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Why you should invest in benefits communication

4 min read


This guest post is by Jennifer Benz, chief strategist and founder of Benz Communications.

Are you getting your money’s worth from employee benefits? Many companies spend 30% of their compensation budget on benefits such as medical, dental, insurance and retirement plans, but they might be skipping simple steps that ensure they get the full value from that investment.

Even though effective benefits communication is strongly linked to employee job satisfaction and loyalty, only a third of people think their company does a good job communicating their benefits.

This can put small and midsize companies at a tremendous disadvantage when competing with larger employers for talent because large companies invest tremendous resources in benefits communication. They build websites, hire external agencies to create multimedia campaigns and send copious amounts of print material home. The result is that employees understand, appreciate and — most importantly — use their benefits. Effective communication is the difference between an underused and underappreciated benefits program and one that gets high marks from employees.

Many employers underestimate the importance of benefits to creating and maintaining employee loyalty. In fact, employees rate benefits as a much more important factor in remaining loyal to a company than employers rate them.

Loyal employees aren’t necessarily those with the most expensive benefits. Rather, they’re employees who understand how to get the most value from their benefits because they received clear, open communication year-round. Employees who think their benefits communication educates them effectively are more satisfied and loyal: 71% are satisfied with their benefits, and 70% feel a strong sense of loyalty.

According to Prudential, 81% of workers rate a company’s benefits package as highly important to their decision to change employers or remain with a company. Benefits are important for younger workers, too. Sixty-four percent of younger employees say the quality of benefits enhances their loyalty to a company

If that’s not enough, strong benefits communication can help you reduce your health care costs — a line item that every chief financial officer is closely watching.

When you promote health and wellness to employees and their families, your workers make better choices about their benefits. They voluntarily move to lower-cost plans. They participate in wellness programs such as health assessments and biometric screenings. They use preventive care, disease management and other programs, improving return on investment. And, most importantly, you reach and educate families, who make up 60% to 70% of health care costs and often are the ones making key decisions.

In fact, McKinsey says the right benefits-communication strategy can reduce the cost of benefits by 10% to 20% a year.

Are you convinced? Where do you start?

If you’re convinced your benefits need a communication makeover, start by looking at a benefits website, a single home for all of your benefits information, on the Internet, outside your firewall. This is an absolute must for any company with more than 1,000 employees. But even companies with several hundred employees can benefit greatly from a site that pulls together key information and is accessible by employees as well as family members. (That is the reason using the intranet is not enough.)

Then, make sure you communicate year-round. Don’t only pile on benefits information during enrollment. Make sure the conversation continues when people are using their benefits. Help them understand how to get the most value from your programs. Remind them about visiting the website, and use whatever channels you can to give simple tips to use throughout the year. Use all communication channels in your organization, including in-person meetings, e-mail and on-site materials such as posters.

By putting a little extra effort into communicating benefits, you’ll create immediate results.