With the recession putting workforces under strain, health and wellbeing benefits pay their way by keeping staff fit, says Debbie Lovewell
When the going gets tough, people cope in different ways. As the recession tightens its grip, many may be tempted to reach for a glass of wine or a bar of chocolate as a little treat after a tough day or to help them cope with hard times. That may sound innocuous enough - and is, if enjoyed in moderation - but employers should keep an eye on staff to spot any signs of struggle. High stress levels and over-indulgence, particularly in alcohol, or drug misuse as a coping mechanism, can have a significant impact on employees' health, which will impact on their concentration, productivity and performance.
When times are tight, it can be difficult to justify the cost of health and wellbeing perks for staff. But there are a number of advantages for employers in supporting staff and helping them stay in top condition, both mentally and physically. Helen Vaughn-Jones, acting senior manager, policy and research at Bupa, says: "Employers that invest in supporting their workforce in a recession can reap rewards. It sends staff a powerful message that the organisation values them, and makes good business sense because employees who are healthy and well are likely to be more productive."
Identifying where employees are suffering from mental health issues, such as stress, can be more difficult than spotting physical ailments. But doing so is particularly pertinent during a recession because of the increased pressure some staff are likely to face. The fear of redundancy, increased workloads and financial concerns are among the issues putting staff under greater pressure. Jessica Colling, product director at Vielife, says: "If employers have made people redundant, they have a workforce that is expected to do more, so looking after their health and wellbeing is essential. If they are expecting people to do more with less, they need to invest in their health and wellbeing."
According to the Employee Benefits/Simplyhealth Healthcare Research 2009, 88% of respondents that had a stress management strategy in place said they were prompted to implement it in response to the recession.
Counselling service†
An employee assistance programme (EAP) or other form of counselling service is one way employers can offer staff support. As well as addressing work-related issues, EAPs can also provide advice on debt management, relationship problems and, in some cases, legal issues. Eugene Farrell, business manager at Axa Icas, says: "The outcome from debt-related issues and the economic situation is increased pressure on employees, both at work and at home. For example, if their partner is facing redundancy, it is often going to affect the employee's psychological health. We are going to see an increase in absence due to pressure."
Catching potential problems early, for example through an EAP or health screening service, can help to prevent absence or at least reduce the time staff are away from work.
If employees do go off sick, it is in the employer's interest to help them return to work as soon as possible, particularly if the workforce has been reduced by redundancies. A number of perks can be used to rehabilitate staff and help them return to work as quickly as possible (see Group risk supplement, published with this issue, page 13) Employers have traditionally used private medical insurance (PMI) to help staff gain faster access to private treatment and so return to work in the shortest possible time. But, perhaps not surprisingly, the high cost of providing this perk and rising premiums have prompted some employers to look for ways to make their scheme more cost-effective.
Fierce competition†
One option is to rebroke cover to source cheaper provision of both PMI and benefits such as group income protection and critical illness cover. Fierce competition in the marketplace means now is a good time to do so, with many providers offering competitive pricing or added-value deals. Andrew Grigg, strategic health director at Jelf Wellbeing, says: "If employers find they have the benefits in place but need to offer the same for less, there are a number of insurers offering very competitive deals at the moment."
Alternatively, employers could provide a core level of PMI through a flexible benefits scheme and enable staff to top this up at their own cost, if they wish.
Another option is to move staff into a hybrid PMI/cash plan product. In this type of scheme, half the monthly premium goes towards running the plan, and the rest is paid into the policyholder's personal deposit account, which builds up and can be used to cover the cost of treatment when required.
Healthcare cash plans are also proving their worth in the recession because of their relatively low cost. They provide cash lump-sum payments to help staff fund everyday treatments, such as physiotherapy, dental and optical care. Premiums start at less than £1 a week per employee.
Employers could also benefit from the old adage 'prevention is better than cure'. Encouraging staff to make small changes to improve their own wellbeing can make a big difference to their mental and physical health. Health and wellbeing events can help to raise awareness of the changes employees can make and why these are important.
In the long term, improved employee wellbeing can also reduce claims on medical benefits. "There are a lot of things employers can do that cost very little, from encouraging employees to walk during their lunch break, to providing free fruit, to changing the options available in vending machines," says Vielife's Colling. "If employers can look at how to keep people healthy, they can look at how they can keep claims costs down in the long term."
Other low-cost options include web-based wellbeing portals, which give advice and information on common health issues, and discounted membership to local gyms.
Such initiatives can also help to tackle employee stress issues, which can be exacerbated by a poor diet, lack of exercise and poor-quality sleep, for example.
However, it can be difficult to prove the return on investment in wellbeing perks. Factors that can be measured include employee productivity, engagement and absence levels, as well as any reduction in claims on perks such as PMI, which can help to reduce future premium levels.
Although many firms may not be in a position to spend on new benefits, Elliott Hurst, a senior consultant in healthcare and risk consulting at Watson Wyatt, says employers that want to make radical changes are now in a strong position to do so because of keen competition among providers in some areas, as well as lower employee expectations. "If employers are seeking to make some fairly radical benefits changes, now is possibly the time as they hold the upper hand in terms of compensation," he says. "When the upturn comes, employers will need to have a well-recognised package to help recruit staff."†
Case study: Renault in health drive†
Renault continues to invest in a holistic approach to employee health and wellbeing during the recession.
It offers a wide range of perks, such as an employee assistance programme, provided by Validium, and dental insurance offered through the firm's flexible benefits scheme, which are aimed at supporting employees' mental and physical wellbeing. The tough economic conditions have not deterred it from offering these. Marina Polyakova, HR business manager, explains: "It is possible to save on costs, but it does not have to be at the expense of health and wellbeing." One way Renault has done this is by consolidating its private medical insurance (PMI) plan, which resulted in savings. "The question was not shall we continue to offer PMI, but what do we need to do to continue to offer it?" says Polyakova.
The company is also still introducing new perks, such as a two-week long health and wellbeing event. "We wanted to do something positive in the current climate," she adds.
How the recession will affect respondents' provision of healthcare benefits
