisors, managers, and team leaders are aware of these signs and what actions they should take. Have an open door policy, and make sure your employees feel they can ask for assistance when they need it. It is important to know how to handle sensitive, often painful, discussions in a professional and action-oriented manner. It is essential that you have the right steps in place to ensure leadership is aligned with the organization’s strategy on how best to help your at-risk population.
Be transparent. Have clear policies in place that promote a drug-free workplace. Consider expanding your drug testing panel to include opioids.
Share the savings. Consider sharing the dollars a successful well-being program will save your organization’s bottom line through lower prescription drug costs and less lost productivity due to illness and time away from work.
See also: A look at how the opioid crisis has affected people with employer coverage
If your organization is struggling with how to successfully address the challenges of substance abuse and opioid addiction, seek out employee benefit consultants to help you develop a strategy for success. Like anyone with an addiction, there is no shame in asking for help.
SOURCE: Panning, C (7 September 2018) "The days of employers ignoring the opioid crisis are over" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/employers-cannot-ignoring-the-opioid-crisis?feed=00000152-a2fb-d118-ab57-b3ff6e310000
Identity theft protection benefits and the business case for employers
Employees are turning to their employers for identity theft protection benefits with the rise in identity theft news. Continue reading to learn more.
With identity theft in the news constantly, many employees are turning to their employers to ask for an identity protection benefit.
Let us focus on productivity and wellness. Identity theft can wreak havoc on an employee’s personal and work life. According to SANS Institute, it takes an average of six months and up to 200 hours of personal time to resolve issues related to the theft. This includes hours calling banks, credit card companies, filing police reports, notifying the Social Security Administration, and alerting credit bureaus. Most of these calls and follow up activity must be made during business hours. According to ITRC’s latest study, 22% of respondents took time off of work when dealing with issues of identity theft.
Identity theft also impacts wellness and mental health. According to the ITRC study, 75% of respondents reported that they were severely distressed by the misuse of their information, and many sought professional help to manage their identity theft experience — either by going to a doctor for their physical symptoms or seeking mental health counseling.
These findings make it clear that identity theft directly impacts productivity and wellness. That is why comprehensive and compassionate restoration services should be a key element of any ID Protection plan offered by the employer.
Restoration services are the fixers in a comprehensive identity protection plan. For victims of identity theft, the restoration specialist will do the required work to restore the victim’s identity. Specialists make the calls during business hours, complete the necessary paperwork, and manage the process. They free up the employee to focus on their job, and alleviate the stress of dealing with the challenges of identity restoration.
There are a range of features to look for when evaluating restoration services across plans. Some plans only offer advice and information kits to guide members on what steps they need to take. Those services typically do not do the work for the member.
For plans that provide a full restoration process, consider if the plan provides victims with a dedicated restoration specialist as a single point of contact. Since the restoration process can take months or years, it’s best if a victim has a consistent person to speak with who knows the case and can provide periodic updates. Restoration services should be available 24/7 so victims can initiate the process immediately to lessen the damage. Plans should also provide multilingual specialists to best serve all members and handle all types of identity theft.
Although monitoring may alert individuals that are a victim of identity theft, the even greater value is in fixing the situation. Be sure to fully evaluate the restoration features of an identity protection plan as part of the selection process.
SOURCE: Hazan, J (31 August 2018) "Identity theft protection benefits and the business case for employers" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/identity-theft-protection-benefits-and-the-business-case-for-employers
Do employees know where to go in a health crisis?
Does your organization have a plan for employee health crises? Employees are often confused and unsure about who they should turn to for assistance when they have a health crisis at work. Read on to learn more.
When talking to employers about their disability programs, I often ask, “Who do your employees go to first for assistance when they have a health condition?”
If I ask that question of a direct supervisor, it’s met with a quick response of “Me!”, which is quickly followed by the statement, “My employees know that my door is always open and I’m here to help them!”
Sadly, this is not true. Another insurance company recently surveyed employees who experienced a health condition in the workplace and asked that same question: Who did you go to for assistance? The responses varied.
For example, we found that at midsize companies with 100 to 499 employees, it varied:
· 44% went to their HR manager
· 33% went to their direct supervisor
· 18% went to their HR manager and direct supervisor
· 5% went elsewhere
What this shows is that many employers don’t have a consistent process in place for addressing employees with health conditions. This confusion or misunderstanding about whom to approach for assistance can create an inconsistent process for your clients and their workforce — potentially resulting in a negative experience for employees and lost productivity for employers.
Based on the survey findings, employees who worked with their HR manager tended to have a more positive experience and felt more valued and productive after speaking with them about their health condition.
For instance, 54% of employees felt uncomfortable discussing their health condition with their direct supervisor, versus only 37% of employees who went to their HR manager. In addition, 73% of employees who worked with their HR manager felt they knew how to provide the right support for their condition versus 61% of employees who worked with their direct supervisor.
There are several reasons why working with an HR manager can be more beneficial for employees, and ultimately, your clients. Typically, working with an HR manager can lead to more communication while an employee is on leave. Our research shows employees who worked with an HR manager were more likely to receive communication on leave and returned to work 44% faster than when they worked with their direct supervisor.
HR managers also are usually more aware of available resources and how to connect employees to necessary programs to help treat their condition. HR managers who engaged their disability carriers saw a 22% boost in employees’ use of workplace resources, such as an EAP, or disease management or wellness program, when involved in a return-to-work or stay-at-work plan.
This connection to additional resources is essential, as it can help employees receive holistic support to manage their health condition — whether it’s financial wellness support, connection to mental health resources through an EAP or one-on-one sessions with a health coach. HR managers also are usually able to better engage their disability carrier to provide tailored accommodations, which can help aid in stay-at-work or return-to-work plans.
Providing your client with these findings can help them understand the importance of creating a disability process that puts HR as the main point of contact. Not only does this create a consistent experience that helps provide employees with the support they need, it can improve employee morale and reduce turnover.
SOURCE: Smith, Jeffery (16 August 2018) "Do employees know where to go in a health crisis?" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/do-employees-know-where-to-go-in-a-health-crisis
10 creative ways to help working parents
The parenting workforce is changing. Most working parents are concerned they won’t have enough time for their children. Continue reading to learn how employers can help working parents.
Can working moms have it all? Say goodbye to the broad-shouldered power suits of the ’80s and ’90s. Juggling a career and raising children is no longer a women’s-only issue.
While mothers are now the primary or sole source of income for 40% of American households with children, 75% of employees of all genders report their biggest concern as a working parent is not having enough time for their children. From single dads to same-sex couples, breadwinning moms to full-time working grandparents, the parenting workforce is changing.
No matter a family’s parenting makeup, employers can take an active role to help alleviate daily stressors affecting all working parents in the new, high-demand workplace. Here are 10 ways to do so.
1. Get real about childcare.
2. Offer flexibility.
3. Make it convenient.
4. Help tackle the “hate-to-do” list.
5. Promote total health.
6. Prioritize mental wellness.
7. Remember the older kids.
8. Simplify travel.
9. Don’t forget the “working” in working parents.
10. Stay inclusive.
Remember that caregiving responsibilities can encompass a wide range of family situations. Make sure programs and policies — as well as communications about them — support fathers, single parents, adoptive and foster parents, same-sex couples and grandparent-caregivers.
Being a parent is a rewarding and enriching experience — but it can also be exhausting and thankless, especially for those juggling work and family. Fortunately, it doesn’t take much to make the workplace a more supportive, less stressful place for working parents, who will likely return the favor with greater productivity, engagement and loyalty.
Shifting from employee engagement to employee experience
Employee experience is gaining steam and has many employers changing the way they view their employees. Read this blog post to find out more.
The way businesses view their employees has changed. From mere workers and resources, employers started adopting the mindset that they should give their employees benefits and values, instead of just extracting value from them. The concept of employee engagement applies to this. A lot of studies and researches came out on how employee engagement helps increase employee performance and profitability. Recently though, a shift is happening, with the term “employee experience” gaining steam.
What is Employee Experience?
So, what exactly is employee experience or EX? According to this article, employee experience is “just a way of considering what it’s actually like for someone to work at your company”. It is a holistic model. It includes what the employee experiences in the workplace and within teams—bringing together all the workplace, HR, and management practices that impact people on the job.
Why the shift?
Employee engagement tends to focus on the short-term. For example, there’s an upcoming engagement activity. Once the activity is done, what happens? Most likely, the employee returns to their work, the event just a memory until the next one.
The change in workforce demography creates new demands. The millennial generation, which currently dominates the workforce, have different priorities than the previous generations. The Generation Z’s are now also entering the workforce with a new set of expectations.
Making little changes that impact employee morale and motivation is important. Employee experience is more long-term and big-picture focused. Its scope, from an employee’s point of view, can be end-to-end—from recruitment to retirement.
The challenge of EX is immense. Fortunately, technology is on your side. Various HR tools have been developed to help you get the data that you need, as well as make it easier for you to design the programs you want. Deloitte lists down what you could do right now:
- Elevate employee experience and make it a priority
- Designate a senior leader or team to own it
- Embrace design thinking
- Consider experiences for the entire workforce
- Look outside
- Enlist C-suite and team leader support
- Consider the impact of geography; and
- Measure it
The best way to conquer the challenge of EX is by starting now!
SOURCE: Cabrera, A. (23 January 2018) "Shifting from employee engagement to employee experience" (Web Blog Post). Retrieved from https://peopledynamics.co/shifting-employee-experience/
What's the best combination of spending/saving with an HSA?
Health savings accounts (HSAs) are changing the way many people are planning for retirement. Do you know much about HSAs and what they can offer? Continue reading to learn more about them.
The old adage, “You need to spend money to make money,” is applicable to many areas of life and business, but when it comes to retirement, not so much. Particularly for people who are enrolled in retirement accounts, like the 401(k) or IRA.
After all, the more you’re able to fund these accounts on a yearly basis, the sooner you’ll be able to accrue enough money to retire to that beach condo or cabin in the backcountry. But in recent years, a newcomer has entered the retirement planning picture offering a novel new way to save money: By spending it.
The health savings account (HSA) has the potential to influence the spending/saving conundrum many young professionals face: Do I spend my HSA money on qualifying health care expenses (which can save me up to 40 percent on the dollar) or do I pay out of pocket for the same expenses and watch my HSA balance grow?
What many people don’t realize is that yearly HSA contributions are tax-deductible. So if account holders aren’t factoring in doctor co-payments, prescription drugs and the thousands of over-the-counter health products that tax-advantaged HSA funds can cover, they may be missing an opportunity to save in taxes each year.
By maximizing their contributions and paying with HSA funds as opposed to out-of-pocket, HSA users can cover products they were going to purchase anyway with tax-free funds, while using whatever is rolled over to save for retirement.
Spending more to save more. Who knew?
Here’s some food for thought that savvy employers should consider sharing with employees of all ages.
Facts about health savings accounts (HSAs)
HSAs were created in 2003, but unlike flexible spending accounts (FSAs) that work on a year-to-year basis, HSAs have no deadlines and funds roll over annually. HSAs also feature a “triple tax benefit,” in that HSA contributions reduce your taxable income, interest earned on the HSA balance accrues tax free, and withdrawals for qualifying health expenses are not taxed.
Account holders can set aside up to $3,500 (2019 individual health plan enrollment limit) annually and $7,000 if participating in the health plan as two-person or family, and these funds can cover a huge range of qualifying medical products and services.
HSAs can only be funded if the account holder is enrolled in an HSA-qualified high-deductible health plan (HDHP). If the account holder loses coverage, he/she can still use the money in the HSA to cover qualifying health care expenses, but will be unable to deposit more funds until HDHP coverage resumes. The IRS defines an HSA-qualified HDHP as any plan with a deductible of at least $1,350 for an individual or $2,700 for a family (in 2019 – limits are adjusted each year).
Despite their relatively short lifespan, HSAs are among the fastest growing tax-advantaged accounts in the United States today. In 2017, HSAs hit 22 million accounts for the first time, but a massive growth in HSA investment assets is the real story. HSA investment assets grew to an estimated $8.3 billion at the end of December, up 53 percent year-over-year (2017 Year-End Devenir HSA Research Report).
However, while HSAs offer immediate tax benefits, they also have a key differentiator: the ability to save for retirement. HSA funds roll over from year to year, giving account holders the option to pay for expenses out of pocket while they are employed and save their HSA for retirement.
If account holders use their HSA funds for non-qualified expenses, they will face a 20% tax penalty. However, once they are Medicare-eligible at age 65, that tax penalty disappears and HSA funds can be withdrawn for any expense and will only be taxed as income. Additionally, once employees turn 55, they can contribute an extra $1,000 per year to their HSAs, a “catch-up contribution,” to bolster their HSA nest eggs before retirement. When all is said and done, diligently funding an HSA can provide a major boost to employees’ financial bottom lines in retirement.
What’s the best HSA strategy by income level?
HSAs have immediate tax-saving benefits and long-term retirement potential, but they require different savings strategies based on your income level.
Ideally, if you have the financial means to do so, putting aside the HSA maximum each year may allow you to cover health expenses as they come up and continue saving for retirement down the road. But even if you’re depositing far below the yearly contribution limit, your HSA can provide a boost to your financial wellness now and in the future.
I’ve seen this firsthand. Before we launched our e-commerce store for all HSA-eligible medical products, we extensively researched the profiles of the primary HSA user groups through partnerships with HSA plan providers.
We then created “personas” that provide insights on how to communicate with different audiences about HSA management at varying points in the account holder’s life cycle, and these same lessons can be just as vital to employers.
The following contribution strategies are based on these personas and offer insights that could help employees get their HSA nest egg off and growing. These suggestions offer a means of getting started.
As employees receive pay raises and promotions, they may be able to increase their HSA contributions over time, but this can be a way to get their health care savings off the ground and then adjust to life with an HSA.
Disclaimer: These personas are for illustrative purposes only and in all cases you may want to speak with a tax or financial advisor. Information provided should not be considered tax or legal advice.
1. Employee Type: Millennials/Gen-Z with an income between $35-75k/year
For the vast majority of young professionals starting out, health care is not at the top of their budget priorities. However, high-deductible health plans have low monthly premiums, and by contributing to an HSA, an account holder can cover these expenses until the deductible is exhausted. For this group of employees, starting off small and gradually increasing contributions as income increases is a sound financial solution.
Potential Contribution Range: $1,000-$1,500
2. Employee Type: Full-Time HDHP Users Enrolled with an income between $35-60k/year
With many companies switching to all HDHP health plan options, a large contingent of workers find themselves using HDHPs for the first time. For this group, it’s all about finding the right balance between tax savings and the ability to cover necessary health expenses. Setting aside money in an HSA will allow workers to reduce how much they pay in taxes yearly by reducing their taxable income, while being able to pay down their deductible with HSA funds at the same time.
Potential Contribution Range: $1,000-$1,500
3. Employee Type: Staff with Families with an income between $75-100k/year
Low premiums from an HDHP plan are attractive for these employees, but parents will have far more health expenses to cover and more opportunities to utilize tax-free funds to cover health and wellness products. With more opportunities to spend down their deductible with qualifying health expenses and the resulting tax savings, parents should strive to put the family maximum contribution ($7000 for 2019) into their HSAs.
Potential Contribution Range:$4,000-$6,900
4. Employee Type: Pre-Retirement Staff with an income between $100-200k/year
Employees who are in their peak earning years have the greatest opportunity to put away thousands in tax-free funds through an HSA. So whenever possible, they should be encouraged to contribute the largest possible allocation to their HSA on a yearly basis. Additionally, employees age 55 and over can contribute an extra $1,000 to their HSA annually until they reach Medicare age at 65 to fast-track their HSA earnings.
Potential Contribution Range: HSA Maximum ($3,500 individual, $7,000 families for 2019)
What else should employers know about HSAs?
Employers can help employees get the most out of HSAs. Here are some tips:
- Employers should consider contributing to their employees’ accounts on an annual basis. Employer contributions to an HSA are tax-deductible, and this has the added bonus for employees of making it easier to max out their contributions annually.
- Remember: Employer and employee contributions cannot exceed the yearly HSA contribution limits ($3,500 individual, $7,000 family for 2019), so make this information clear to employees during open enrollment.
- If employees are still on the fence about HSAs, remind them that deductible expenses can be paid for with HSA funds, and yearly HSA contributions are tax-deductible for employees as well.
SOURCE:
Miller, J (2 July 2018) "What's the best combination of spending/saving with an HSA?" [Web Blog Post]. Retrieved from https://www.benefitspro.com/2018/06/08/whats-the-best-combination-of-spendingsaving-with/
