Honesty is the best policy for employee benefits

Strategy helps ensure optimal use of plan

For benefits managers, the phrase "Tell it like it is" should be much more than the title of a popular song; it should be the foundation of their benefit communications strategy, says employee benefits consultant Julie Frost.

"Years of focus group research that my colleagues and I have conducted tell us that employees want be treated like adults," says Frost, communications consulting practice leader in Detroit for Towers Perrin, a management consulting firm. Overwhelmingly, Frost says, the most common request employees have of their employers when it comes to benefit communications is, "Just tell me what you know."

Tell the whole truth

If you only put out an "edited" version of the truth, says Frost, you run the risk of having employees worry because they’re not getting the whole story. "And if you totally hold off and say nothing, you could create an information vacuum — a void that could be filled with fear and misinformation," she warns.

Direct, honest communication can not only increase the value employees place on their benefits, but it can directly impact business results by helping to increase productivity, says Frost. She notes that employees who are less distracted by benefits issues can concentrate more on their work. And employees who understand how to use their benefits stay healthy or get well and return to work sooner.

Explain what you can and can’t say

"Telling it like it is" doesn’t mean telling employees everything all the time, notes Frost. After all, that’s sometimes not legally possible. "There are times when you can’t say certain things, such as during merger and acquisition negotiations — but you can always say something," Frost explains. "You can tell employees you’re sorry about certain constraints but that you will be able to tell them more on such and such a date."

Frost relates the following experience: A client was introducing a new benefits program that included totally new plans. The employer announced it was going to introduce several new plans but that the cost was not yet known since negotiations with vendors were not yet finalized. However, the employer provided the employees with examples of typical plans of a similar nature.

In addition, the employer explained that as soon as more information was available it would be shared with the employees because they understood the employees wanted to know as much as possible before enrollment. "The [employee] reaction was wonderful," Frost recalls. "They were much more understanding and accepting."

Shaping employee perceptions

A properly crafted communications plan will help shape the way employees perceive their benefits package, notes Frost. "You’re imparting information and hope to shape perceptions as well," she explains. "You want employees to know the benefits are there and to understand them so they can use them. After all, either you [the employer] or both of you are paying for these benefits." (Frost recommends a five-step strategy for a winning benefit communications plan. See story, p. 118.)

One of the most effective ways of imparting benefits information is to put it in the context of the company’s business interests, its goals, and its vision, says Frost. "It will help increase the value an employee places on the benefits when you help him understand those benefits within the context of the business situation," she notes.

As for putting them within the context of the company’s goals, "any ‘side’ program should reinforce the company’s goals," she asserts. "Everywhere it is appropriate and reasonable, you should reinforce your corporate vision."

Finally, the most basic goal of the benefit communication program is to encourage a very specific behavior. "You want timely enrollment," says Frost. "You want everyone to pick up the phone and sign up."

[Editor’s Note: For more information, contact: Julie Frost, Towers Perrin, 1000 Town Center, Suite 950, Southfield, MI 48075. Telephone: (248) 208-1103. Fax: (248) 208-1111.]