Are We Becoming Helicopter Employers?

They're called "helicopter parents" for the way they hover over everything their self-indulged Gen Y or Millennial kids do. Give one a bad grade or a bad performance review and watch out! You'll get a quick 'why has this happened?' call from parents who function more as Facebook friends than authority figures.

The problem is that this helicopter mentality appears to be spreading beyond the coddling of those aged 13 to 28 to the way we make workplace benefit decisions.

No one discounts the vital role company benefits play in attracting and retaining talent. Yet in our quest to offer better and more diverse benefits, have we made the same mistake as Millennial parents? Instead of teaching our employees that life is not risk-free, have we programmed them to expect us to function as protectors against all uncertainty?

Especially in dire economic times, businesses serve their employees best by letting them keep more of their own money than taking it for more and more benefits. It's real money employees can use to pay the monthly power bill, boost retirement savings or pay for college.

Unfortunately, there are still too many employees who buy every benefit offered instead of making cost/benefit decisions and benefit managers who pile on the benefits because "everyone else does."

Along with medical, life (if you have dependents who rely on your income) and disability insurance and flexible spending accounts — core, needed benefits — many employers also offer dependent life insurance for children, legal insurance, cancer insurance, pet insurance, long-term care insurance and more. These non-essential benefits can boost the benefits price tag so much that they cause a real decline in wages by outpacing yearly salary increases.

The outcome will be far different if we instead step back and design a benefits program that truly meets our employees’ needs, including a realistic assessment of risk. Take two examples: life and long-term care insurance. Single employees with no dependents really don't need life insurance since the product is designed to replace income. Insuring children is equally unnecessary because no parent depends on their child's income and the risk of a child dying is low.

The same goes for long-term care. Unless you're in your 50s or 60s, you probably shouldn't even consider it. The average person is in long-term care about four years. Those with considerable assets can self-insure; those with little money can qualify for Medicaid in a short time.

While people generally buy the coverage when they are younger — when rates are lower and they are still insurable — the truth is you can still continue to buy the coverage later in life as long as you are reasonably healthy and have no problems handling the daily activities of life.

Want to help your company make wiser decisions about the benefits you offer? Here's a few tips:

• Examine plan enrollment: Find out which plans are most popular with whom and why. Is it senior management or hourly workers thinking they can insure against all of life's risks?
  
  
• Eliminate non-essential benefits: Preserve the core but eliminate benefits such as legal services. Wills can be completed online for far less money and you can save for the legal costs of mortgage closing the same way you save for a down payment.
  
  
• Listen and teach: One of the greatest satisfactions our Benefit Advocates get is from helping people learn enough to themselves choose what's best, such as seniors who realize how it can be cheaper to pay for dental care out-of-pocket instead of through insurance.

In this me-first era, it's easy to give in and try to give everyone everything they want instead of what they really need. Especially today, we can no longer afford that approach. So let’s encourage employees to begin banking the money they used to spend on unneeded benefits. Then if they ever need a lawyer, a veterinarian or get cancer, they’ll have the money to fall back on.

We can't insure away life's unexpected twists and turns. But we can help employees realize that they really can meet life's challenges themselves. We'll never get runaway benefit costs under control until we turn off the rotors.