A quick summary:
I don’t need to tell you why good employee benefits are so important. But when it comes to selecting a good benefits package for your employees, how do you know what’s good and what’s bad?
From EAPs, to PMIs, to discount cards and cash plans, it’s pretty easy to get lost when it comes to the employee benefits market.
So allow me to lend a helping hand.
In this article we’re going to look at some of the most popular employee benefits solutions, how they differ and what’s best when it comes to choosing your employee benefits.
Understanding health cash plans employee benefits
Health cash plans, often referred to as cash health plans or cashback health insurance, are a type of employee benefit designed to help individuals cover the cost of everyday healthcare expenses.
Now, I don’t know about you, but talking about insurance isn’t the most exciting of topics. So I’m gonna break this down with some real world examples that are definitely not inspired by personal experience.
Let’s say you’ve been struggling with your eyesight recently. I mean, sitting in front of a screen in the office all day was going to take a toll eventually. So you book yourself an eye test. Surprisingly, the state of your eyes is not looking good so you chug some omega 3, and have a couple more eye exams that get pretty costly. Luckily your workplace has a health cash plan scheme (confetti!).
That workplace cash plan of yours can get you a nice reimbursement on the cost of your eye exams. Sure, you had to pay for it at the time, but getting the money back in your pocket later is better than nothing, right?
Let’s look at another example that again, are definitely not experiences I’ve had.
You’re preparing to cook some dinner in the evening, but you need something out of the freezer. So, you bend over, open the bottom drawer and… you throw your back out.
You know you’re in for a pretty painful few weeks. So, you head to the docs. Turns out all they can do is prescribe you some expensive pain relief medication. At least you can get the cost reimbursed by your workplace cash health plan, right?
Well, it turns out that the health cash plan doesn’t cover that, so you’re out of luck! (sad confetti)
The point is, health cash plans sound great on the surface. In practice, they only support employees who have a health ailment that is covered by the health plan. Everyone else is out of luck.
What’s more is that health issues can often be a personal matter. And a lot of employees just don’t want to share that personal info through their workplace, even if it means retroactive reimbursement.
And that leads on to my final point, health cash plans are retroactive. They don’t help your employees day-to-day, they don’t help prevent health issues, and they certainly don’t reward your employees for their hard work.
Health cash plan pros
- Save employees money on future and existing health issues
- Plans are often modular
- Can offer a range of other benefit options and are good for small healthcare bills
Health cash plan cons
- It’s insurance - they won’t cover everything, especially when things get pricey
- A lot of employees don’t know how to use them and make a claim
- It’s retroactive and doesn’t have a benefit unless an employee has a health issue
- Employees might be hesitant to share personal information about their health issues
I’ll rate health cash plans a 2/5.
Understanding Private Medical Insurance employee benefits
If health cash plans are good for small health bills, then Private Medical Insurance (PMIs) is all about the big stuff.
Often, it means you can get appointments much faster, get yourself placed higher up on waiting lists for some treatments, and also get things like private rooms.
For most of your employees, they’ll never use your PMI benefits. And really, that’s the point. It’s a benefit you’re offering your employees that you hope they’ll never need to use. For other employees, they’ll see this as a ‘nice-to-have’. And for a small number of your employees, they’ll consider this a ‘must-have’ since it can and has had a huge impact on the lives of people who have had health issues that benefit the use of a PMI.
But PMIs as employee benefits fall into a similar trap as health cash plans.
First of all, they are flexible plans, which means that the more you want to cover, the more pricey it’s going to be. This often means that you try to cover the most common or serious ailments that you can.
And this makes sense. However, just because you have a PMI benefit, doesn’t mean that your employees will be able to use it if they fall ill. Health issues can be a roll of the dice, and PMIs cover some, but not all sides of that dice - how many is up to how much you want to pay.
There’s also the consideration about employee benefits as a whole. The small minority of employees who are in the position to use the PMI benefit will find it amazing. Everyone else isn’t going to see it as an active workplace benefit - instead more of a solution to turning a very bad situation into just a pretty bad one.
Now that’s not exactly what I’d call a reward for good work.
PMI employee benefit pros
- Support employees through hard and difficult times
- Employees will be happy it’s there when they need it
- Looks good on job descriptions and can support candidate attraction
PMI employee benefit cons
- Its flexibility is its biggest weakness - it won’t cover everything your employees need
- It’s a reactive benefit, only helping employees after they’ve entered a difficult time
- Uptake is often very low - best case scenario is that employee’s don’t need to use it
For those who need it, PMIs can be huge. And so I’ll give PMI employee benefits a 3.5/5.
Understanding EAPs and discount card employee benefits
I’ve decided to group both Employee Assistance Programmes (EAPs) and discount cards together. But why?
Well, they both serve a similar purpose.
EAPs attempt to provide a wider range of support to employees so that they can continue to perform their best at work. Unlike PMIs and health cash plans, EAPs often focus on providing things like mental health advice, workplace stress support, and financial advice.
The problem is that numerous organisations with an EAP find that their employees just don’t use them.
They require you to promote and share details about the EAP and what is covered. As teams grow and change, EAPs often just fade into the background as a forgotten benefit.
What’s more is they raise privacy and confidentiality concerns among employees and are often simply implemented as a relatively cost effective solution to employee wellbeing.
It’s no secret that I don’t have a good perspective of EAPs. In fact, I wrote an article all about that.
The point is, they can look good on paper but just aren’t used by employees all that much, and they palm more responsibility over to HR Managers and business leaders.
And that’s where they overlap with discount cards. In fact, some EAPs increase their offering to include the same sort of “benefits”.
As the name suggests, discount cards can help save employees a bit of money on occasional purchases from stores.
While seeing a big list of shops where you can save some pennies looks great, the harsh truth is that no one ever remembers where they can get discounts.
Picture this, you attempt to get a discount at a shop only to find that it’s not included when you're at the till. And the amount of shops where you can get a discount is just a drop in the ocean to how many shops there are out there.
It only takes a handful of times of failing to get your discount before you just end up forgetting it exists and never using it again.
Now I wouldn’t exactly call that a good workplace benefit.
That’s the crux of both EAPs and discount cards: they’re all bark and no bite. And if you really want good employee engagement with your benefits offering, then EAPs and discount cards aren’t going to be your silver bullet.
EAP and discount card employee benefit pros
- They show that you’re trying to improve employee wellbeing so can support candidate attraction
- They can be relatively low cost
- There’s and endless sea of providers out there
EAP and discount card employee benefit cons
- Employees just rarely use them. They won’t improve your employee engagement
- They sound better on paper than they are in practise
- They can be complicated to use
- They hand responsibility to HR teams if they want value for money
- Employees might have privacy concerns and don’t want to feel “tracked” by their employer
Are they better workplace benefits than nothing? Probably. But the difference they are going to make is mostly negligible. I’d give them a 1.5/5.
So what are the best employee benefits?
There’s a bunch of smaller one-off benefits that I’ve not included here that employees can love or hate. Things like Gym Memberships, duvet days, birthday gifts… the list goes on.
The point is, from health cash plans to EAP’s and Gym Memberships, all of these options are rigid.
Every one of your employees is different and so while a Gym Membership might be the perfect benefit for one, it may be completely unused by another.
So the best solution is to give employees total flexibility over their wellbeing.
One way is to fork out the cash and offer a bit of everything. The problem is that you’ll drown yourself in platforms and providers that are liked by some and not by others. It’s costly, becomes a mess to manage for HR teams, and is a good way of dripping money down the drain.
The problem: employee benefits are made so complicated.
That’s where we come in.
We work with over 5,000 wellbeing and health partners that are all accessible to your employees to use. If they want a Gym Membership to stay healthy - then they can do that. But there’s so much more available from mental health support, therapy, fertility services, financial advice, fitness products, nutrition services - everything you need for total workplace wellbeing.
The point is, you can give your employees the choice on what they want their workplace benefits to be - all inside one online platform. All you need to do is decide how much you're happy for your employees to spend each month.
But we take flexible employee wellbeing a step further. With our AI powered recommendation engine, we actually learn what your employees want and share the services and products that are right for them.
And if employee engagement is a worry, we’ve got you covered. We take on the responsibility to ensure your employees are using the benefits available to them, keep them updated with new and popular partners, and help them if they ever get stuck.
So if you want total employee wellbeing, book a call with the team, and we’ll show you how.