Here’s the situation of many businesses today:
The USA (let alone the 🌎) has been grappling with COVID-19 for months with the expectation that the pharmaceutical community will produce a vaccine in 2021. Brick-and-mortar businesses have closed or operate at reduced capacity. Online businesses have doubled-down on marketing and fulfillment to support growing demand.
Everyone from health gurus to political pundits have taken a crack at trying to predict how and when the US markets will “recover” and regain the growth trajectory from the pre-COVID days. Despite significant impact to your employees personal and professional lives, they have risen to the challenges and uncertainties and proposed new and agile strategies, processes, and technologies to keep the business afloat, and maybe even grow. They are managing to keep their families safe, juggling kids (literally), and working full time. It’s been a remarkable journey and as a senior Human Resources professional, you’re more impressed and excited about your team than you have ever been!
And they are looking to your team for answers - the question is: What will you do to keep everyone moving forward?
This document will propose new ways of thinking about #remotework, #benefits, and what it means to be a #team.
The question that often comes up when you’re talking about employee benefits is “What’s the ROI?”
On the surface, it’s a simple question: What’s the value to the business once it has spent significant resources to set-up, onboard, and administer employee benefits? Scratch the surface and the answer gets complicated. Leadership teams may point to short/medium-term gains like new and novel solutions / products brought to market, realized opportunity cost, and competition in the market. But there are also significant long-term value in the investment in employee benefits.
Increased productivity: Whether you like it or not, know about it or not, your team brings their personal life to work. The most common “watercooler” conversations are on marital and dating life and new milestones reached by children and spouses, but studies show that when they get back to their desk it’s all about finances.
In a recent poll from The Ladders 36% of people check their bank account balance every single day. This means that roughly a third of your workforce is actively thinking about, perhaps worrying about, how much money they have in their bank account each and every day. An additional 30% are checking their bank account balance each week!
With the right benefits in place to support employees, they can focus more on their job responsibilities and focus less on their account balance.
Financial health = physical health: The age-old adage “Money buys happiness” is not completely incorrect. A 2018 study by Rockefeller University found that the 2008 Great Recession led to an increase in glucose levels and blood pressure levels in younger (first ten years of their career) and older (ten years from retirement) employees. When people are worried about their financial wellness, it negatively impacts their physical health. Businesses that support financial wellbeing of employees will see a decrease in sick days and PTO.
The impact of COVID-19 on #work cannot be understated and elucidating the differences for employees and their families is an exercise in contrast. According to McKinsey, “80 percent of people questioned report that they enjoy working from home. Forty-one percent say that they are more productive than they had been before and 28 percent that they are as productive.”
For example, let’s look at recruiting, finding new employees and talent management. Whereas most companies prior to COVID-19 looked for employees who live, or could relocate, to their headquarters, now employers can recruit talent globally.
Companies like Adobe, Amazon, Capital One, Facebook, Microsoft, Nielsen, Salesforce, Shopify and Twitter have all adopted a “remote-first” policy. The definition of a remote-first policy is a little different for each company, but in broad strokes means that the company has adopted a strategy, process, and technology to enable fully remote work for their employees. A shift to a regional, even global, talent pool requires an upgrading of the tools at your disposal your HR teams have to manage that population.
Alternatively, and once you have a workforce that is not coming into the office each day, how do you retain them? This is where employee benefits can be used as a tool to retain talent for the long term success of your business.
Top-tier businesses, like those mentioned above, leverage powerful technology to augment and enhance their connection to new employees. Gartner research suggests that there are few core attributes of companies that are winning the #talentwars:
The majority of US businesses have pre-tax savings plans today, but according to the Bureau of Labor and Statistics only 44% of employers participate in defined contribution plans. That means that 56% of employees are not in all likelihood not contributing towards a pre-tax retirement savings plan even though it’s available to them through their employer.
This begs the question: Why don’t more employees participate in employer sponsored plans and what can employers do to increase participation in their existing plans? The answer is that there is not a simple answer. The problem is complex and compounded by personal and professional attributes of each employee / employer relationship. Luckily, Otherhood was founded to solve this exact problem.
But first, let’s test your knowledge of the employment statistics:
The first step in increasing participation rates in your organization is with an effective onboarding and education program that teaches the employee which benefits are available to them, how they can enroll, and when they can access pre-tax contributions. It sounds simple but according to CNBC, nearly 56% of Americans don’t know how much they need to retire let alone how much they have in their retirement, healthcare, and education accounts today.
The good news is that Otherhood’s platform organizes and automates many of the manual tasks for HR teams in the onboarding process so they can focus on building a relationship with their new employees. For example, once employees have been onboarded to Otherhood’s Employee Platform, HR managers will immediately begin receiving valuable analytics about how many people are participating in their various pre-tax benefit accounts subdivided by role, tenure, income, or department. They can target nonparticipating employees with email campaigns or chats during open enrollment, or share education materials anytime to encourage signup. Otherhood’s HR Management Platform provides an x-ray view across your population in real time.
Employees receive similarly valuable tools in the Employee Experience Platform. They will see all savings accounts available through their employer including how much they have saved each month and in total. Rollovers from past employers, or independent retirement accounts, can also be synced with their dashboard to see all accounts in one place.
Employees can also now begin setting and tracking personal financial goals on an account by account basis or across multiple accounts. For example, let’s say your new employee has children and wants to enroll in a 529 account and save $5,000 each year towards future educational costs. Otherhood’s platform will calculate how much they should save each month towards that goal, how much they can save based on IRS guidelines, and begin tracking progress towards that goal.
Behind the scenes, Otherhood’s machine learning algorithms are inspecting federal and state contribution limits, regulatory guidelines, as well as specific aspects of the employees income and outcome to guide the employee towards long term financial health. Our recommendations are backed by nearly 50 years of employment data across millions of US workers.
Learn more on our website (www.otherhood.ai) or get in touch (email@example.com) with our team of financial advisors to see how you can increase participation, decrease attrition, and support your employees financial goals with Otherhood.