Would you rather have 10 dimes, four quarters or a one-dollar bill? If you ask a child, he or she might go with the 10 dimes because the more you have of something, the better it seems. Counterintuitive though it may be, the same can be said for adults. Studies have shown that people are more likely to fish for smaller denominations than break a $50 bill – even when the value spent is the same.
According to this theory, called “The Denomination Effect,” people prefer using smaller denominations over big bills in large part because they are happier when they have more options, like coins and smaller bills, to choose from instead of breaking a larger bill. Having those options seems to open up more possibilities, even when the money is the same.
For the enterprising human resources manager, this simple concept presents a unique opportunity to maximize both employee and employer happiness. Rather than taking a one-size-fits-all approach to their company’s benefits offerings, HR decision-makers can pursue comprehensive benefits packages with customizable features. That way, employers won’t end up on the hook for over-the-top insurance and employees can pick the benefits that fit their preferences, leading to a happier workplace. And while salary is still important in helping keep current employees and recruiting new talent, workers are increasingly looking beyond the paycheck and into benefits packages and perks as key drivers for staying with or joining companies.
In fact, according to our 2018 Aflac WorkForces Report, 55% of employees are at least somewhat likely to take a job with lower pay but better benefits. The modern employee base is growing ever more diverse and is not a cookie-cutter group, so why should their benefits be one size fits all? Below are four ways HR managers can pursue superior employee retention through diversified benefits.
What are the current trends in voluntary benefits? Download our briefing report — Trends in Voluntary Benefits — and discover how they are making a difference in recruiting and retention.
Make flexibility a priority — Added perks are a great incentive for retaining employees. Whether it is “Summer Fridays” or working from home once a week, employees value flexible work schedules. In its 2019 Hiring Report, the Execu|Search Group found that 71% of professionals said they would change jobs if they were offered flexible scheduling in a new role. Allowing employees to adapt their work schedule to their life schedule also helps increase their trust in the company. New working environments can help reinvigorate employees’ work ethic and creativity, helping ensure renewed drive and future success.
Development opportunities — Employees are always looking for new ways to learn. LinkedIn’s 2019 Workplace Learning Report indicated that 94% of employees would stay at a company longer if it invested in their careers. Investing time and resources into your employees can help their careers, employer-employee relationships and the bottom line.
Education should not be limited to learning new software or developing soft skills; it is also about acknowledging employees’ passions through different programs. Businesses can look to create opportunities for employees to engage with each other through mentorship and committees. Sometimes the best route is to ask them how they might like to grow.
Leave no benefits behind — Customizable benefits plans are increasingly attractive to today’s workforce. Our 2018 Aflac WorkForces Report found that job satisfaction rises from 65% for the overall population to 69% among employees of organizations where supplemental benefits are offered – and again to 75% among employees who are enrolled in those programs.
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Benefits are better when they are customizable, and supplemental insurance is one way that HR managers can ensure employees have the options they want. With supplemental coverage, policyholders receive cash directly (unless otherwise assigned) when they experience a covered injury or illness. That money can be used at the employee’s discretion, giving them freedom to choose.
Team up with technology — Technology can be your best friend or your worst enemy – and sometimes both in the same day. In the case of benefits administration, it is indeed your best friend. The tracking of employees’ schedules, time off and life changes is perhaps the most exhausting part of HR management. It is too often time-consuming and redundant.
That’s why a growing number of insurance providers, including supplemental providers like Aflac, offer their administrative systems at little to no cost to help streamline these processes for employees and the benefits managers. Technology-enabled solutions take away the stress of timekeeping and let HR managers get back to what really matters—supporting their employees.
Instead of asking employees to break a $50 bill every year during open enrollment, consider how you might give them the option to use ones, fives or tens if they want. That way, everyone is more likely to go home happy.