Where to start?: Benefits enrollment basics
If you work in HR, you might know benefits enrollment is defined as a period when employees can enroll in services offered by the company as part of an overall benefits package. An employee will go through initial benefits enrollment after onboarding and benefits will start after meeting any time threshold, like a 90-day introductory period before benefits are active.
Open enrollment is a benefits enrollment period that occurs annually. During open enrollment employees can enroll in new benefits, confirm existing benefits or make changes. If it’s not an open enrollment period, employees cannot participate in benefits enrollment unless they meet one of two conditions. Either they must be a new employee starting benefits for the first time or have a qualifying life change, like marriage or birth of a child.
Companies can reduce confusion during benefits enrollment by having clear communications about benefits enrollment periods and accessible policy information available for employers who need help. Human resource departments should consider employee demographics and benefits usage when creating corporate communications around benefits enrollment. This will allow them to package benefits in a way that meets demands for target groups within the employee base.
When this occurs, employees benefit from clear, simple communication from their company during enrollment periods, and can educate themselves on benefits by doing things like attending educational seminars and reviewing information curated for them.
Related: Onboarding Guide
Four typical employee benefit types
Benefits are at the heart of benefits enrollment. When we talk about ‘benefits’ in a work context we are typically referring to packages that are put together by your company with a selection of services that your employees can opt into as an advantage of working for you. The services are usually discounted or free of cost to employees, with employers taking a share of the cost to offer a pass-through discounted rate.
When companies engage employees in communication about benefits enrollment, they are referring to benefits that fall into four different categories:
- Health benefits: These include medical insurance, dental and vision insurance, pharmacy benefits, healthcare savings and flexible spending accounts and corporate initiatives geared at improving overall health of employees.
- Retirement: Retirement benefits include accounts like 401k, a retirement savings account that offers the option for the employer to pay a share of what goes into the account out of each paycheck.
- Financial security: Short-term and long-term disability that guarantees paid-time-off in the event of an accident or emergency can sometimes be included in enrollments.
- Educational: Some employers offer college benefits like tuition reimbursement programs.
Three considerations about benefits enrollment
Benefits enrollment periods can cause employee challenges, and increase the amount of work that a human resources department has to do. As an HR professional, you should consider these best practices to help your company have a successful enrollment period:
- Make it easier for employees to research plans
- Decide on technology
- Provide adequate time to review materials
Make it easier for employees to research plans
Whether it’s an initial benefits enrollment, open enrollment or a life change, employees should feel empowered to research their options. When employees research the materials prepared by the company, attend benefits seminars and ask important questions to HR managers, they become educated on the best benefits for their situation.
HR departments should ensure communication is simple and clear. They should plan employee education that is designed to enlighten employees about benefits and plans and make themselves accessible for questions. This can be aided with help from human resources platform technology that centralizes the benefits election process.
Decide on technology
Technology is an asset for companies looking to simplify benefit enrollment and communications around benefits. Companies should choose their chosen method of digital communication be it email, PDF files, video or other correspondence that helps train employees on benefits election.
Employers can also invest in technology that automates basic HR tasks, like sending out reminders about open enrollment. Using workflow automated technology can help HR professionals focus on the needs of employees during an open enrollment period.
Provide adequate time to review materials
After you’ve decided the best way to communicate information to employees, and the best technology to assist with this communication, it’s time to give employees enough time to review the materials. In addition to benefits materials, there are likely important legal disclosures that employees also need time to review and ask questions about.
Diligent human resource departments give employees adequate time to review all materials provided throughout the enrollment process. HR departments can benefit from time management and project management software designed to track deadlines and goals as they approach an open enrollment period.
FAQs: benefits enrollment
These are some frequently asked questions about benefits enrollment that HR professionals should be prepared to answer:
What is open enrollment with regard to benefits?
Open enrollment is a period that occurs every year in the United States, where employees are asked if they would like to change their benefits or opt in to additional benefits. If you do not make changes to your existing benefits package during the open enrollment period, you need to have a qualifying life event to make changes, or wait until the next year’s enrollment period.
If I have benefits, already do I need to do anything during benefits enrollment periods?
If you have existing benefits, you do not have to update them during open enrollment period. However, if you’d like to make changes to existing benefits than you will need to use the open enrollment period to make those changes, unless a qualifying life event, like a marriage or birth of a child, occurs.
How can you tell if life insurance coverage is adequate?
You should carry between six and 10 times your annual salary in life insurance.