The Employee Benefits You Should Demand

BOSTON – You may already work for a company that offers the best employee benefit package out there. You could go work for one of the 10 firms just named by Principal Financial Group as having the best employee benefit packages in the country. Either of those options provide you a great shot at retirement security.

But more likely you are going to have to push your current employer to introduce the benefits that make a company worth working for and that will best pad your nest egg. But what should you push for? What are the benefits that could make the difference between having a so-so retirement and perhaps having a financially secure one?

According to Principal, the benefits deemed most important in contributing to long-term employee financial security include retirement plans, strong medical coverage (including significant premium subsidies by employers), long-term disability options, group life insurance, accidental death and dismemberment coverage, medical and retirement packages for part-time employees, and effective communication methods to help employees maximize the benefit options.

But in this year's contest to find the 10 best employers, the new benefits worth seeking include the following:

1. Wellness

Whether it's immunizations or wellness benefits, the really smart companies are starting to make the connection — there's a return on investment when you introduce or expand the commitment to wellness programs. For instance, wellness programs reduce accidents at work, which improves attendance, and more importantly can contribute to lower health-care costs in general.

And that's a good thing, especially since Towers Perrin noted in a recent survey that health-care costs for employers are projected to rise 6 percent, or $578, to $8,748 per employee in 2007.

In its study, however, Towers Perrin noted that there's a big difference between firms with high health-care costs per employee and those with low costs. Low-cost firms, not surprisingly, are taking steps to actively manage their health programs. For instance, many leading employers are moving away from individual cost-containment "fixes" toward a holistic approach that aims to create a "culture of health."

Yes, many of the low-cost firms, two in every three, have implemented a consumer-driven health plan or will implement one in 2007. But that's not all. The low-cost firms measure the cost of benefits, study health-care-use metrics and make sure employees understand and manage their health risks and conditions.

2. Autopilot retirement savings

More firms are adding and will likely add, especially in the wake of the new Pension Protection Act, autopilot features such as automatic enrollment and automatic deferral increases to their retirement plans. What's more, Principal said nine of the 10 employers with the best benefits program this year offered target-date and target-risk funds among the investment options in their 401(k) plans.

According to the authors of "Aging Gracefully," offering or expanding automatic 401(k) plans with features such as automatic enrollment, automatic escalation, automatic investment and automatic rollovers could go a long way toward improving retirement security in America. "A growing body of evidence suggests that judicious use of default arrangements — arrangements that apply when employees do not make explicit choices on their own — holds substantial promise for expanding retirement savings," the book says.

3. Retirement income security

More companies are looking holistically at all of the income needs individuals will have when they retire, said Nevin Adams, editor-in-chief of PlanSponsor magazine and one of the judges in this year's contest. Indeed, Adams said there is a surprising number of firms in America that still offer a traditional defined-benefit pension plan, that offer generous 401(k)s, strong long-term disability programs and retiree medical.

"It may be hard to believe but there are companies out there that do offer retiree medical," he said.

4. Education and workplace guidance

Nearly all of the companies with the best employee benefit programs offer some kind of one-on-one benefit guidance or financial planning at the worksite or some pay for personal investment advice. To be fair, Adams said it may be difficult for firms with more than 10,000 employees to offer that kind of guidance in the workplace, but it's not impossible for firms where the president knows the names of each and every employee.

So what's the best way to get your firm to introduce these kinds of benefits?

Well, for starters, don't try to convince your HR department. That would be preaching to the choir, says Adams. Instead he recommends sending letters to the so-called C-suite - the senior level executives. "You have to appeal to the people who can make those decisions," he said.

And what should those letters say? In essence, this: all else being equal, the firm with the better benefits gets to attract new employees and retain the really good employees. What's more, the company just might get the extra added benefit of all the publicity that comes with being named as one of just 10 firms with the best employee benefits programs in the nation.