Magazine article Workforce Management
Comp/benefit Surveys Gauge What Workers May Trade Away
Most employers have run on the assumption that the more benefits they offered to employees, the happier their workers would be.
But in light of increasing health care costs and shrinking profit margins, a growing number of companies are rethinking that assumption. As a result, employers are surveying employees to discover what trade-offs in benefits and compensation they would be willing to make.
There is increasing pressure on HR executives and benefits managers to prove to CEOs and CFOs that the money they are spending on benefits is worth it, says Tim Glowa, a consultant with Hewitt Associates.
"Benefits costs are about to eclipse profits at many Fortune 500 companies," Glowa says.
At the same time, companies are starting to realize that in many cases, there is a huge gap between how much employees value certain benefits and the amount of money companies spend on those benefits, he says.
Hewitt estimates that typically $ 1,200 is spent per employee on undervalued benefits. The Lincolnshire, Illinois-based consulting firm, which has an online tool for clients to help survey employees, has seen interest in its product double every year for the past five years, Glowa says.
American Express is among the companies surveying for potential trade-offs. The New York-based company has conducted employee engagement surveys but noticed that compared with other areas, the company received lower rankings on compensation issues, says Timothy Nice, vice president of compensation at American Express.
"The questions we were asking were too general," Nice says.
For example, employees may indicate they want more compensation, but not what kinds of compensation they prefer. …