It’s more than halfway through 2022; and after what seems like a long two years of working from home, it might be wrong to say that employees haven’t gotten used to it.
Not that work from home wasn’t a reality earlier, it’s just that working from home now seems more convenient, more productive (given there is no money and time spent in the traffic), and more inclusive. Not just WFH, in 2022 after the pandemic, employees have become more conscious about their health, upping healthcare costs by 6.5%.
Employers are even beginning to understand that there is more than just paid leaves and healthcare to offer to the employees. The elements of an employee benefit plan can be unlimited, given the different needs of the employees and the rising competition for talent which goes cross-industry.
Top 6 Employee Benefit Trends in 2022
While the list of benefits that can be offered to the employees is endless, the 6 employee benefits trends that are gaining traction in 2022 because of the hard year of the pandemic are must consider when developing a benefit and compensation plans for employees:
1. Flexible Work Arrangements
Work from home arrangements would have steadily become a norm if there were not a pandemic in 2020. However, the pandemic expedited the adoption curve of this trend. Now that companies have already quickly gone through the testing phase of WFH routines during the pandemic because of the urgency of the change, employees are now demanding flexible work arrangements which include a complete WFH model or even a hybrid model to enjoy the benefits of both WFH and on-site work.
This lifestyle change is regarded as one of the most important benefits that a company can offer apart from monetary compensation and other standard benefits including healthcare insurance, maternity leaves, etc. Therefore, offering flexible work arrangements to employees is the top employee benefits trend in 2022.
2. Mental Wellness
There has been a lot of talk about mental and emotional well-being in the workplace, especially after the pandemic when employees found it hard to cope with the post-pandemic lifestyles. The pandemic has caused 48% of organizations to focus on the mental wellness of their employees since it is now seen as an important part of overall employee engagement.
So, an organization that showcases that they care about their employees attract and retain talent more than the organizations that do not. Therefore, organizations are now working towards making discussions around mental health a part of the day-to-day routine so that it is normalized and the stigma attached to mental health issues and seeking mental health help is shattered for good.
3. Paid Leave Policy Shift
During the COVID-19, people had to take extended leaves due to contracting the virus or taking care of a family member who had contracted it. Therefore, there was a normalization of extended paid leaves.
Since employees who were offered this benefit during the hard times became increasingly loyal to organizations, the trend to offer an increase in paid leaves caught on to retain talent in the organization. And as employers are now branding as a team that cares for its employees, leniency in the paid leave policy is an obvious part of this overall branding effort.
4. Benefits for Diversity, Equality, and Inclusivity
DEI strategies are connected to increased employee engagement alongside an enhanced company image. In fact, according to a study conducted by Guardian Life, employees who are a part of a work culture that supports diversity, equality, and inclusivity alongside valuing flexibility and encouraging empathy report 70% better at wellbeing surveys than those who are not.
Therefore, employers continue to offer benefits to support their DEI strategy. This includes offering flexible work schedules for mothers and caregivers, supporting and onboarding small businesses as suppliers, and offering paid leaves for cultural and religious traditions.
5. Financial Wellness
One of the lessons hard-learned and wired in the employees’ brains during the pandemic is the importance of financial security. There has been a shift in the inclination to spend and people are now prioritizing financial security above all else.
There has been an increase in debt payoffs including student loan repayments and mortgage payments. Also, 75% of workers agree that they are more likely to stay on the job if the employer is offering financial coverage including accident insurance, low-interest loans, financial counseling, and student loan repayment (Source: Willis Towers Watson).
6. Offering a Customized Package
It is not debatable that all employees are different and have different needs. Therefore, one of the top 6 trends of employee benefits in 2022 also includes offering employees a voluntary or customized package according to their needs.
For example, someone who has significant experience and is nearing the end of their career might be looking for a company that offers retirement benefits. While a fresh graduate might be looking for a company that offers them student loan repayment benefits.
To meet the employee’s expectations and meet their needs, a customized benefits package is probably the best way to check all the boxes on the employee benefts factors list to keep them motivated and retained for a longer time.
Designing an Employee Compensation Plan
Designing a compensation plan should first and foremost consider the benefits that other competitors in the industry are offering. A comprehensive list of the most common benefits will reveal what needs to be done to meet the bare minimum or the points of parity.
Further, a look at the budget and expected tenure of the employee in the company based on the level of experience the employee is at and the industry average tenure also helps in deciding just how much to invest in a compensation plan.
Third, surveying the employees regarding their expectations helps design the perfect compensation plan for the employees. These benefits should be listed down in their contract so that they are well aware of all that is a part of their compensation package.
Summing it Up
There is a lot of buzz about employee benefit trends shift, especially in the post-pandemic world. This is because the employees and their lifestyles have changed to adapt to and accept a new world. They have become flexible owing to the uncertainty they have faced during the pandemic and expect the employers to reciprocate this change.
As such, flexible work arrangements have emerged as the top employee benefits trend in 2022 followed by an increased focus on employee wellbeing, an increase in paid leaves, and an increased focus on DEI when weighing employer options.
Designing a compensation plan should take into account the industry average, the budget of the company, and the employee expectations to increase the employee lifetime value along with an enhancement of the employer brand to attract and retain more talented candidates.
All in all, following the new benefit trends, is a great way to enhance the employer brand and cope with the changed thinking and lifestyle of the post-pandemic employee.