ACPM report showcases successful efforts
Creating an effective communication plan for retirement information at Caesars Windsor is no easy task. The casino is open 24-7 and employees are based in various locations, with shifts starting at different times ranging in duration from four hours to 12 hours.
“It’s very fast-paced and to be able to offer (a communication plan) from nine to five just doesn’t work,” said Tracey Riccardi, manager of compensation and benefits at Caesars Windsor in Windsor, Ont. “We wanted to make sure, in putting a program together, that it was something that would benefit everyone and there would be equal opportunity provided to all the members.”
In 2005, the company — which has about 2,700 unionized and 720 non-union employees — launched a three-year action plan to increase awareness of the defined contribution (DC) pension plan and how it works, encourage a sense of shared responsibility for the retirement planning process and ensure employees were confident enough to make investment decisions or know where to turn for help.
Central to the plan was a Pension Education Week that included seminars and 15-minute individual sessions with a financial consultant to review plan assets and re-balance investments to ensure employees were in line with their retirement goals.
“It’s very successful and well-received by our employees,” said Riccardi. “There’s a level of comfort in bringing people in, especially your plan administrator, who understand and know the plan, and having them be able to sit down with that member and log in to their account and say, ‘Here’s what you have, you’re on track with where you’re headed’ or ‘This needs to be tweaked here.’ They’ve really come to love that.”
The casino also conveyed the information in a quarterly newsletter, 10-minute briefings before a shift, buzz sessions, attachments to pay stubs, newsflashes on the intranet, town hall meetings and an on-site employee TV channel.
In the five years since the DC plan launched, union pension plan participation has increased from 88.1 per cent to 95.3 per cent and those maximizing the company match have grown from 57 per cent to 87.5 per cent. Among management, participation has gone from 89.9 per cent to 94.9 per cent and those maximizing the company match have gone from 75 per cent to 81 per cent.
ACPM roundtable on communication, education
The casino’s success — along with case studies from other plan sponsors — was shared with roundtable attendees participating in discussions around retirement plan communication and education. Set up by the Association of Canadian Pension Management (ACPM), the insights were compiled into an education initiative report.
Employers are using different ways to get the message out to members, said Dan Morrison, Calgary-based retirement leader at Towers Watson and a member of the ACPM strategic communications committee.
“I’m not sure any of them can be described as a huge success — they’re making inroads. More importantly, they’ve learned from lack of success on earlier initiatives and how to direct their energies, so there’s still a desire to better communicate how these programs work, better engage the members and get the members to take better control of their retirement savings.”
The challenge for a lot of the attendees is they’re not necessarily communication specialists, said Marcia McDougall, a market leader at Hewitt and chair of the ACPM strategic communications committee.
“They’re looking for ways that they can become more effective communicators even though that’s not their area of specialization. So it was a case of really backing up to square one and not just having a plan, which in some cases was really more of a timeline, but to actually develop a strategy and to think big picture and how this all tied in not only with pension plan objectives but perhaps as well the business plan objectives and work from there.”
Caesars Windsor is an example of a company that used multiple communication vehicles, from kiosk consultations with shift employees to posting information on shuttle buses that drove workers to the car park.
“They found really making it an event that was accessible for all employees at some point during their shift was the way to go,” said McDougall.
Providing funds of $200 to $300 for members to use the services of a financial advisor is another emerging trend, found ACPM. However, plan members who showed up for their session without having done their homework — detailing assets and debts — meant some plans sponsors found there was limited value.
But Caesars’ employees can’t really be unprepared, said Riccardi.
“We log right into their pension account, which offers everything: the type of investment options, their balances, the history of the transactions from employer’s remittance, everything.”
But a lot of people don’t know how and where to find a financial advisor and if an employer provides a roster of people, that raises concerns around liability for the quality of advice provided, said Morrison.
“There’s a fairly small minority of sponsors that are actually monitoring quality of advice and with privacy, that’s hard to do.”
Personalized communication works best
Plan sponsors that provided personalized communication such as an account statement or projected retirement income reported more positive feedback from plan members, found ACPM. A number of companies had expanded beyond communicating the pension plan to financial planning or retirement planning.
“Imagery was also a big concern for some of them, so this constant ‘Freedom 55, two grey-haired people walking on the beach,’ that sort of image was losing favour as well, partly because of a very diverse workforce and a diverse retiree population,” said McDougall. “So there was much more increased awareness of how retirement was portrayed as well.”
Targeted messaging is really coming into vogue, she said, to different demographics or career stages. That can mean promoting the company match to older employees or “negative framing” for younger employees — showing a member what he loses if he doesn’t participate.
“Segmentation is a growing trend and an important one because if you talk to people in adult learning, people learn in different ways, depending on educational background, learning styles and how the work day schedule is,” said Morrison.
But it’s an uphill battle with younger workers who may have other priorities for financial resources, such as paying off debts from education or starting a family, he said. So employers should recognize they may not see high engagement levels among certain groups.
Common communication methods include face-to-face meetings (group or individual), booklets and enrolment kits, retirement websites with calculators, webcasts, phone calls to new hires and those nearing retirement, annual reports and statements, web-based programs and closed-circuit TV, found ACPM.
While many sponsors are investigating or implementing online communication, many are still not quite ready to move to completely paperless communication, said McDougall.
More innovative solutions included a marketing campaign complete with a slogan and key messages. One sponsor launched a six-week campaign that started with a letter from the CEO, followed by posters, contests, emails and hard copy.
Using plan members as ambassadors was another method, to ensure workers have a good understanding of the plan. And one attendee created a “Financial Friday” program that featured a new website topic each week.
A lot of people were wondering about social media, whether it’s something to explore in the communications, said McDougall.
“We didn’t find it was necessarily the best vehicle but it depended on the membership of the plan.”
As for measuring the effectiveness of the communication efforts, this was not at all common, found ACPM. Direct methods included member surveys and evaluations around satisfaction levels, services and member recall, focus groups and feedback cards. Indirect methods included analysis of the funds members are in and how active a role they’re taking, comparing enrolment before and after information seminars, statistics on online communication (such as who opened an email and how long they read it), participation in the plan, the number of hits to a website or attendance at meetings.
Caesars Windsor spreads the word
To boost participation and understanding of its defined contribution pension plan, Caesars Windsor in Windsor, Ont., launched a three-year retirement communication plan.
Build awareness and understanding of the plan.
• Create review group and employee focus group to give feedback on retirement information materials and Pension Education Week.
• Develop monthly inserts for company newsletter.
• Send personalized letters to those not taking advantage of match program.
Increase participation in plan.
• Monthly “Pension Corner” in newsletter, with theme, pop quiz, prizes twice a year.
• Employee survey on what’s of interest in plan.
• Retirement sessions.
• Pension Education Week.
• Use online courses to educate workers on account management, including asset mix, investment funds and low fees.
• Pension Education Week.