Making the Business Case for Employee Well-Being

Brief

Making the Business Case for Employee Well-Being

Abstract

Businesses are beginning to move beyond traditional health insurance and retirement plans to improve employee well-being in multiple domains. The programs they offer are typically voluntary and can include financial well-being, paying for educational expenses, and on-site resource navigators who help employees address a wide range of issues. These innovative well-being benefits have the potential to make employees more engaged, less likely to miss work and make mistakes, and more inclined to protect their employers from waste or fraud. Some business case studies show that businesses with happy, healthy, and stable employees can be more profitable than their competitors.

In an ideal world, businesses would have information to rigorously assess how investments they make in their workers improve both employee outcomes and business objectives. But research demonstrating the business case for investments in innovative well-being benefits is still nascent. Businesses and policymakers need more and better data and deeper analysis to inform their decisions. And many of the innovative third-party benefit providers and human resources professionals are not well prepared to answer their important questions.

This brief uses insights from human resources and business literature, existing social science research, and original interviews conducted with seven human resources professionals at large companies. We interviewed human resources directors, benefits managers, and talent acquisitions specialists in the food service, retail, health care, banking, airline, and sports industries. These interviews were designed to understand the challenges to and the opportunities for building and strengthening the evidence for innovative benefits that enhance employee well-being.

We begin by describing the business-related pain points employers seek to address. We discuss next the emerging landscape of innovative well-being benefits, the changing mind-sets that accompany them, and the opportunities they present. We outline the four key employer questions about the value of innovative well-being benefits and the ways that businesses typically answer them. We then illustrate how benefit providers in partnership with businesses could build a stronger business case and evidence base.

Larger Vision for Building Evidence in the Public Sphere

One of the largest challenges in making the business case for employee well-being is how to bring lessons learned into the public domain and how to increase the quality of the research and analysis so they’re more useful for businesses and policymakers.

A few challenges impede this goal: businesses and benefit providers may be reluctant to share with competitors what they see as their competitive advantage, businesses and benefit providers are risk averse and do not want any data coming out that present potential legal challenges or risk to their reputations, and the public may suspect bias when businesses and benefit providers release their own data.

These barriers might be overcome in several ways:

  • Creating a research collaborative around employee well-being and business value: Under ideal conditions, a research collaborative could bring together business consultant experts in human resources, social science researchers, third-party benefit providers, and businesses. A collaborative could protect the reputation of the businesses and providers as well as the privacy of individual employees’ personal information, and it would provide the analytic and research capacity needed to move toward more rigorous evaluation and experimentation.
  • Pooling and deidentifying data: Particularly for voluntary well-being benefits with notoriously low take up rates, much of the power of analyses comes from pooling individual-level data, whether that be across establishments within a business, across occupations in a sector, or across businesses using a particular type of model.
  • Testing generalized benefit models or packages of benefits: Rather than evaluating a single benefit provider’s program or benefit, researchers can evaluate a generalized model in different dosages, durations, or other variations.
  • Testing bigger-picture relationships between well-being and business value: Another valuable way to analyze these data is to test the relationship between employee well-being and business value.

People’s places of employment are an important and uniquely accessible platform for making a difference in their lives. By collaborating with third-party benefit providers, businesses have incredible potential to support their employees and meet their strategic goals by providing the types of innovative well-being benefits discussed in this brief. We need to understand more about these intersecting realities to better support businesses in this important work.

Cross-Center Initiative

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