Escalating employee benefit program expenses are an issue many employers face, but making cost effective changes without an employee revolt can be challenging.
By Steve Hettrick, ALCOS employee benefit specialist.
Escalating employee benefit program expenses are an issue many employers face, but making cost effective changes without an employee revolt can be challenging. As revenues are being squeezed ever tighter, the price of employer-sponsored health plans continues to increase with no end in sight.
Employers are often left with only one option to rein in healthcare costs – shift additional costs onto employees via increased premium sharing and higher out-of-pocket costs. However, if this message is improperly communicated, employers then face the problem of employee dissatisfaction and strained relations in exchange for their fiscal concerns.
The following steps can help make the difficult message a little easier to accept.
Clarify the Issue – Contrary to what employees may perceive, the issue at hand is not a benefits reduction. The real issue is the long-term survival of the company in a difficult business environment. Be sure that your employees hear this big picture perspective first.
Communicate Well in Advance of your Next Open Enrollment – When difficult news needs to be communicated, it is most effective to begin communicating the big picture early. Laying the groundwork for next year’s open enrollment should begin following the current open enrollment period and continue throughout the entire year. Sharing information about the challenges the company faces, and the fact that wise cost management is necessary for its perpetuation, can help employees understand the company’s situation.
There is no real advantage to being specific about benefit changes early in the communication process. The primary goal in the early stage should be to frame the employees’ perspective around the big picture. Once the benefit changes are communicated, employees should understand the situation and more readily accept the changes.
Identify Who Needs to Hear the Message Most – Certain employees are likely to feel more of the impact of benefit changes than others and are therefore more likely to vocally oppose it. Be sure to spend additional time in communicating to this segment. Disgruntled employees can spread their message very quickly. Stay ahead of them and work to proactively set the proper attitude within the entire workforce.
Repeat the Message Frequently – Repetition will help employees remain mindful of the big picture. Be sure to communicate through all available channels including town hall meetings, company intranet, payroll stuffers and email.
Respond to Employee Resistance from the Big Picture Perspective – Once plan changes are communicated, employees may resist the change. Management needs to respond compassionately, but continue to remind employees of the big picture, and help them not to perceive the changes as a personal attack. An employer may not be offering solutions that make its employees happy, but it will have succeeded if the employees at least understand that the changes are reasonable and necessary.
Remember to Communicate Your Care and Concern – Although a lot can be gained by communicating the big picture to employees, employers need to be careful not to ignore the personal aspects involved. Benefit changes can have a very significant impact on employees. Be sure to let them know that they are cared for and are vital components of the company’s ability to succeed.
ALCOS offers a variety of resources to assist clients with effective communication including paper booklets, online tools, articles and payroll stuffers. Contact your ALCOS employee benefit representative if you would like help crafting a strategy to help your employees accept benefit changes and help ensure the continued success of your organization.