HRO Today July/August 2016 - 60

The Benefi ts Package
A La Carte
By Craig Dolezal
Offering a total rewards strategy allows employees to select specifi c
benefi ts that accommodate their lifestyle.
Organizations are facing an unprecedented shift in
the makeup of the workforce that is changing the way
employers are thinking about their benefi ts programs. This
has happened before, and organizations have risen to the
challenge. Take, for example, employer-sponsored health
insurance programs were introduced to the market due
to post-WWII wage controls and a need to hire and retain
employees in a growing economy with rewards that went
beyond cash compensation.
In today's market, the cost of benefi ts and rewards are
continuing to go up. As benefi ts fees continue to outpace
wage increases, benefi ts will eat up nearly half of total
compensation spend by 2024. In spite of the increasing
spend, employees don't really see any differentiation in
the rewards their employers provide. In fact, the majority
of respondents to Aon Hewitt's 2016 Workforce Mindset
study said that when they compare their rewards to those
offered by other employers, nothing really stands out.
At the same time, employee expectations around rewards
vary as a result of changing workforce dynamics. For
example, baby boomers, who are beginning to exit the
workforce, seek benefi ts that foster health and wellness,
and place more value on money. On the other hand,
Millennials, who will comprise approximately 75 percent
of the workforce by 2025, place value on creative benefi ts
and meaningful work. In fact, a recent MetLife study
revealed that 80 percent of employees want personalized
benefi ts geared to their individual circumstances and age.
[60]
HRO TODAY MAGAZINE | JULY/AUGUST 2016
These shifts expand expectations around the role
employers should play. For healthcare, employees look to
their organizations to provide ways to help them get and
stay healthy. From a fi nancial perspective, organizations
now need to deliver approaches and tools to help
employees manage their wealth.
Employers are interested in offering more fl exibility in
rewards to better align with this increasingly diverse set
of workforce expectations. They are rethinking their onesize-fi
ts-all benefi ts programs in a broader total rewards
context.
Organizations are rethinking a one-size-fi ts-all benefi ts
program in order to offer more fl exibility and rewards
that are better aligned with this increasingly diverse set
of workforce expectations. In fact, Aon's research shows
that approximately 70 percent of employers believe that
total rewards strategies will be leveraged by organizations
by the end of the decade in order to accommodate the
evolving workforce.
Total rewards marketplaces aim to meet these demands
by offering a variety of different benefi ts and programs
that span across health and wellbeing. This can include
health insurance, 401(k) plans, and tuition reimbursement.
Employees receive a fi xed amount of money as part of
their benefi ts offering and they choose how they want
to allocate their employer's contribution. For example, in
addition to health insurance, a Generation Y worker may
elect a 6 percent contribution to their 401(k) plan, and
HRO Today July/August 2016

Table of Contents for the Digital Edition of HRO Today July/August 2016
