Area com­pa­nies trim back ben­e­fits, shift more of the bur­den to work­ers.

The Washington Post Sunday - - BUSINESS - BY AARON GREGG aaron.gregg@wash­post.com

Com­pa­nies in the Washington area are al­lo­cat­ing smaller por­tions of their bud­gets to­ward em­ployee ben­e­fits and are more likely to spon­sor less-ex­pen­sive perks such as well­ness pro­grams, tu­ition re­im­burse­ment and ma­ter­nity leave, ac­cord­ing to new re­search.

Asurvey of 160 lo­cal com­pa­nies by the Hu­man Re­sources As­so­ci­a­tion of the Na­tional Cap­i­tal Area found that lo­cal com­pa­nies plan to spend just 26.3 per­cent of their pay­roll bud­get on em­ployee ben­e­fits in 2015, the low­est por­tion since the or­ga­ni­za­tion be­gan con­duct­ing the sur­vey in 2006. In less than a decade, this per­cent­age has dropped by al­most six per­cent­age points.

The de­cline comes as tra­di­tional ben­e­fits such as pen­sions and health in­sur­ance plans — which tend to be more costly for em­ploy­ers and harder to phase out with­out draw­ing work­ers’ ire — are fad­ing across the coun­try in fa­vor of less costly pro­grams.

Lo­cal em­ploy­ers kept the amount they al­lo­cate to­ward “health care and wel­fare” costs steady at 10.4 per­cent this year by shift­ing more of the bur­den to em­ploy­ees, in­clud­ing rais­ing the de­ductible they pay for a visit to the doc­tor, ac­cord­ing to the data.

Twenty-eight per­cent of com­pa­nies sur­veyed said they are ask­ing em­ploy­ees to shoul­der more of the cost of health in­sur­ance. One quar­ter of com­pa­nies said they are rais­ing de­ductibles, up from 22 per­cent last year and 20 per­cent in 2013.

They are also al­lo­cat­ing less to re­tire­ment ben­e­fits — 7.3 per­cent in 2015, com­pared with 7.8 per­cent last year.

Mean­while, lo­cal com­pa­nies are fill­ing the gap with less ex­pen­sive, piece­meal of­fer­ings such as more gen­er­ous ma­ter­nity leave poli­cies and tu­ition aid, ac­cord­ing to the study.

“Clearly em­ploy­ers are not adding the tra­di­tional ben­e­fits,” said Lenny San­i­cola, who spe­cial­izes in em­ployee ben­e­fits at World at-Work, a hu­man re­sources as­so­ci­a­tion. “What they’re do­ing in­stead is look­ing at more of the non­tra­di­tional ben­e­fits; ‘ how to make a less stress­ful work en­vi­ron­ment, how do I en­hance your pro­fes­sional de­vel­op­ment.’ ”

In 2015, 36 per­cent of em­ploy­ers of­fered a well­ness pro­gram, up from 23 per­cent in 2007. Thir­tysix per­cent of com­pa­nies of­fered paid pa­ter­nity leave in 2015, com­pared with 27 per­cent two years ago. Tu­ition re­im­burse­ment is also more com­mon — 91 per­cent of com­pa­nies are of­fer­ing it in 2015, up from 83 per­cent in 2008.

More com­pa­nies, 84 per­cent, al­low telecom­mut­ing. This is down slightly from last year.

“Telecom­mut­ing is a triple-win for an em­ployer,” said Alan Chvotkin, ex­ec­u­tive vice pres­i­dent and coun­sel at the Pro­fes­sional Ser­vices Coun­cil, a trade as­so­ci­a­tion for busi­nesses that con­tract with the gov­ern­ment.

“It’s an in­duce­ment and ben­e­fit to the em­ployee who doesn’t have to en­dure a com­mute. And it’s a win for the com­pany be­cause they might get more pro­duc­tiv­ity [by cut­ting the com­mute], and they can re­duce the size of their real es­tate foot­print.”

These types of ben­e­fits are of­ten cheaper to pro­vide, and em­ploy­ees do not get as at­tached to them, work­place ex­perts said.

“If you took a well­ness pro­gram away, who would care? If you took away their health in­sur­ance, you’d hear much more of an out­cry,” said Joan Passerino, a mem­ber of HRA-NCA’s sur­vey com­mit­tee who also serves on the D.C. Re­tire­ment Board.

It is also a re­flec­tion of a chang­ing work­force. Job-hop­ping, postre­ces­sion mil­len­ni­als might have dif­fer­ent ideas about what they want in a job.

“Years ago, when you went into an in­ter­view it was re­ally about ‘ how much are you go­ing to pay me, what does the health plan look like, and how much paid time off do I get,’ ” San­i­cola said.

“Now the con­ver­sa­tion is much more com­plex: ‘Do you ex­pect me to be on e-mail 24/7? Will you pay for my pro­fes­sional de­vel­op­ment? Is this the kind of work en­vi­ron­ment I would en­joy?’ ”

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