If you're in the HR field, you probably already know how fluid and transformational employee benefits compliance can be. From changing employee demands to legislation reforms, HR professionals have to constantly be on the look-out for disruptive changes in their work environment.
But how do you keep track of all these changes surrounding employee benefits that are propping up without any warning signs? Here, our employee benefits experts at Pacific Prime will take you through 5 actional tips to help you stay on top of the trend and enhance your employee benefits compliance in the upcoming years.
1. Review your contracts
The first employee benefits compliance issue we'll look at stems from service provider contracts. Employee benefits service providers regularly make subtle changes in their contracts every year. This makes keeping up with contract reviews a crucial task for all HR experts, regardless of which industry you work in.
However, annual contract reviews are a daunting task, and for this reason, many HR professionals roughly skim through their yearly contract updates or entirely delegate the process to their assistants and associates.
Not carefully reviewing service providers' contracts can lead to detrimental financial loss for your business. For instance, slight wording changes in the contract's confidentiality clause can leave your business more vulnerable to external parties. Other aspects of the contract you should be looking through line-by-line include:
- Fees
- Audit rights
- Contract termination rules
- Dispute resolution
2. Are your employees still eligible?
In the past few years, one of the most anticipated trends in the HR field is the major demographic shift within the workforce. In around 5 years, all Baby Boomers that once dominated the workforce will be retired. Today, Baby Boomers are already retiring at a rate of 10,000 a day. Meanwhile, Millennials and Generation Zs are entering the workforce in massive numbers. This can lead to various compliant pitfalls when it comes to employee eligibility.
HR experts need to reassess whether their employees are still eligible to receive the employee benefits offered by the service provider. Eligibility conditions can vary significantly between different benefits plans, so make quarterly plans to review eligibility conditions carefully to make sure both veteran and young employees are still eligible to receive all the benefits provided.
3. Be compliant with notices and reports
Communication between HRs and service providers isn't the only employee benefits compliance issue that HR professionals are responsible for. Many HR experts overlook the importance of delivering notices and reports to all employees. Time and time again, we've seen HR professionals send out one short email to let their employees know of a major change within their benefits plans. This leads to a failure of communication between HRs and employees, causing potential losses to the company, such as:
- Failure to implement a plan change
- Failure to reduce or eliminate benefits
- Lawsuits from employees
- Tax penalties
These problems can be even more severe if there are many expat employees in your company as benefits regulations and laws often apply differently to foreign nationals. This makes effective communication from HR a necessary part of managing expat employees.
Here are a few more tips to make sure you get your message across to all employees when a major plan or regulatory change occurs:
- Schedule your notices in advance so that you won't forget them
- Set up an official meeting to explain any relevant updates to all employees
- Put up notices on your office's notice board or projector
- Talk to department heads to let their teams know about any relevant changes
4. Update employee risk policies
Work-related health issues are fast-changing and employee risk policies will need to stay updated. Such a policy should include any emerging workplace scenarios that may be harmful to employees. A modern employee risk policy will also account for varying risks stemming from different positions and departments within your company. Blanket employee risk policies aren't only unhelpful to your employees, they're boring!
To start updating your employee risk policy, we'd recommend brainstorming potential risks by the following categories:
- Occupational health and safety - eg. environmental and personal injury risks
- Compensation and benefits - eg. the risk of financial abuse
- Employee conduct and supervision - eg. abuse and personal information risks
- Exiting employees - eg. intellectual property risks
After brainstorming, check to see if the current employee risk policy has left out any important points and make the necessary amendments. Finally, make sure you effectively communicate any changes in the employee risk policy to all your employees.
5. Paid leave is still an employee benefits compliance issue
Nowadays, most employers will offer some form of paid leave for their employees, including sick, disability, and parental leave. Large companies will meet the minimum legislative requirement for the number of paid leaves offered to their employees.
However, employee benefits compliance issues relating to paid leave could arise as more countries are starting to expand the number of minimum paid leaves. Here are a few places that could potentially see significant regulatory changes to the number of paid leaves:
- USA: President Donald Trump recently promised to expand child care and time-off options for parents.
- Finland: The Finnish Prime Minister, Sanna Marin, announced plans to introduce a four-day week, and limit working hours each day to 6 hours.
- Hong Kong: Hong Kong is currently reviewing a bill that would expand maternity leave from 10 to 14 weeks.
For this reason, HR professionals will have to stay up to date with any legislative changes to paid leave days in their country to avoid this unnecessary employee benefits compliance issue.
Managing employee benefits and staying compliant
Staying compliant on all employee benefits issues is a difficult thing to do, and unfortunately, most companies simply do not hire enough HR staff to get the job done without any hiccups. The most effective way for employers to manage these compliance issues is with the help of an employee benefits broker like Pacific Prime.
As a global employee benefits and health insurance broker, Pacific Prime has worked with over 3,000 corporate clients over the world to deliver employee benefits solutions, such as international health insurance and wellness programs. If you'd like to find out more, feel free to contact our team of experts or visit our corporate website today!