1. SHRM Survey Findings: Employee Benefits in California—Communicating Benefits April 23, 2014

2. This is part six of a series of SHRM survey findings examining employee benefits in the workplace of California organizations. The following topics are included in the six-part series titled Employee Benefits in California:  Part 1: Wellness initiatives  Part 2: Flexible work arrangements  Part 3: Health care  Part 4: Leveraging benefits to retain employees  Part 5: Leveraging benefits to recruit employees  Part 6: Communicating benefits Employee Benefits in California—Communicating Benefits ©SHRM 20142 Introduction

3. How knowledgeable are employees about their employer-sponsored benefits? The majority (80%) of California organizations reported their employees were “very knowledgeable” or “somewhat knowledgeable” of the employer- sponsored benefits available to them. Are organizations effective in informing employees about their benefits? Roughly three-fourths (79%) of organizations “strongly agree” or “somewhat agree” with the statement, “My organization’s employee benefits communications efforts are very effective in informing employees about their benefits.” However, only about one-fifth (22%) of organizations had an employee benefits communications budget in fiscal year 2012. What are the top employee benefits communications methods organizations use? The top three communications methods used by organizations in California are online or paper enrollment materials (83%), group employee benefits communications with an organizational representative (64%) and one-to-one employee benefits counseling with an organizational representative (50%). Are organizations using social media as a platform in their employee benefits communications efforts? Very few organizations use social media in their communication efforts. Overall, 2% of California organizations reported using social media. Among organizations not using social media in their employee benefits communications efforts, 8% of organizations indicated they plan to start using social media within the next 12 months (both in California and nationally). Employee Benefits in California—Communicating Benefits ©SHRM 20143 Key Findings California

4. In this post-recession period of slow salary growth, some employers and HR professionals are using comprehensive benefits packages as a means to attract and retain talent. Consequently, clear communication about benefits has become important. Most HR professionals think their benefits communications are effective, but less than one in four (22% in California, 24% nationally) had an actual benefits communications budget. HR professionals have likely spent much time navigating the ins and outs of the Patient Protection and Affordable Care Act (PPACA). Given the complexity of the law, HR professionals should pay particular attention to health care-related benefits communications for the foreseeable future. Although some employers may choose to opt out of coverage and pay a penalty, some experts have argued that decision will have a negative impact on recruitment and retention. HR professionals appear to be aware of this. More than four in five respondents (81% in California and nationally) said health care is the most important benefit to the majority of their employees. Most organizations in California and nationally are not using social media channels for benefits-related communications. However, that may change in the future, perhaps due to employers’ increased use of social media in other aspects of business operations, as well as workers’ increased comfort with those forms of technology. Employee Benefits in California—Communicating Benefits ©SHRM 20144 What do these findings mean for the HR profession?

5. Focus and Knowledge of Benefits Employee Benefits in California—Communicating Benefits ©SHRM 20145

6. Overall, how knowledgeable are your employees about the employer-sponsored benefits available to them? Employee Benefits in California—Communicating Benefits ©SHRM 20146 Note: Respondents who answered “not sure” were excluded from this analysis. Percentages may not equal 100% due to rounding.

7. How does your organization determine the knowledge level of employees about the employer-sponsored benefits available to them? Employee Benefits in California—Communicating Benefits ©SHRM 20147 Note: Percentages do not equal 100% due to multiple response options. An asterisk (*) indicates that this response option was developed from open-ended responses.

8. Which benefit from your organization’s benefits package is the one most important to the majority (more than half) of employees? Employee Benefits in California—Communicating Benefits ©SHRM 20148 Note: Respondents who answered “not sure” were excluded from this analysis. Percentages may not equal 100% due to rounding. California (n = 355) Overall (n = 423) Health care81% Flexible working benefits5%4% Retirement savings and planning4%5% Leave benefits3% Family-friendly benefits3% Preventive health and wellness3%2% Professional and career development benefits2%1% Housing and relocation benefits0% Other1%

9. In three to five years, which benefit from your organization’s benefits package do you think will be the one most important to your employees? Employee Benefits in California—Communicating Benefits ©SHRM 20149 Note: Respondents who answered “not sure” were excluded from this analysis. Percentages may not equal 100% due to rounding. California (n = 355) Overall (n = 418) Health care65%67% Retirement savings and planning10%11% Family-friendly benefits7%6% Flexible working benefits6%7% Preventive health and wellness5%6% Professional and career development benefits5%1% Housing and relocation benefits1%0% Leave benefits<1%1% Other<1%0%

10. Communicating Benefits Employee Benefits in California—Communicating Benefits ©SHRM 201410

11. How strongly do you agree or disagree with this statement, “My organization’s employee benefits communications efforts are very effective in informing employees about their benefits.” Employee Benefits in California—Communicating Benefits ©SHRM 201411 Note: Respondents who answered “not sure” were excluded from this analysis.

12. Did your organization have an employee benefits communications budget in fiscal year 2012? Employee Benefits in California—Communicating Benefits ©SHRM 201412 Note: Respondents who answered “not sure” were excluded from this analysis.

13. Did your organization’s fiscal year 2013 employee benefits communications budget increase, remain the same or decrease when compared with the fiscal year 2012 employee benefits communications budget? Employee Benefits in California—Communicating Benefits ©SHRM 201413 Note: Only respondents whose organizations had an employee benefits communication budget in fiscal year 2012 were asked this question.

14. Within the last 12 months, did your organization make any changes to your employee benefits communication materials? Employee Benefits in California—Communicating Benefits ©SHRM 201414 Note: Respondents who answered “not sure” were excluded from this analysis.

15. Which of the following employee benefits communications methods does your organization use? Employee Benefits in California—Communicating Benefits ©SHRM 201415 Note: Respondents who answered “not sure” were excluded from this analysis. Percentages do not total 100% due to multiple response options. California (n = 361) Overall (n = 431) Enrollment materials (online or paper)83%82% Group employee benefits communications with an organizational representative 64%62% One-to-one employee benefits counseling with an organizational representative 50%55% Intranet44%46% Direct mail to home/residence32%33% Newsletters (online or paper)30%34% Benefit fairs27%24% Virtual education18%14% Social media2%3% Other9%

16. Within the next 12 months, does your organization plan to using social media as an employee benefits communications tool? Employee Benefits in California—Communicating Benefits ©SHRM 201416 Note: Only organizations that currently do not use social media as an employee benefits communications method were asked this question. Percentages may not total 100% due to rounding.

17. Demographics Employee Benefits in California—Communicating Benefits ©SHRM 201417

18. Employee Benefits in California—Communicating Benefits ©SHRM 201418 Demographics: Organization Staff Size n = 310

19. Employee Benefits in California—Communicating Benefits ©SHRM 201419 Demographics: Organization Sector Note: n = 322. Percentages do not equal 100% due to rounding.

20. Percentage Professional, scientific and technical services24% Health care and social assistance13% Manufacturing12% Finance and insurance10% Government agencies8% Educational services8% Transportation and warehousing7% Retail trade7% Whole trade6% Real estate and rental and leasing5% Accommodation and food services4% Administrative and support and waste management and remediation services4% Construction4% Information4% Utilities4% Religious, grantmaking, civic, professional and similar organizations3% Mining2% Arts, entertainment and recreation2% Repair and maintenance2% Agriculture, forestry, fishing and hunting2% Personal and laundry services1% Other9% 20Employee Benefits in California—Communicating Benefits ©SHRM 2014 Demographics: Organization Industry Note: n = 328. Percentages do not equal 100% due to multiple response options.

21. Employee Benefits in California—Communicating Benefits ©SHRM 201421 Demographics: Other U.S.-based operations only79% Multinational operations21% Single-unit organization: An organization in which the location and the organization are one and the same. 30% Multi-unit organization: An organization that has more than one location. 70% Multi-unit headquarters determines HR policies and practices. 59% Each work location determines HR policies and practices. 5% A combination of both the work location and the multi-unit headquarters determines HR policies and practices. 37% Is your organization a single-unit organization or a multi-unit organization? For multi-unit organizations, are HR policies and practices determined by the multi-unit headquarters, by each work location or by both? Does your organization have U.S.-based operations (business units) only, or does it operate multinationally? n = 324 n = 325 Note: n = 234. Percentages do not equal 100% due to rounding. Corporate (company-wide)78% Business unit/division15% Facility/location16% Note: n = 234. Percentages do not equal 100% due to rounding. What is the HR department/function for which you responded throughout this survey?

22. SHRM Survey Findings: Employee Benefits in California—Wellness Initiatives Response rate = 13% 373 HR professional respondents in California organizations from a randomly selected sample of SHRM’s membership participated in this survey Margin of error +/- 5% Survey fielded May 3 - June 7, 2013 Survey Methodology Employee Benefits in California—Communicating Benefits ©SHRM 201422

23. Benefits Communication Resource Page Open Enrollment Resource Page Managing Medical Leave in California Communicating with Employees About Health Care Benefits Under the Affordable Care Act Communicating with Employees About Health Care Benefits Under the Affordable Care Act Employee Benefits in California—Communicating Benefits ©SHRM 201423 Additional SHRM Resources

24. About SHRM Research 24 For more survey/poll findings, visit www.shrm.org/surveyswww.shrm.org/surveys For more information about SHRM’s Customized Research Services, visit www.shrm.org/customizedresearchwww.shrm.org/customizedresearch Follow us on Twitter @SHRM_Research@SHRM_Research Project leaders: Christina Lee, researcher, SHRM Research Yan Dong, SHRM Research Project contributors: Alexander Alonso, Ph.D., SPHR, vice president, SHRM Research Evren Esen, director, Survey Research Center, SHRM Research Copy editor: Katya Scanlan, SHRM Knowledge Center Employee Benefits in California—Communicating Benefits ©SHRM 2014

25. About SHRM Founded in 1948, the Society for Human Resource Management (SHRM) is the world’s largest HR membership organization devoted to human resource management. Representing more than 275,000 members in over 160 countries, the Society is the leading provider of resources to serve the needs of HR professionals and advance the professional practice of human resource management. SHRM has more than 575 affiliated chapters within the United States and subsidiary offices in China, India and United Arab Emirates. Visit us at shrm.org.shrm.org 25Employee Benefits in California—Communicating Benefits ©SHRM 2014