More than one-third of companies have increased outsourcing of benefits functions in the past two years according to the International Foundation’s Corporate Benefits Departments: Staffing and Operations: 2015 Survey Results. This finding, on the surface, may rattle your sense of job security. But a closer look shows that most benefits departments are growing and staff members are devoting time gained by outsourcing some functions with more strategic initiatives. Additionally, many are optimistic about the future of careers in corporate benefits departments.
Key findings of the study include:
- The average responding company has 5.3 total benefits staff—three professional/managerial staff and 2.3 support/clerical staff. The average number of benefits workers ranges from 2.9 in companies with fewer than 1,000 employees all the way up to 11.3 in companies with more than 10,000 employees. In the past two years, more companies have increased the size of their benefits staff than have decreased.
- More than one-third of companies have created a new benefits staff position or title in the past two years, and more than seven in ten respondents are optimistic about the future of benefits careers. More than one-third of companies have benefits staff dedicated primarily to wellness programs, and more than one-quarter have benefits staff dedicated primarily to benefits communication.
- On average, responding companies outsource roughly two-fifths of all their benefits functions, and more than one-third of companies have increased outsourcing in the past two years. The top reason companies outsource benefits functions is for expertise. Other less-common reasons for outsourcing include technology, costs and risk.
- Some of the most common fully outsourced benefit services include the administration of employee assistance programs (EAPs), flexible spending accounts (FSAs) and Consolidated Omnibus Budget Reconciliation Act (COBRA). On the other hand, a majority of companies handle annual enrollment, Family and Medical Leave Act (FMLA)/leave administration and benefits communication and education fully in-house.
Benefits Department Structure
- Three in five responding companies have an employee benefits department separate from human resources or other departments. More than four in five companies say their benefits functions report to their human resources department. In nearly one-quarter of companies, benefits functions are just one reporting position removed from the chief executive officer (CEO) and about one in ten companies has benefits functions reporting directly to the CEO.
- Half of responding companies have budgets specifically for benefits staff education, and one in five has education policies for benefits staff. Nearly two in five companies have increased the time and resources spent on benefits staff education in the past two years.
Other Trends and Challenges
- About two-thirds of companies say they promote their employee benefits in their recruiting/retention efforts. However, more than one in five companies promote their benefits only in the job interview/hiring process, and more than one in ten do not promote their benefits at all.
- More than three in five companies have increased the use of data in their benefits departments during the past two years.
The top two challenges facing benefits departments by a wide margin are compliance with benefits laws and regulations and rising health care costs.
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Corporate Benefits Departments: Staffing and Operations: 2015 Survey Results uncovers the responsibilities and staffing practices of benefits departments, education and training for benefits staff, outsourcing of benefits functions and
challenges facing benefits departments. Completed responses were received from 343 individuals representing U.S. corporations of a variety of sizes, regions and industries in the databases of the International Foundation and the International Society of Certified Employee Benefit Specialists (ISCEBS).
Senior Research Analyst at the International Foundation