Canadian employees would rather be given more time off than any other benefit — including a salary increase, according to a survey by Mercer.
“In Canada, generally speaking, organizations are running fairly lean, people are generally working pretty hard so, in some respects, it’s worker fatigue speaking,” said Brian Lindenberg, senior partner at Mercer in Calgary.
One-fifth (20 per cent) of Canadian employees said their most preferred benefit is one additional week of paid time off, found the global survey of 10,400 employees worldwide (with 1,033 from Canada). Canada was the only country to have paid time off at the top of the wish list.
A $500 salary increase came in as the second most preferred benefit for Canadians, with 18 per cent of employees picking this as their top choice, found the survey.
This shows cash is still king, said Lindenberg. It also shows employees may be focusing more on immediate benefits as opposed to ones that are more beneficial over the long term, he said.
Employers need to make sure they are educating employees on the value of some of the other benefits available, said Camille Coutu, senior benefits consultant at Jones DesLauriers Blevins Insurance Group in Barrie, Ont.
“(Employees) always want more cash but they don’t understand sometimes that some of the other benefits can be offered on a tax-free basis, whereas cash is always, always going to be taxed,” she said. “While you may want $500 cash, we could actually give you an HSA (health spending account) for the full value of $500.”
A $500 employer contribution to a retirement savings plan or a tax-free savings account (TFSA) came in third place, found Mercer, with 15 per cent of Canadian employees saying this is their most preferred offering.
When it comes to voluntary benefits paid for entirely by employees, auto (47 per cent), homeowner (42 per cent) and critical illness insurance (42 per cent) were the top three preferred by Canadian employees, found the survey.
“It does add value and it doesn’t cost an organization anything, really, and if they can partner with some large home and auto (insurance) organization that can provide preferred rates to their employees, why not?” said Bill Zolis, senior employee benefits consultant at the Callery Group in Whitby, Ont.
It is a bit surprising critical illness insurance made the top three because it is not a common voluntary or mandatory benefit, said Coutu. But these findings suggest employers may want to take a closer look at offering it, she said.
The preferences around voluntary benefits vary among the age, life stage and income level of employees, found the survey. While older employees prefer critical illness, supplemental life insurance and long-term care insurance, younger professionals prefer pet insurance and concierge services.
“Lots of people in their 20s have pets and the chances are high they may not have kids, so the pets are their kids. And what would be valued to them? An opportunity to take care of their dependants through pet insurance,” said Lindenberg. “That’s a great example of understanding what demographics are present in your workforce and what would resonate with them.”
Employers should strive to understand not just who their employees are today, but who they will be in the future as well, he said.
Then they can redesign the core benefits as well as the voluntary benefits on offer to better accommodate employees.
“It’s really just making it easy for the employee,” said Coutu. “Give them an à la carte menu to let employees go and shop and get what they want. It’s thinking outside that typical black box.”
Employers need to be more open-minded about the definition of a benefits plan, she said. They should be thinking about ways to offer flexibility to employees, such as flexible benefit plans or HSAs.
“When benefits plans were first in place, the reality was the man worked outside the house, he had a homemaker wife, 2.2 children and a white picket fence. So a traditional benefit plan, one size fits all, was perfect because the demographics were similar, the family composition was similar,” said Coutu. “Today, that’s all gone. We have three very different generations in the workforce who want very different things.”
To understand exactly what types of benefits employees are looking for, employers should survey employees. But they need to be prepared to implement some of the changes suggested, otherwise the survey can do more harm than good, said Coutu.
“You could actually infuriate your workforce more, so ‘They’ve heard me, but they haven’t done anything,’” she said. “You need to be very careful about what is the objective of the survey.”
Getting the message across
While it’s important to offer different options, employers have to ensure workers fully understand the benefit choices available and the consequences of making those choices, said Lindenberg.
For example, younger workers may need to be reminded about the importance of certain health benefits, said Zolis.
“At a younger age, you think nothing will ever happen to you, you’re healthy. But they don’t realize how many people could have cancer, MS (multiple sclerosis) — it doesn’t matter what age you are,” he said.
To communicate the many benefits available, employers need to make sure they are providing information in a variety of ways such as technology outlets, but also through paper-based means to meet the needs of all demographics in the workforce, said Lindenberg.
Employers should regularly send out newsletters, put reminders in pay stubs, offer lunch-and-learns and take any opportunity they have to remind employees of their benefits — because employees get excited initially, but then they forget what’s available, said Zolis.
Offering a wide variety of benefits options will not only help employers retain employees but also attract key talent, said Coutu.
“We’re just going to continue down this path. The generations coming up are going to want more, so if you’re thinking about taking away or scaling back, you’re not going to be following the trends,” she said. “You need to start thinking (about how to be) more creative, more innovative… If you’re not already thinking about it today, the reality is it might bite you in five years.”
© Copyright Canadian HR Reporter, Thomson Reuters Canada Limited. All rights reserved.