Corporate Wellness Program Proposal

Which costs your business more – staff who miss work or ones who show up physically but take a mental PTO day?

For most businesses, it’s the latter. So why do even savvy upper managers and finance directors (we’re not just talking about the bean-counters) worry about absenteeism while downplaying so-called presenteeism as a drain on company productivity, not to mention the compensation and benefits budget?

In some cases, upper managers seem to think that admitting that presenteeism even exists at the firm is akin to saying, “We’re a poorly run company.” In reality, presenteeism exists in every workplace.

Virtually every employee, manager, supervisor and executive who’s ever tried to “tough it out” at work when he or she’s been sick has been a presentee on those days.

So has anybody who’s ever been distracted at work by non-work issues – whether it’s spending the day trying to resolve a personal financial matter, checking on a sick child at home or constantly checking for scoring updates from a sporting event.

In brief, unless we’re to believe that every employee is productive every single day, no company in the world is immune from presenteeism.

A lot of organizations that don’t bury their heads in the sand about presenteeism still don’t track it. Why? Usually, there’s a belief that chronic presentees eventually get rooted out of the business.

And short of watching over every other employee’s shoulder throughout the workday, it’s too challenging (and even counterproductive) to attempt to estimate the cost to the corporation.

Here are some strategies that firms have used to not only measure the cost but also reduce the problem.

Creating a cost estimate

If your corporation is like most, upper-level management worries endlessly about health benefit costs without realizing undetected presenteeism is just as costly, but easier to control.

Consider these facts from a recent CSG study – Nearly 10% of the typical annually pay and benefits

budget is spent on non-productive (but treatable) employees.

Add in workforce who call out at the last second and the percentage rises to 17 percent, as reported by SHRM.

But how do you estimate the actual dollars-and-cents cost to your firm?

Let’s assume you have 50 personnel, who make an typical $40,000 a year. Over the while the year, the typical staff member is non-productive 2.5 % of the time, because of assorted personal issues or minor illnesses that serve as distractions.

In this instance, presenteeism costs your company $50,000 a year. When you have a 5% presenteeism rate, the figure shoots up to $100,000.

While it’s impossible to entirely stamp out presenteeism, even small reductions in presenteeism add up to large bucks in controlling compensation and benefit costs.

The next step, of course, is doing something about the issue. Broadly speaking, the process typically works in three phases -

o  review current policies and procedures for things that accidentally increase presenteeism

o  get supervisors and workers involved on the front end, and

o  stress the importance of work-life programs to upper-level management and supervisors.

Let’s look at each area to see how they work in real-life practice.

Unintentional effects

Three common ways many firms attempt to cut absenteeism often increase presenteeism -

1. Over-stressing attendance in employee’s annual reviews

2. Having supervisors check up on staff who take sick days to verify they’re really ill, and/or

3. Disciplining workforce for last-moment sick callouts.

From a practical and cost standpoint, the best solution could  be to switch from separate vacation and sick-day benefits to a single compensated time off (PTO) bank.

When folks have no-questions-asked control over their off days, they’re sometimes more likely to use a PTO day if they’re sick.  Of course, you know that PTO carries some risks of its own.

Early detection

Fewer than one corporation in 10 gets both managers and employees involved in the process of spotting and eliminating presenteeism.

That’s too bad, says consultant Mary Beth Chalk, because it can been done pretty easily.

Ask a sampling of staff to rate how energetic and productive they normally feel at work, on a percentage scale. Have supervisors estimate their staff as well. Then split the difference.

The result is a pretty good barometer of your organization’s current and future presenteeism risk.

Work-life balance

Anything you are able to do to promote work-life programs at your firm can have a positive effect on the bottom line. Proven ideas include -

o  rewarding supervisors who support flexible work arrangements

o  sending sick workforce home

o  cover onsite flu shots, and

o  Actively promote your existing Worker Assistance Program.

Any benefits HR/manager can adopt these ways to make personnel feel more appreciated.

The common thread –  using your own communication skills as a powerful tool for increaseing morale.

1. Put in face time

When time permits, managers may want to put in some “face time” with workers. This in and of itself is a kind of employee recognition. Example –  There’s a lot of value in simply walking around the building, chatting with workers.  Ask workers about the personal items they display at their workstations.

In the short-term, folks will notice and appreciate your interest.  Long-term, this may inspire ideas for rewards and incentive programs.  The same technique works at  firms with multiple locations.  Make a site visit to get a feel for the morale. This is much cheaper ?.” and often more effective ?.” than designing a formal benefits survey.

2. Send ?..em customized stuff

Looking for a simple way to show staff members that HR/Benefits cares? Develop a template from which you are able to send personalized “Welcome” letters to new hires or “Happy Anniversary” notes for employees’ business anniversaries.

3. Target overlooked employees

Most firms have employees (e.g. part-timers) who aren’t eligible for the 401(k), medical plan and other company-sponsored benefits.  Small gifts help firms connect with these often-overlooked employees.

Example –  on the first day of spring, send them a packet of flower seeds and attached a note from Benefits. Burston-Marsteller Worldwide has used this simple, low-cost idea and gotten good results.

Looking for recognition ideas that get results?  Here are two keys to success -

The most common characteristics of high-Return On Investment (ROI) recognition programs ?.” regardless of their monentary value ?.” are their spontaneity and perceived value by personnel themselves.

In reality, the cost of some of most effective spot awards and bonuses often amount to less than 1 percent of base pay ?.” and the awards don’t even have to be given in cash.

Less sense of entitlement

Part of the problem with traditional end-of-year or quarterly bonuses (apart from the fact that they cost corporations an average of 10 percent of base pay) is that staff expect to receive them for reaching certain objectives.

Sometimes personnel simply expect it no matter what. for  instance, at many firms, an annual holiday bonus is viewed as an entitlement and people  inevitably grumble that it’s not high enough. on the flip side, with spontaneous awards and bonuses, personnel are often pleasantly surprised.

Benefits advisor Ken Stahlmann spells out four keys to making the latter type of awards work, even if they’re lower in cost -

1. Creativity is crucial

The most effective programs usually give out awards weekly or monthly.  To avoid over-stretching the budget ?.” and avoid a ho-hum attitude setting in ?.” creativity is a must.

One way that never gets old –  combining time off with a second, non-cash award. Example –  One firm gives a half-day off in combo with movie passes once a month.

Another, at weekly staff meetings, holds a random drawing for a dinner gift certificate, plus permission to leave work early once.

2. Make it personal

Rewards have more lasting impact when they’re geared to people ‘s personal needs or interests. Two examples -

o  one firm with many foreign-born, low-wage workers awards a $20 pre-paid phone card after 90 days of service, and a $100 card for outstanding work, and

o  Another company with a lot of sports nuts took a few top-performers to a ball game. Managers said it was the best $200 they’ve ever spent respecting creating ongoing enthusiasm.

3. Add structure

The awards may seem spur of the moment, but top programs have a fixed budget and structure set before anything is handed out. Example –  One retail firm awards “points” for good work. Folks can then trade in their points for store merchandise.

By letting individuals  bank points for more valuable rewards, the business saw a solid jump in retention.

Other organizations prefer to let staff members reward each other. for  instance, a small health care provider keeps a “goodies box” on-site ?.” compensated for in petty cash and stocked by staff members themselves.

When someone spots a peer going the extra mile, he or she pulls out a prize and awards it.

The program is a immense hit –  It’s immediate and personal, yet structured.

4. Don’t let good intentions backfire

Most spot awards go over well. But keep these four issues in mind -

o  For most cash or cash-value awards, there are tax implications (just as with traditional bonuses)

o  Awards need to be spread around or else resentment can creep in

o  Be certain honorees don’t mind being the center of attention (some firms have accidentally alienated people  they tried to reward), and

o  Be sure the reward is something individuals  actually want. One firm that awarded a VIP parking space next to the Chief Executive Officer (CEO) found no one used it. No one wanted the Chief Executive Officer (CEO) knowing what time he or she came and left.

Looking for ways to improve morale, productivity and retention? Spot awards could  be the way to go.

They’re the most well-liked recognition incentives among staff, a recent study  shows.  The best part –  the incentives normally amount to less than 1% of base pay. That also can makes this option attractive to C-levels.  And the awards don’t even have to be given in cash.

Spontaneity grabs ?..em

Traditional end-of-year or quarterly bonuses cost corporations an average of 10% of base pay yet often have a lower payoff in morale and retention.

Reason – Staff Members appreciate them less because they expect to receive them for reaching certain goals. By their nature spot awards are spontaneous and compensated out immediately. Honorees are pleasantly surprised and see the corporation values their work.

Here are four keys to successful spot bonus programs, as reported by benefits consultant Ken Stahlmann -

1. Creativity is crucial

The most effective programs typically give out awards weekly or monthly.  To avoid over-stretching the budget ?.” and avoid a ho-hum attitude establishing in ?.” creativity is a must.

One way that never gets old –  combining time off with a second, non-cash award.

Example –  One firm gives a half-day off in combo with movie passes once a month. Another, at weekly staff meetings, holds a random drawing for a dinner gift certificate, plus permission to leave work early once.

2. Make it personal

Rewards have more lasting impact when they’re geared to people ‘s personal needs or interests. Two examples -

o  one firm with many foreign-born, low-wage personnel awards a $20 pre-compensated phone card after 90 days of service, and a $100 card for outstanding work, and

o  Another firm with a lot of sports nuts took several top-performers to a ball game. Managers said it was the best $200 they’ve ever spent respecting building ongoing enthusiasm.

3. Add structure

The awards may seem spur of the moment, but the most effective programs have a fixed budget and structure set before anything is handed out.

Example –  One retail firm awards “points” for good work. Folks can then trade in their points for store merchandise. By letting people  bank points for more valuable rewards, the business saw a solid jump in retention.

Other companies prefer to let staff reward each other. for example, a small health care provider keeps a “goodies box” onsite ?.” paid for in petty cash and stocked by staff themselves.

When someone spots a peer going the additional mile, he or she pulls out a prize and awards it.

The program is a huge hit –  It’s immediate and personal, yet structured.

4. Don’t let good intentions backfire

Most spot awards go over well. But keep these issues in mind -

o  For most cash or cash-value awards, there are tax implications (just as with traditional bonuses)

o  Awards need to be spread around or else resentment can creep in

o  Be certain honorees don’t mind being the center of attention (some firms have accidentally alienated people  they tried to reward), and

o  Make certain the reward is something individuals  actually want. One firm that awarded a VIP parking space next to the Chief Executive Officer (CEO) found no one used it. No one wanted the Chief Executive Officer (CEO) knowing what time he or she came and left.

In the last few years, there’s been a lot of publicity about the fast-growing crime of identity theft. More than half happen in the workplace. Benefits and compensation files are the most vulnerable targets.

The scariest part –  Victims of benefits-related ID theft often make out worse than those who fall prey to the more common variety.  The bad guys are ahead of investigators after such thefts occur, and are often very good at covering their tracks.

Moreover, because benefits ID-theft is a relatively new kind of crime, there’s no well-established system for victims, plan sponsors and providers to set things straight after the fact.

401(k) accounts a prime target

Not surprisingly, employees’ 401(k) accounts have become the main target for benefits thieves.  An alarming MSNBC news report showed just how easy it may be for thieves to tap into an employee’s 401(k) accounts – If an internet based account gets hacked into or account paperwork falls into the wrong hands, it takes only several mouse clicks to wipe out the victim’s retirement savings.

With typical credit-card or bank account fraud, victims need only call their card issuer or bank, report the crime and refuse to pay for an item. But 401(k) theft is much, much harder to resolve.

Three immense obstacles -

1. Money in 401(k) accounts isn’t federally insured, like a bank account.

2. 401(k) accounts rarely ?.” if ever ?.” come with automatic identity theft protection from the provider, like credit cards.

3. Even when the theft is successfully resolved, the situation becomes an ERISA nightmare for plan sponsors, because your corporation also has to account for the way the theft affected the growth of the employee’s account before the money was restored.

A lot of EAPS fall into a common – and hazardous – category –  Management thinks the program is excellent, but workforce think it’s a waste. But it doesn’t have to be that way if you’ve an EAP or are considering one.

Seventy-three percent of all firms (59 percent of small employers) have an EAP. But how well does the average employee assistance program work? Not as well as we’d hope. A Mid America Coalition on Health Care study found -

o  just 50% of 6,400 workforce surveyed said they’d use the employee assistance program (EAP) if they felt overwhelmed by personal issues, and

o  one-third said they didn’t even know how to access its resources.

The good news –  Firms like yours have seen dramatic improvements in three relatively simple steps

1. Employee attitude surveys

The best beginning place –  Take the pulse of your staff members with a short, confidential attitude survey.

Objectives –  Ask workforce when they know how to use the EAP’s resources. Then test workers’ knowledge and opinions of depression and other personal issues that may affect their workplace performance and/or safety. In the final section, determine how workforce would handle a serious personal issue.

In other words, find out where your individuals  would likely turn for help. Would workforce seek out the EAP? Would they prefer to discuss the issue with their family doctor? A mental health professional?

The Mid America Coalition’s survey remains an excellent design model from which to craft a recent survey for your own employees.

2. Promote employee assistance program (EAP) through education

Your survey data should help you pinpoint areas where employees need more education about your EAP. Some awareness-boosting techniques that have gotten results -

o  Lunch-and-learn sessions. Possible topics include dealing with personal-finance stress, caring for elderly parents, understanding depression or dealing with a dependent who has potential mental health issues.

o  Employee newsletter. If you have a benefits newsletter, spotlight the EAP from time to time. Many businesses without newsletters have done e-mail campaigns or targeted mailings instead.

o  Workplace posters spotlighting EAP.  The ones that work best are often posters designed around a specific theme (e.g., anxiety about personal debt) rather than a general “need help?” message. In addition to posters, you could want to distribute wallet cards with employee assistance program contact info.

Need help finding educational material? There’s lots of free EAP-related flyers and FAQs here. Do not forget –  When doing employee assistance program (EAP) education, constantly remind personnel that the program is strictly confidential.

3. Make sure to work with supervisors

For legal reasons, supervisors need to tread carefully when they suspect an employee has a mental health issue.

What you don’t want –  supervisors taking disciplinary actions without consulting HR or playing amateur psychologist and “diagnosing” the employee’s problems. Here is a PDF of some proven tips and talking points for doing supervisor-specific employee assistance program education.

HIPAA compliance –  Beware non-discrimination issues

HIPAA’s non-discrimination rules impact both psychological health benefits and general health plans. Under current interpretations, medical programs can no longer have benefits exclusions that deny benefits for injuries resulting directly or indirectly from pre-existing psychological health issues.

That’s true even if the psychological condition wasn’t diagnosed until after the injury and even if the injury was self-inflicted. Example –  Suppose an staff member gets hurt in a workplace accident he or she caused. After the fact, the staff member is diagnosed with a mood disorder that previously escaped detection by the employee’s physician.

Under current regs, HIPAA-covered plans can’t deny benefits. This puts employers in a bind. Mental health issues like depression, anxiety or bipolar disorder are one of the medical conditions that’re most likely to go undiagnosed or underdiagnosed.

That’s why, in most businesses, having a strong employee assistance program is one of your best compliance tools.

For a lot of workforce, telecommuting and flex-time are highly desired work-life benefits. But a growing number of businesses are reluctant to offer these programs.

Demand for these benefits remains high.  One study found that 87% of job applicants are familiar with the idea behind telecommuting and flex-time, and the majority express a desire to have at least periodic access to such programs.

Environmental interest groups have pushed the feds for years to develop incentives for employers to encourage telecommuting.  The pressure has risen as gas prices have continued to soar.

Notwithstanding, flex-time programs have leveled off in some sectors, and there’s been a decrease in telecommuting.

Today, about half of all businesses where telecommuting is feasible permit staff to work from home on a case-by-case basis. But the percentage of companys offering full-time telecommuting has dropped in recent years.  Nowadays, only about 20 percent to 25 percent of companys offer the benefit year-round.

Even some national businesss that are well-known for their telecommuting programs have scaled back. AT&T, for instance, recently asked several thousand home-based workforce to come back into the office.

Hewlett-Packard and Intel have done the same thing.  and the federal government lately noted a 7.3% drop in telecommuting staff members. Why the cutbacks?

Worker Assistance Program – Pros and cons

Offering personnel telecommuting or flex-time may be a good recruiting and morale-improveing tool, as well as a way to retain personnel who need to relocate, would otherwise have a need to quit or take leave or commute long distances to work.

But the programs are not without their drawbacks. Some of the main reasons businesss give for scaling back or eliminating them -

o  Business culture – It’s easier to build a sense of organizational stability and an individual connection between employees, colleagues and supervisors when individuals  interact face-to-face on a daily basis.

o  Security – Among the hidden costs of permitting staff members to telecommute (or else come in early or stay late) is keeping sensistive information safe. Some the cutbacks are being driven by companies’ IT departments.

Especially, managers have raised concerns about stolen laptops, identity theft or other crimes driven by hackers gaining access to information via workers’ home Internet connections.

o  Productivity – A lot of supervisors find it easier to ensure high productivity when everyone is working under one roof at the same time.  There’s also a widespread view that most staff get things done faster and more accurately when they’re not distracted by things at home.

The bottom line on the bottom line

Work-life programs like flex-time and telecommuting remain a useful benefit to offer workers, and a lot of organizations still provide these benefits for economic reasons.

But once the potential hidden costs are weighed, it’s often better for the bottom line to limit the scope of these programs.

Organizations that are thinking about beginning a telecommuting program should look closely at job descriptions and telecommuting candidates. Some positions are poorly suited for remote work, and some workers are more up to the challenge than others.

But unless the corporation creates objective criteria for permitting or denying flex/telecommuting requests, such programs can actually damage morale.

The last thing any business wants is to open supervisors(and the company) up to accustations of favoritism or discrimination because of seemingly random decisions on which employees in their department can and can’t flex their schedules or work from home.

In the near future, the federal government might offer help to businesss looking to start a wellness program.  The help would take the form of tax breaks to offset wellness program costs.

A current USA  Senate bill would give businesss a substantial tax break for starting health promotion programs. Dubbed the Healthy Workforce Act, it calls for an business tax credit of up to $200 per staff member enrolled in a newly developed health promotion program.

For bigger firms, there is the $200 credit for the first 200 employees and up to $100 per worker thereafter.  To qualify for the full credit, your health promotion program would’ve to feature -

o  health risk assessments

o  staff member education drives (e.g., targeted mailings, web-based tools)

o  behavior change programs (e.g., use of tobacco cessation, weight control, health Coaches), and

o  ”meaningful” participation incentives (e.g., lower co-pays).

Qualified employers would be able to claim the tax credit for up to 10 years after beginning a health promotion program.

The bill has enjoyed bipartisan support, but like many things in Washington, the parties disagree over how to fund the cost of the tax credit.  As a result, it’s been bogged down in committee.

If and when the bill is ratified, businesss could claim the federal tax credit the following year.

In the meantime, whether or not your business already has a formal health promotion program, there are proven ways to make wellness part of the business culture. Best of all, they don’t have to cost an extra cent.

Wellness town meetings

It’s often said that successful wellness programs begin at the top of the organization. Reason – Staff Members choose up fast on whether upper-level management practices what it preaches when it comes to wellness.

When the people  in executive management are smokers, obese or simply reluctant to talk about health issues, it’s a tough sell to get employees engaged in taking control of their health.

That’s the idea behind the wellness town meeting.

Once a week (or once a month), everybody in the company attends a short meeting to discuss their own recent efforts to get healthier.

Managers normally go first, for break the ice about discussing some potentially sensitive issues like dieting or quitting smoking.

In most businesses, the meetings are arranged to encourage casual, free-flowing conversation.

One key – Individuals  speak from where they’re seated, rather than standing up front, with all eyes staring at them.

Some companies take a more formal approach, which can also work.  For example, at Old National Bank in Indiana, folks file into an auditorium to face their worst enemy, the scale.

Each week, everybody at the firm ?.” from seasoned managers to the newest hires ?.” comes in to get weighed.  The only one who sees the number on the scale is the person getting weighed. Even so, the health promotion program has inspired a lot of folks to lose weight.

Free tests and screenings

While there’s no substitute for having workers undergo comprehensive health risk appraisals, it’s also wise to home in on screening for common conditions that aren’t necessarily lifestyle related.

Example –  skin cancer. It’s not just sun worshippers who are at risk of the most common (and in its early stages, treatable) form of cancer. Heredity plays a part. So does luck.

Fortunately, businesss can get their staff members screened for free. Through the American Academy of Dermatology’s National Melanoma and Skin Cancer Screening program, volunteer physicians perform skin cancer screenings at no cost.

Similarly, other medical associations and public health agencies offer free or nominal-cost screenings for a variety of other common conditions.

In truth, it varies.  In some cases, an HSA-eligible plan may cost the same as a non-HSA high-deductible plan. In others, the premiums can actually be more expensive, a recent NHPI report locates.

As a matter of fact, a non-HSA plan offering similar coverage can carry a monthly per-employee premium that’s about $15 to $25 lower and a deductible that’s $500 to $1,000 lower than the HSA choice.

Sometimes the difference is due to price-jacking –  the HSA plans are the ones that’ve been hyped in radio commercials and mentioned in newspapers in recent years.

Nowadays, fewer individuals  exploring high-deductible plans ask first about the non-HSA, so insurance corporations sometimes slash prices to drum up interest in those options, too. Another factor –  Not all deductibles work the same.

Deductible cuts both ways

Two deductibles can look similar but work differently, and the cost scales can tilt for either an HSA or a non-HSA plan. Example –  HSAs by law can no longer allow first-dollar coverage of prescription drugs. But a non-HSA plan can.

On the flip side, HSAs often feature better preventive-care coverage. In some non-HSA plans, a individuals who’s yet to meet the deductible must pay out of pocket for standard tests (example –  cholesterol testing) that’re part of the routine physical. Only the office visit itself is covered.

Also, HSA-eligible plans have to follow rules that limit total out-of-pocket costs. But this can push up the premiums compensated on the front end.

Best bet –  Double-check with your broker to make certain you’re comparing apples to apples when investigating  the costs of HSA and non-HSA plans.

When your organization has this common ?.” and increasingly well-liked ?.” fringe benefit you could be at legal risk without even knowing it.

Some organizations have an onsite staff member fitness room as part of a formal wellness program. Others simply do it as a way for folks to get their juices flowing before work or blow off steam afterwards.

No matter the reason, businesses with fitness rooms need to be aware that the benefit isn’t risk-free.

Over the last few years, a few privately owned fitness centers have been sued ?.” and agreed to expensive settlements ?.” after exercisers suffered sudden cardiac arrest (SCA) and died before help arrived. In each case, the facility either didn’t have lifesaving equipment on the premises or didn’t have personnel properly trained to use it.

Some legal experts have expressed concern that businesss could also be at risk if the unthinkable happened on organization premises while an employee worked out.

SCA is of particular concern. Reason –  Even seemingly healthy, active adults are at risk of sudden cardiac arrest. It can’t be prevented. There’s no vaccine.

And few victims survive by the time an ambulance arrives. But there is a way to save the employee’s life and potentially save your firm from a lawsuit.

Learning about SCA

Sudden cardiac arrest (SCA) is a frequently misunderstood killer. It’s different thing as a heart attack. SCA can affect anybody, anywhere, anytime. It occurs more than 600 times every day in the USA, killing at least 250,000 people  each year.

The only hope –  using a device called an automated external defibrillator (AED) within 10 minutes.

The good news is any individuals at your corporation may be quickly trained to use an AED ?.” you don’t need any medical knowledge to use it.  The training may be obtained for free through a local Red Cross or civic group.  The devices themselves cost under $2,000.

Compare that to the financial risk of being sued for not having an AED near a worksite fitness room, and it’s a no-brainer that any company with onsite workout equipment should at least investigate an AED buy and training.

Employees, supervisors and upper-level managers alike will probably need education about SCA and AED use. A great teaching resource is available here.

Key talking points –  Without an AED, 90% of victims die. But if you have access to one, there’s a good chance to save an employee’s life.  And it’s easy to teach supervisors and staff members how to use the device if it’s ever needed.

The vast majority of facilities with AEDs never need to use them ?.” and that includes medical facilities. But it only takes one tragic event, and subsequent lawsuit, to cause pain for both the business and an employee’s family.

Do not forget – Avoidance and education are always your company’s best tools for avoiding liability. In this case, where human life is involved, the choice seems rather obvious.