A Flexible Benefit Plan

Flexible Benefit projects generally succeed where the communication of the new plan is effective and the technical delivery of the new benefit structure runs smoothly.  Without getting both right, the value of the new arrangement will be unfulfilled. Of the two, communication with staff is often not given the right amount of attention and is the most likely cause for the plan being less than successful.  A simple communication plan with staff consultation, background notes and access to good information is the way to keep employees involved and engaged and to avoid some of the more negative views that might creep in.

It is important to use a plan to make sure the key elements happen at the right time.  Each stage should deliver an output that will allow you to move to the next stage.  A typical project plan might cover the following areas.

Stage 1 – Feasibility

This is really important and should be used to achieve a number of objectives, including acceptance of the potential costs and resource issues.  It is also the time to make sure any assumptions are checked and problems resolved.  This stage should include an assessment of benefits and consider employee attitudes and perceptions. Is a flexible plan even appropriate at this stage, or would a stepping stone like the provision of total reward statements be more appropriate.

If you are considering using an IT system to run the plan, you should assess your IT environment, including PC availability, software availability (e.g. browsers, electronic document readers) intranet use and Internet access.  Equally important is to look at the source of employee data and make sure the impact on payroll processing is clearly thought through and documented.

Timescales are fundamentally important and these need to be addressed.

Finally, administration issues need to be addressed.  You will need to consider how benefits are currently administered and what will change when the new plan is introduced.  For example, you will need to look at your current processes for handling new entrants, leavers and other events that effect benefits (maternity leave, promotion, etc.) and investigate how you currently interface with benefits providers and advisers.

Outcome of Stage 1

For the feasibility stage, the outcome should be a documented summary of the key changes that your organisation intends to implement that can be discussed and debated internally by the decision makers.  It is also sensible to give employees some idea of the key changes being considered. 

Stage 2 – Planning and Specification

The specification will formally set out the details of the new arrangement, including the benefit offering and the implementation plan.

The specification should include a section with details of a structured programme of communication from “sign off” until launch date aimed at raising interest and awareness.  This might include flyers to employees, group presentations and individual employee meetings.  The importance of getting this part right must not be underestimated.  A communication plan might include a telephone help line service, internal help desk or launch workshop to include product providers and systems demonstrations.

It is also important to include training for internal staff or existing third-party administrators so that all parties are fully conversant with the new plan.

Outcome of Stage 2

A full project plan specifying the details of the benefit changes, the timescales and process changes.  A communications plan should also be included.

Stage 3 – Implementation

Once the specification has been approved, the next stage is implementation.  This should be carried out in accordance with the specification document.  In our view, there are two key factors in a successful implementation. 

• People – the team at the organisation need to be committed to the new plan or it will not work.
• Time – things cannot be rushed.  The specification will have a note of key dates but it is easy to let things slip and be too rushed at the end. 

Outcome of Stage 3

The end of the implementation stage should result in employees enrolling for their new benefits and these benefits going live once the enrolment period has finished.  Following that, the employee data will need to be checked and delivered to payroll and benefit providers, according to the specification document.  There are bound to be employee queries and manual adjustments that need to take place, so make sure time is set aside after the “going live” date.

Stage 4 – Administration, Support and Maintenance

Once installed and operational, a benefits system will produce much of the basic information required in order to run the plan.  Whatever others might say, technology rarely represents a panacea for the range of problems that a complex communication and administration process presents.  The reality is that processes are human and technology offers tools that allow part or all of these processes to be automated.  Successful technology needs to be incorporated into processes to succeed.

You can choose to administer the plan in house or outsource to a third party, such as Atkinson Bolton Consulting Ltd.  The cost of outsourcing is easy to identify and this can then be compared to the cost of using internal resources.

An IT solution will come with technical support and solutions like Real Benefits™ can be accessed across the internet.  Real Benefits™ is designed to ensure few technical installation issues (as they use an internet browser) and good access for employees and administrators.

As well as the monthly administration, the plan should be monitored and reviewed using employee feedback and details of the benefit take up rates.  From time to time, benefits need to be refreshed, removing unpopular benefits and replacing them with alternatives.

An example of administration tasks include:

• Submission of monthly membership data between your plan and the benefit providers
• Submission of monthly data to your payroll provider.
• Submission of year-end summary data for “benefit-in-kind” calculation purposes.
• Processing of new entrants and leavers
• Processing of lifestyle events – employees who change their benefit selection on marriage, birth of a child, etc.
• Processing of claims (retirement, illness, incapacity, death)
• Processing of employee detail changes (address, names)