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Inflation’s Impact on 2023 Open Enrollment

Many employees are currently feeling financially strained because of the impacts of inflation. The cost of everything has gone up in their lives — from the price of a chicken breast to a gallon of gas to healthcare. As Open Enrollment draws near and employees are poised to make their annual selections, we’re starting to see the impact inflation will have on the choices employees make in regards to their benefits.

Employees are feeling the squeeze.

According to The Hartford’s Future of Benefits Pulse Survey, 40% of U.S. workers reported that they will cut back on the Benefits they select during 2023’s Open Enrollment because of inflation. People are really feeling the squeeze on their finances — a lack of pay increases is made even worse by inflation — and as a result, they may make some tough choices to scale back when it comes to their Benefits selections. Without relief in the form of salary increases or help in increased employer contributions, many workers are expected to cut back on their benefits.

The perfect storm.

As an employer, the impact of inflation on their employees’ finances may make Open Enrollment more challenging than usual. Inflation has placed Employee Benefits at the forefront of many employers’ attraction and retention strategies. Employers have worked hard to put together creative offerings that are appealing. However, the combination of employers trying to ramp up Benefit offerings because they’re not able to offer pay increases that keep pace with inflation and employees not having as much spending power for said Benefits is creating the perfect storm.

What can employers do?

It’s important that going into Open Enrollment, employers take steps to help their employees better understand their Benefits options so they can make more informed decisions. This can help employees better protect themselves and their families in the upcoming year. Employers can assist employees this open enrollment season by doing the following:

Use multiple communication channels.
Employ clear language that features personalized messaging. Don’t just throw bullet points at them and expect them to absorb everything. Demonstrate how the insurance products relate to their lifestyle, financial security, and overall wellness.
Highlight the services that come with coverage. Employees often genuinely want to know that they’re choosing the plan that will benefit them the most. Sometimes, even when they choose the right plan, they don’t know how to optimize it. Communicate how they’re actually being covered and educate them on how they can best optimize these benefits.
Help employees look into the future. Finances may be tough right now and there are certain Benefits that they don’t absolutely need in the moment. Employers can help clearly communicate that cutting back on Benefits can actually place them in more financial harm.
Use creative storytelling. A lot of Benefits details can go over the majority of peoples’ heads. Create clear examples of what these Benefits might actually look like in real world situations that are relatable and understandable.
Listen to your employees year round. If your employees have specific feedback, take the time to listen. Try and understand what their pain points are so you can support them and retain your best team members.

Why clear communication matters.

Employers have the opportunity to simplify and personalize their open enrollment this year. This will help employees determine how best to allocate their potentially limited resources strained by inflation.

Let’s take the Health FSA Limit Increase for 2023 as an example. On Oct. 18, 2022, the IRS announced various inflation-adjusted tax limits for 2023, including the limit on employees’ salary reduction contributions to health flexible spending accounts (FSAs) offered under cafeteria plans. Many employees may not fully understand what this will mean for them. Increasing the FSA limit by 7% is meant to alleviate some financial concerns. In short: this increase can be helpful to workers. But without clear communication, many employees may overlook the details of this Benefit entirely.

By communicating effectively and providing employees with Benefits information through multiple communication channels, employers can help them optimize their resources and make the best benefits selections for themselves and their families during this period of financial difficulty.

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If you need help with your Open Enrollment, let’s talk. Email us at marketing@corpstrat.com

Why you need an ERISA Wrap Document today.

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If you’re a business owner, you’ve likely heard of ERISA, the Employee Retirement Income Security Act, which passed in 1974. ERISA is probably one of several acronyms you hear about all the time but likely don’t pay too close attention to. When a business provides Employee Benefit plans to its employees — this means medical, dental, vision — they’re doing so under the protection and guidance of the ERISA act.

What that means is the rules of ERISA need to be adhered to. Whether you like it or not, as an employer, you are a fiduciary. One of the rules under ERISA is fiduciaries are required to have a specific document that outlines employees’ rights. It’s called an ERISA wrap document and it takes all of your benefit plans and wraps them into one document.

What’s the big deal?

Many people think it’s not a big deal. Frankly, most employers don’t do it. But what can become a big deal is the fines you can face for not having an ERISA Wrap document. You might be thinking, “the fines aren’t that bad or “oh, it won’t be that much”. We’re here to give you a little wake up call and share what the fines can be.

Fines for not having an ERISA Wrap Document can cost $110/day, per employee until the document is produced under audit. Let that sink in for a moment. If you’re hit with these fines, they’ll add up very quickly.

You might think, “I’ll never get audited so I don’t mind taking the risk”. But in reality, here’s what can happen: An employee is terminated and they feel they were wrongfully treated or wrongfully terminated. So, said employee hires an attorney and they file a lawsuit. One of the first thing the attorney will do is call the EDD. Then EDD will be obligated to call the employer. And the first thing the EDD will ask for is the ERISA plan document, because they know most employers don’t have it.

The Good News

Fortunately, the cost to prepare these document is very reasonable. If you don’t have your ERISA Wrap documents prepared, reach out to us, we’re happy to talk you through it and help you get one. This simple step will greatly limit your exposure.

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Don’t put yourself at risk. ERISA Wrap docs are easy and affordable to set up. We can help you with them today. Email us at marketing@corpstrat.com for more information

Are You Creating Company Culture That Builds Retention?

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It takes a lot of effort to build culture, and it takes very little to destroy it.

A recent study revealed that 75% of workers cited Company Culture as the primary factor that influenced their decision to work at a company; for many, culture ranked higher than salary. It might be surprising to hear but job seekers are likely to pass on a “perfect job” if the Corporate Culture isn’t a good fit.

So what exactly is Corporate Culture and how do you create culture that builds retention. Read on to learn more.

What is Company Culture?

In short, Company Culture is simply the way things are done in an organization.

Every company has values, rules, and unspoken routines that make it a one-of-a-kind entity. Some are formal and some are informal but your culture bleeds into everything: the way you handle problems, the way employees interact with each other, and the way your leadership team carries itself.

It doesn’t stop there, culture also sets the tone for virtually every interaction your employees have with your customers. From emails to face-to-face interactions, your Company Culture is constantly on display in your employees to your customers. For your clients, it really doesn’t matter what you say to them, what you DO is what they’ll remember. This is why having a motivated workforce that both believes in the company mission and feels supported by their team is so key to building and fostering client relationships.

How do you build positive Company Culture?

Positive Company Culture trickles down to every aspect of your business. It can be seen in communications in your office, the way your team interacts, how your team behaves, and how your people connect with one another.

Good Company Culture will foster both engagement and retention. Conversely, bad Company Culture will emphasize punishment and reward the wrong behaviors. It’s hard to see how far reaching the effect of Company Culture is because its impact is both internal and external; intrinsic and extrinsic.

Signs of a bad Company Culture can look like toxic employee gossip, high turnover rates, and overall poor morale. If you’re noticing the beginnings to these behaviors, now is the time to act. Prioritizing Company Culture is a choice. It starts with hiring the right people to do the right jobs and continues with intentional effort. Building a great Company Culture requires thoughtful leadership, time, attention to details, and is not really based on compensation

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Building culture should be fun and rewarding. If you need help cultivating a positive Company Culture, reach out to us at marketing@corpstrat.com

What’s the hottest, zero cost benefit in Employee Benefit planning today?

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two coworkers meet to discuss voluntary benefits

The answer may surprise you. Hint: AFLAC

58% of Americans are living paycheck to paycheck after the inflation spike. This means that most of your employees are relying heavily on their paycheck to keep them from becoming financially vulnerable. If an employee falls ill or gets hurt, they’ll likely have little to no income coming in. On top of that, state Disability is so restrictive and can involve such an arduous process that your employees simply can’t count on it.

Voluntary Benefits

Voluntary Benefits, commonly referred to as AFLAC, can help employees maintain their income by paying cash benefits directly to them. Employees can use these cash benefits to help cover rent, groceries, and other daily living expenses while they’re out of work.

It’s true, major medical policies can be adequate for addressing most of your employees’ direct medical expenses. However, out-of-pocket medical expenses like deductibles, co-insurance, office visits, etc. aren’t covered by a primary healthcare plan and can still present a problem. These expenses add up quickly and can become an insurmountable financial burden for employees.

Voluntary Plans can help cover some of the large financial burdens employees face. Did we mention there’s no cost to you as the employer? Consider offering these plans to your employees on a voluntary basis:

Accident
Short Term Disability
Life, Dental
Vision
Cancer Expense & Critical Illness

Don’t forget, you can offer these programs on a pre-tax basis. This can help lower your FICA and FUTA contributions, making these plans even more affordable to your team.

We think Voluntary Benefits are a win-win for you and your employees and should be a part of any comprehensive Benefits Package. If you have any questions regarding how to get this set up, please contact us at marketing@corpstrat.com

4 Ways to Better Take Care of your People

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An organization really is nothing without its people. We’re big believers in cutting edge HRIS technology but if it’s not accompanied by great relationships, we know a company simply can’t thrive. We care about facilitating the right ecosystem in which your team can create relationships with one another that truly add value to both their work and overall well being.

We want companies and professionals to advance and thrive, and we believe the key to this is ensuring both your team and clients feel seen and appreciated. Here are four of our top tips for taking better care of your people:

1. Hire the right candidates.

This might sound like a no brainer but you’d be surprised at how easy it is to hire a “rock star” on paper who isn’t a team player. Take special care to check that your prospective hire matches your core company values. You want someone who is committed to having meaningful relationships in business and can relate their skills and expertise to the benefit of your organization. Hiring the right people is especially important if the position calls for interfacing with clients; every person you hire becomes a representation of your company and its values.

2. Take every opportunity to reward and recognize.

Employees are by far your greatest asset and it’s important to be intentional about making stellar workers feel appreciated. When your team members help a customer or client achieve their goals, make them feel seen and rewarded. Small things like a free lunch, holding a happy hour in their honor, or a gift card to their favorite coffee shop can have a big impact.

3. Don’t treat clients like they’re just business assets.

We strive to be an important ingredient in our clients’ success, but we never want to treat them like they’re just a number on the page. You never know where a solid client relationship might lead to. So many of our current friendships, business connections, and referrals have been the direct result of cultivating a genuine relationship with our clients. Encouraging your team to form relationships with their clients that are authentic, caring, and helpful pays off no matter what.

4. Create a culture that encourages lasting relationships.

We are always encouraged when our employees form strong relationships with one another. We know their strong connections make us a better team and allow us to work together better than ever. In addition, when our clients engage and form friendships with our team, we feel that it really completes the circle both emotionally and economically.

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We firmly believe that creating meaningful personal relationships goes beyond any sort of efficiencies technology can create. If this resonates with you, let’s talk. Call us (818) 377-7260 or email us at marketing@corpstrat.com.