Most business owners find themselves in uncharted waters as they attempt to rebuild their businesses from the impacts of the COVID-19 pandemic.
Among the countless challenges they face will be the need to reinvent many once-normal workplace duties and procedures, such as social distancing, face masks, sanitizing processes other health and safety concerns—and incorporate them into business operations.
Additionally, the pandemic has taken a financial toll on both individuals and business owners, which will surely affect their future planning and decision making regarding a wide variety of matters.
No one believes these challenges will be overcome easily. Although some businesses may not survive the logistical and financial setbacks brought on by the virus, many more will. However, the operations of a business going forward will likely look very different from what most looked like in the past.
Some may say a good deal of these workplace modifications were already in process, particularly those tied to technology, and the pandemic simply accelerated their proliferation and acceptance. Other necessary changes may not have been as visible before COVID arrived. In any event, it’s probably safe to say that the workplace of tomorrow will look very different from the traditional office we’ve all been used to in the years leading up to this time.
Assessing the Evolving Workplace Environment
As society struggled to adapt to the changing realities brought on by the COVID-19 pandemic, modifications were made to many aspects of everyday life that will most likely become to some degree, “the new normal”.
As it relates to employers and their workforce, the increased level of remote work and the added reliance on technology and online communications will surely be two of the more significant shapers of future business trends.
Obviously, neither of these developments represent new concepts, but the necessity to shelter in place during the pandemic only served to hasten a more widespread acceptance of both practices in businesses of all sizes. While we know the use of technology in business operations is sure to grow going forward, what remains unclear is to what extent employees are permitted to work from home.
At the very least, the future of many business operations will probably need to provide a flexible work environment. Both for employees with children at home and for those taking care of elderly parents, the ability to work from home could ease some of their pressures and allow for greater personalization of scheduling. Businesses could potentially save on expenses by downsizing office square footage and employees could save on commuting expenses—and more importantly, spend more time with family and friends as opposed to sitting in traffic.
Of course, there are other influences that will impact business owners in the coming months and years. The loss of revenue that many firms have experienced along with the pandemic’s impact on each employee’s personal financial health will exert significant pressure on many decisions that will be made by both employers and their employees.
Concern for the risk of contracting disease will weigh on everyone’s mind and heart and likely impact numerous facets of everyday lives, both at home and at the workplace. And the need for safety precautions such as social distancing, personal and workplace sanitizing, among others, will require adaptions to administrative practices and procedures, communication methods and customer contact that has seldom been seen on such a permanent basis before now.
Although employers might not rank their benefit portfolios among their greatest concerns as they look to re-establish operations, the reality is that the pandemic has powerfully reshaped many aspects of how the workforce thinks, the workplace environment itself and how people access medical care.
Pandemic-Related Financial Woes Mean Employers Will Demand Enhanced Focus on Cost Controls
Most businesses are being confronted by a one-two punch resulting from COVID-19 and face a tough road ahead. The combination of revenue loss due to office closures and lost customers, coupled with other unexpected pandemic related expenses are forcing business owners to slash costs. One such area they will inevitably focus on will be benefit expenses.
During the 2007-2009 recession, many employers directed their cost-cutting measures at shifting health care costs to their employees through higher contribution levels and high deductible programs. At this point, with individuals already further straddled with COVID-related financial impacts, any further burden put on employees has the potential to backfire. As a result, benefit planners need to be cautious in their approach.
This will require creative and new strategies to accomplish the goals set out by each client.
Today, fortunately, an expansive system of health care navigation, management services and technology all combine viable methods for accomplishing this task. By utilizing these avenues and integrating data concerning the client’s benefits budget, corporate benefit objectives, employee demographics and any utilization data available, a long-term benefit strategy can be crafted and tailored to meet the client’s needs.
Employers looking to maintain their employee benefit programs will need to achieve a balance between controlling their own costs, while also limiting the financial burden placed on their employees. Most likely, employers willing to continue providing an adequate benefit package may find employees more willing to consider new plan options or alternative means of seeking health care advice.
[To read more of Martin Levy’s thought leadership click here]
Most employees will be very appreciative that their employers chose to treat them well during this time when they struggled financially.
COVID Related Premium Increases: Should They Be Passed on to Employees?
While most industry professionals agree the COVID-19 pandemic will impact health insurance premiums, few have a grasp at this point on just how significant any increase will be. Until we know more, one question employers might want to consider thinking about is whether they should pass any increase on to employees.
Although many employers have traditionally passed a part of any premium increase to employees in the past, doing so at this time might not be a good strategy. Although bearing the extra cost for healthcare insurance might place extra weight on the employer’s bottom line in the near term, by looking at the long-term picture, there might be some solid reasons to avoid doing so. Here are a few points to consider:
- Although many employers have been impacted significantly by the COVID-19 crisis, many employees have suffered even more. In addition to the strain on their personal finances, some have also felt the pandemic’s effects quite emotionally through illness and deaths of those they love.
- Higher health insurance costs or increased deductibles and copays, especially during this time when their financial situation may already be compromised could lead employees and their covered dependents to skip preventive healthcare or necessary medical procedures. This in turn can have significant impacts on the employer, both in terms of productivity loss and higher healthcare costs down the road if and when any untreated medical conditions worsen.
- Many contemporary studies show that employee well-being is more likely when workers are engaged in a pro-healthcare office environment. Passing on increases or raising cost-sharing through co-pays and deductibles can sabotage the level of employee engagement and can lead to a reduced level of employee happiness and greater employee absenteeism and turnover, all of which can impact the employer’s bottom line.
Most employees will be very appreciative that their employers chose to treat them well during this time when they struggled financially. Employers should consider the benefits, increased employee productivity, enhanced loyalty and improved morale before deciding on whether they should pass on any COVID related increases to their workforce. When the economy does rebound, employees will remember how they were treated—and how some of their friends at other companies were as well.
[For more on CorpStrat’s approach to Life & Health click here]
Using Technology to Streamline Administrative Functionality
Since the pandemic will most likely compel employers to more closely scrutinize the dollars spent on employee benefits, a benefit administration could help maximize the overall utilization of benefits, streamlining many benefit and HR processes, reducing manual errors and increasing the level of employee engagement.
With more employees working outside the office, the ability to access critical benefit and HR information provided by most systems becomes an invaluable part of any employee benefit portfolio. Options exist for groups of all sizes, and generally include some or all of the following employee benefit features:
- Eligibility Management
- Onboarding
- Time and attendance
- Scheduling and performance reviews
- Employee Benefits Enrollment Capabilities
- Consolidated Carrier Invoicing
- Reconciliation of Insurance Carriers Invoices
- Compliance Resources
- Benefit Communication Modules
Whether part of a broad-based human capital management program or Human Resources Information Systems (HCM or HRIS), or as a separate, stand-alone tool, a benefit administration system can provide significant employer cost control opportunities.
In short, we are only beginning to understand the many pandemic-related influences that will shape the future of our community and business realities. Understanding the various changes manifesting themselves as a result of the pandemic and knowing how to reshape benefit strategies will be essential for any business to achieve successful solutions going forward.
