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Adapting your employee perks strategy for a hybrid work environment

Health and Benefits|Talent|Wellbeing

By Shannon Bailey and Shankar Raman | November 12, 2021

Amid a competitive environment to attract and retain key talent, it is essential that employers revise their perks strategy to support the changing work environment.

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About the series

Explore how employers can harness the power of employee perks to elevate their benefits program as they prepare for a post-pandemic future.

As COVID-19 changes how and where employees work, 80% of employers are planning to expand or enhance employee perks, which will result in the need to develop a perks strategy that supports a distributed workforce.

Graph showing breakdown of how many employers expanded/enhanced any perks offered.
Action taken, 45%, planning action for 2021, 19%, considering action for 2022, 16% and neither planning nor considering action, 20%. Employers that reduced or suspended any perks offered. Action taken, 18%, planning action for 2021, 5%, considering action for 2022, 4% and neither planning nor considering action, 72%.
Figure 1. Most employers expanded or are looking to expand their perks strategy because of COVID-19

Source: 2021 U.S. Perks Study. Note: Percentages may not add up to 100% due to rounding

Employee perks in a hybrid work environment

Shannon Bailey and Shankar Raman discuss how the changing work environment is impacting employee perks.

Our 2021 Flexible Work and Rewards Survey found that both employers and employees anticipate that close to 50% of employees expect to work in the office less than five days a week for the foreseeable future. As a result, we believe the office will become a place where employees will likely convene to collaborate, innovate, learn, celebrate and strengthen connections and will play a lesser role in supporting an employee’s need to do individual work.

Most organizations should plan for a future in which they likely will have at least the following combinations of employee groups:

  • Remote: A group that is mostly working from home or remotely, i.e., workers who primarily will come into the office or workplace on special occasions for defined or planned events such as workshops, key meetings or team building
  • Onsite: A group that always goes to the office or the workplace for various reasons, including personal choice or the nature of the work they perform
  • Hybrid: A group that regularly will split work time between home and the office or workplace

Amid a competitive environment to attract and retain key talent, it is essential that employers approach revising their perks strategy in a thoughtful manner that noticeably enhances the employee experience for all three groups.

Spotlight on perks stipends

An innovative way to differentiate and address diverse employee needs is through a lifestyle spending account (LSA) or a perks stipend. As the delivery of traditional perks and onsite conveniences have changed because of the pandemic, an LSA offers flexible funds that employers can provide to employees to pay for various perks. Furthermore, they support an equitable perks strategy across multiple work environments and could potentially simplify a perks strategy.

With an LSA, the employer decides what is eligible for reimbursement, who is eligible to use it and the amounts that are offered. Additionally, employers can customize how the funds are used. For example, an employer could use an LSA to address an identified benefit gap or a need within a certain business, or simply to provide a broad range of additional perks.

Furthermore, LSAs are not tax-advantaged accounts, so they are not regulated with strict rules like other benefit accounts. There are no maximum or minimum allowable amounts. Employers fund only what employees spend as the accounts are not pre-funded and there’s no cash outlay if the funds aren’t used.

By offering LSAs, employers can demonstrate their commitment to employees by providing meaningful value without the administrative time and costs of multiple programs and vendors. According to our 2021 U.S. Perks Study, employers currently offer various stipends and accounts to support wellbeing, home office set-up, continuing education, student loan repayment, childcare allowance and financial planning. An LSA could replace these existing programs or supplement them.

An LSA may be an ideal solution to help deliver meaningful support to your employees.

Below is an example of the LSA’s eligible expense flexibility that can be designed to meet varying needs in a personalized way.

Key actions for employers

  1. 01

    Develop the strategy

    In order to develop a work strategy for a dispersed workforce, employers should evaluate their employee populations and demographic data to determine the enhanced suite of offerings that will meet the needs of employees and their families, regardless of work location. Consider the following:

    • Determine if there is opportunity to address employee needs globally.
    • Solicit feedback from employees to understand their needs and what they value in a workplace.
    • Identify the gaps to meet those needs and what will be helpful to attract or retain and to differentiate.
    • Define the guiding principles to ensure the offering and design aligns with and compliments the employer’s benefit objectives.
    • Determine the appropriate subsidization level for an LSA that provides meaningful choice while balancing budget targets.
  2. 02

    Identify the administrator

    The LSA vendor landscape is vast and rapidly evolving with a range of capabilities and the sophistication of their solutions. Consider the following:

    • Identify which capabilities are the best fit for the organization, supports flexibility to meet employee needs and provides the administration to make it easy to use.
    • Ensure the vendor partner selected can meet the objectives of the employer’s program and fits your employee experience strategy.
  3. 03

    Determine the timing

    LSAs can be deployed quickly any time of year and outside of annual enrollment. Announce the rollout of an LSA to align with your perks strategy — whether that’s to balance a takeaway or to highlight an LSA on its own.

    Whether you’re refreshing your perks strategy or preparing for a hybrid work environment, this is a critical time to pause and be thoughtful about the needs of the changing workforce in order to better support employees. An LSA may be an ideal solution to help deliver meaningful support to your employees.


Senior Director, Health and Benefits

Senior Director, Human Capital and Benefits

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