Re-Opening the Economy and Your Employee Benefits
Restrictions and public health directives related to the COVID-19 pandemic have been very challenging for small business owners across Canada. As some parts of the country begin to re-open, many small businesses are trying to figure out what the future will look like. For some small businesses, the effects of the closures and restrictions mean they are now operating in “survival mode.” There are more challenges ahead as the economy re-opens. As a small business owner, you’re making a lot of changes, and you may wonder if you should make changes to your employee benefits program as well.
Opening up shop after an unplanned closure or change can be a real challenge. As a small business owner, when you reopen you may be faced with:
- Fewer or more sporadic customers – because customers are fearful of going out, or due to restrictions that limit the number of customers allowed at one time;
- Supply chain challenges – your suppliers are likely dealing with their own challenges which may affect you; worse yet, they may not be re-opening;
- Lower productivity – physical distancing requirements may make it more difficult for employees to work together to complete their jobs.
Why sponsor employee benefits?
There were several good reasons why you chose to sponsor employee benefits in the first place. Let’s remember them and evaluate whether they’re still valid.
- Attract and retain talent. Employees are your biggest asset and finding and keeping the right ones makes all the difference. As the economy re-opens you may be faced with a new challenge: some employees may be reluctant to return to work. They may be feeling fear for their health and safety. They may be receiving government relief money while staying at home and prefer to continue to stay home and receive it. Either way, employee benefits can be an incentive to return to work. Attracting new talent continues to be important as well; a fresh perspective on how to operate in this “new normal” may be invaluable. Using employee benefits as a means to attract and retain talent is still a valuable tool.
- Support good health. As your greatest resource, supporting your employees in achieving and maintaining good physical and mental health is an important goal. Not only is it the right thing to do, but it also helps increase productivity, lower absences and contain costs. Sponsoring employee benefits to support good health is just as important now as it was before the pandemic.
- Tax-deductible business expense. At a time like this, there’s no question that a tax-deductible expense is better than a business expense that you can’t write off!
Evaluating your employee benefits
If your business has been financially impacted by the pandemic, you may be looking to cut costs wherever you can. If you’re considering making drastic changes to your employee benefits plan, take some time to look at your long-term strategy. Terminating or drastically reducing employee benefits might save you money in the short term, but in the long term, it may be detrimental to your business. Start by evaluating your plan.
First, ensure that your plan has cost-containment measures in place. Here are just a few of the ways that GroupHEALTH helps business owners control costs:
- Smart Rx Solutions. These are prescription drug plans that help control costs through generic substitution, the use of a central dispensing pharmacy, and the drug “formularies”. All of these plans help you support your employees with prescription drug coverage while containing your costs.
- Disability Management Services. Disability management services help ill or injured employees get back to work as soon as they are able. This is a good thing for employees because research shows that the longer they are away from work, the less likely they are to ever return to work. It’s a good thing for you (the employer) because it helps lower disability claim costs and assists you with the administration of the claim.
- Employee and Family Assistance Program (EFAP). An employee and family assistance program provides free, short term counselling for employees. This type of service helps employees work through mental and emotional issues so they can focus on their work. It can help reduce absences and disability claims. This type of service is especially valuable during a stressful time (like the COVID-19 pandemic).
Next, make sure your plan is easy to change or easy to set up, so you can adapt it as needed in the future. It may indeed be the right time to make some changes to your plan, but first, talk to a knowledgeable employee benefits advisor to help you explore all options. Concentrate on making thoughtful, strategic changes that can help your company emerge from a very challenging time.
Good Advice is Key.
While it’s good news that there is talk of re-opening the economy in Canada, you and your company may be facing some significant challenges. For help navigating challenges associated with your employee benefit plan or changes that must be made, be sure to talk to an expert. Review your options with one of our licensed advisors on the phone, or contact us for a comparison quote.