Why Employees are Confused About Benefits, and What Employers Can Do

1. Preoccupied

Employees have many responsibilities at work and home. Often, they are preoccupied, thinking about how to pay their bills. They also are helping kids with their school assignments, solving work problems, or dealing with issues at home. They have little time to think about their benefits, which can cause confusion when they use their benefits.

Employees appreciate their benefits, especially the security the plans provide. Workers who have health needs and use their benefits tend to understand their coverage. But many more employees rarely use their benefits, even preventive care covered by their insurance benefits. Although these employees don’t think a lot about their benefits, they want to know they have excellent benefits that easily can be accessed when needed.

2. Overwhelmed

In the past, insurance benefits were simple in design with set coverage amounts. But as health benefits grew in popularity, employees requested more choices. As competition for talented employees increased, employers sought to provide flexible plans with more coverage options. However, employees may be easily confused about their benefits, because the descriptions and wording can be challenging to understand.

3. Confused

Most benefit plans have online websites and smartphone apps that employees are encouraged to use. Younger employees gravitate toward using the latest technology, but older employees may not. After trying to figure out these tools, some employees may give up and contact HR for assistance. Or they may ask coworkers or friends for help.

4. Uninformed

For many employers, benefits account for about 30% of employees’ compensation. So it’s unfortunate that most employees don’t take the time to sort through benefits information, so they know their plans’ coverage and features. If workers don’t know the value of their benefits, what the plans cover or how they work, they won’t use them. And when they do, most likely, they may be confused and need clarification.

When reviewing annual benefits options, employees tend to rush through the enrollment process. Research shows that about 73% of employees spend less than an hour, and 41% spend less than 30 minutes, reviewing plan information. Often employees choose the same plans and coverage levels year after year. They don’t take the time to explore new or updated benefits that may better fit their needs and those of their dependents.

How Employers Can Help

Employees tend to expect their employers to help them understand their benefits. And while workers want this information, employers must develop a strategy to get employees’ attention. Businesses must do more than send out packets and email enrollment reminders. Consider three ideas to improve benefits communication and avoid employee confusion.

1. Tailor messages

Most employers have four (sometimes five) demographic groups or generations of employees working at their business. Each has different benefits needs. Employers who provide the one-size-fits-all benefits information miss reaching their employees. It explains why 80% of employers say their employees don’t open or read their benefits information. To reach employees, employers need to tailor messages to each group. This communication strategy doesn’t have to be complicated. Employers just need to identify the benefits significant to each group of employees. Then customize communications to catch their attention. Learn more tips for selecting and communicating employee benefits.

2. Communicate clearly

Review current benefits communication information to ensure the information is clear and easy to understand. Ask other employees to read the descriptions to identify confusing terms. Include charts, graphs and examples to explain benefits, and educate employees on how to use them. If possible, provide short stories of how benefits have helped other workers. When a new benefit is offered, such as telemedicine, explain the value and how employees can use it.

3. Survey employees

Surveying employees is an excellent way to gather feedback. Conduct pulse surveys as issues arise, and regularly ask for input on benefits during the year. Since many employees work remotely, employers need to be aware of workers’ concerns and provide the right plans and perks to keep them engaged. After the survey, follow up with employees to say thanks and tell them how their responses will be used. Surveys give employees the opportunity to voice opinions or confusion about benefits.