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Financial Planning Insights

COVID-19 Changes to Your Employee Benefits

By The Chandler & Knowles Team | | 0

COVID-19 has affected everyone. We miss our loved ones, many have lost their job, or had a reduction in pay or hours. Parents are making tough choices about schooling options. The demand and price of certain items have us all scratching our heads as to why it is happening. Most of all, the future seems uncertain and we need some advice on where to go next. Small business owners are struggling with predicting the costs as this virus is continuing to surprise us all in its far-reaching effects.

What Considerations Should I Make As a Business Owner?

Although you may be seeing short-term gains in your health plan, this can change down the line. Many of your employees have deferred elective procedures to stay home as much as possible. There are some areas that may need to be addressed including:

  • Adding virtual or telehealth options: Due to the dangers of visiting the doctor, including covid 19 and employee benefitsvirtual experiences may be a wise decision. This also may cut back on employee absenteeism as a phone call or zoom meeting doesn't require the drive to and from the doctor's office, or the wait that accompanies the appointment.
  • Mental health: Consider adding or increasing mental health benefits as you may see more anxiety or depression in the new norms. Employees who confront mental health issues are less likely to get physically sick, show a reduction in job performance, or quit without notice.
  • Adding Employee Assistance Programs or EAP: EAP includes a variety of help with mental health issues, finances, family, and marriage. This could be in the form of webinars, counseling, or advice.
  • Cost-sharing programs: With the health concerns with COVID-19, offering programs to shrink patient responsibilities such as deductibles, co-pays, and co-insurance, may be a viable alternative to increased health premiums.
  • Retirement matching: Some employees may feel it is necessary to lower retirement contributions in order to meet current financial needs. Employers should be aware of the differences you may see in this area.
  • Offering voluntary benefits: An employer may elect to add voluntary benefits such as flexible spending accounts. FSA programs can assist with paying child care, deductibles, co-pays, and non-covered items such as eyeglasses, higher-priced prescriptions, dental work, and more. A voluntary benefit might also be critical illness coverage or hospital indemnity.
  • Allowing employees to draw cash for vacation pay rather than taking the days off to help with unexpected expenses is a great benefit as well.

Communication is Essential to Success

Employees, now more than ever, need to understand their benefits. Employers need to take the time to make this information interesting and engaging. Zoom meetings, webinars, slide presentations, videos, and podcasts are taking the place of boring, in-person boardroom meetings. The last thing you want to do is to implement a benefit and no one uses it because they just don't get it. Also, add in a Q&A session to give everyone the opportunity to ask about areas that seem unclear or confusing. 

Chandler & Knowles CPAs is ready to assist you with decisions about employee benefits for 2021. Now is the time to be planning any changes and budgeting for those costs. Contact us today. 

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Posted in Business Consulting, Employee Benefits, Covid-19

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