Employers are grappling with many competing challenges in the post-pandemic new normal — from work transformation to the growing and urgent focus on employee wellbeing and resilience. The underlying question to all of these changes is — how are benefits financed, and what is the impact on cost?
Asia Pacific employers have faced escalating costs consistently for many years. In 2021, while cost pressures eased slightly, this was temporary relief before the trend springs back up. This presents a small window of opportunity to reflect on how to manage costs while providing benefits that are still relevant and aligned with evolving employee preferences.
The challenge for employers is clear: How can they offer the best, most relevant benefits while ensuring cost sustainability and quality?
This may seem a daunting question amidst the current business uncertainty, but employers can take a few steps almost immediately to set themselves up for cost sustainability, while ensuring benefits continue to meet employee needs, as well as the organisation’s philosophy and values.
01
The pandemic forced companies to meet urgent needs such as employee safety; benefits were quickly added or enhanced, sometimes without time to undertake due considerations of long-term viability and impact on cost. Now is the time for employers to step back and take stock of where they are. As a first step, they can assess the Total Rewards programs in place — not only from a design perspective but also from a utilisation perspective.
The current environment affords companies an opportunity to take a granular view of benefits and readjust programs to meet more relevant needs.
The current environment affords companies an opportunity to take a granular view of benefits and readjust programs to meet more relevant needs using a data-driven approach that can help to combat any negative repercussions.
02
Today, organisations are listening ever more intently to what employees are saying. Ironically, it took a remote work environment to make the voice of the employee louder and more valued! As the pandemic evolved in its waves and cycles, and employers entered the homes of employees via the work-from-home model, we saw that various family structures, backgrounds, and priorities meant that employee’s needs varied based on these criteria. Managers played a key role in learning employee preferences and ensured that the voice of the employee was heard not only formally but also informally.
Managers played a key role in learning employee preferences and ensured that the voice of the employee was heard not only formally but also informally.
Listening strategies include employee surveys, focus groups and manager-led team meetings. Some companies went even further and included employees in the design/redesign process, thereby creating not only a collaborative environment but a significantly relevant benefit set.
03
During the pandemic, companies rose to address challenges that had no playbook, benchmark or precedence. In doing so, an underlying company set of core values came to the fore. A heightened focus on employee safety and wellbeing shows the weight that companies put on human capital. Employers have an opportunity to create a baseline of benefits using their core philosophy and values as a guide. This creates a transparent and easily understandable core set of benefits and sets the stage for creating a more flexible benefit program in the future. This ensures that the baseline costs and their management remain a focus and that all enhancements can be considered as cost-sharing methods.
Employers have an opportunity to create a baseline of benefits using their core philosophy and values as a guide.
Once organisations achieve a deeper understanding of their current state and a blueprint for future benefits from a design perspective, they can then move towards building a sustainable plan. It will be key to define a set of core benefits (e.g., level of health care coverage, life cover, retirement contributions, time off) that provide a minimum level of security/protection.
And building on this core set, employers can:
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