A recent article in Employee Benefit News examines an emerging trend of employers making changes to existing benefit offerings with the goal of increasing employee retention and boosting recruitment efforts.
While the article focuses on examples of companies adding new benefits, it also mentions the following example of a situation in which a current benefit is significantly underutilized:
For instance, one [employer], a large consumer products company, found that nearly 80% of its employees were oblivious to the fact that the company matched 401(k) elective deferrals.
It seems hard to believe – how could such a huge percentage of employees have no clue about something as basic as a 401(k) match?
The fact is, most employees are either too busy, lack basic knowledge or for some other reason do not focus on their employee benefits. So while by all means companies should make sure their total rewards offerings are competitive and up-to-date, the more basic task of educating employees on the total rewards they already have deserves greater attention.
For compensation and benefits to be effective, employees need to understand and appreciate the investment being made on the part of their employer. It’s human nature to like shiny new toys. But before comp and benefits professionals get too excited about the latest benefit trends (think student loan repayment or enhanced pet insurance), they should make sure to devote meaningful resources to educating employees about core benefits (like 401(k) plans) and work to make sure that employees take full advantage of these benefits. Sometimes the best gift you can give is reminding someone of the great things they already have. Not a bad lesson as we head into the holiday season.