1: Frequent Communication
First and foremost, make sure you are communicating effectively with your employees, even with those who have been laid off or furloughed due to COVID-19.
If you are still in contact with those who no longer work for you, remind them of the resources they have to cover expenses as we move into 2021 - especially as many CARES Act benefits come to an end.
Remember that in these difficult times, it’s better to communicate more than you usually would so that your employees feel as little stress as possible. Offer reminders about your employees’ retirement plan options, including contribution limits, matching contributions and the potential to tap into their 401(k) if necessary to cover certain expenses.
2: Health Insurance Plans
It’s likely the pandemic has affected your business and your employees - whether you’ve shifted to working remotely, were forced to furlough or had to close your doors for weeks at a time. Unlike years before, you’re at a tough crossroads as we head into the new year. Should you (and can you afford) to offer health insurance to your employees for the new year?
If you’re offering automatic re-enrollment to employees, now is the time to review and update your offerings if needed - especially if you’re looking to offer more suitable coverage to help those affected by the pandemic.
3. Reevaluate Your Wellness Plan
Wellness programs are great ways to improve the health and productivity of your employees. By helping your employees to improve their health, this can ultimately improve the overall cost of employer-provided health care.
These programs can benefit employers by:
- Lowering health care costs
- Reducing absences at work
- Achieving higher productivity from your employees
- Reducing workers' compensation and disability costs
- Reducing injuries
- Improving the overall employee morale
If you don’t have one yet, determine if there’s room in your business’s budget to begin offering one to employees. Develop goals and objectives and work towards those plans to make your program a reality at work.
4. Optimizing Your Retirement Plans
Plan sponsors have the opportunity to evaluate how parts of their retirement plan design can improve the financial well-being of employees and how much income they can expect to receive in retirement.
Important steps to evaluating this are:
- Understanding the plan health
- Learning more about the default investment options
- Figuring out investment offerings
- Learning more about education and communications programs so you can see what you should be offering
When it comes to retirement plans, some additional tips to keep in mind are:
- Understand what your plans do and do not cover
- Continuously communicate with your plan provider
- Make sure you are maintaining your plan and keeping up with the responsibilities
- Rules are always changing, so stay on top of any changes that are being made
What If You Have to Suspend Your Plans?
With the coronavirus pandemic, some companies have suspended employer matching contributions. Doing this can be a strong short-term fix for any cash flow issues that your company is facing during this time, but before doing this, review your plans and figure out what your best options are.
If your company has discretionary, non-elective matching contributions, those can likely be suspended immediately without amending plan documents. Make sure your company has a communication strategy in place to let employees know.
Figuring out what to do for not only your business but also your employees is incredibly important. It’s crucial that you are finding plans that work best for you and your employees. While it’s always been a huge part and incentive of jobs, as we have been navigating the uncertain times of 2020, it’s more important than ever to prepare for 2021 as a responsible plan sponsor.
If you find yourself wondering if your company's 401(k) plan offering stacks up to all of today's best in class features and benefits, click HERE to learn more and to download our free guide "4 Keys to a Successful 401(k) Offering for your Employees"