Information is all in the retrieval. A whole library at your disposal will not help if you cannot find the one volume you need. For managers, nowhere is the problem of retrieval more daunting than in employee records. When a worker of 34 years comes in to ask about his payroll deductions, typically, the manager sighs, hefts out a two-inch file, and begins thumbing through a morass of papers.
“It costs more than time,” says Dave Koch, CEO of Two River Benefits in Ocean. “This confused record keeping can lose very real money and open employers to substantial liabilities.” For this reason, many of Koch’s clients are switching to an online benefits package which organizes that unwieldy file into a slim disk, available to both the manager and employee, 24/7.
* Benefits and Beyond. An online benefits package lays out each employee’s entire history with the company on a customized website, made available by a commercial provider. The site is fully secure and encrypted, and may be handled by an intermediary, typically an insurance broker. The company owner and perhaps select HR executives have overall access. Each employee, via his username and password can view all his own personal data, (and no one else’s.)
While the broker can, if desired, handle the data input, Koch finds that most all clients want to handle this aspect themselves. “The site is so simple, the forms done so quickly, that people prefer to retain the in-house control,” he says.
This consolidation of records initiates with basic benefits listing, and then expands to provide much more. The site shows each employee his particular benefits, and insurance. Various tabs, e.g. Medical, Dental, Life, Disability, provide links to insurance forms, explanations of plans and benefits, customer services, and even carriers’ websites. It further details in readable form retirement packages, vacation plans, perks, and bonuses given by the company. Every payroll deduction may be listed and categorized. * The Greatest Savings. Definitely the most impressive benefit of an online package comes right at the set up. Instead of HR people slaving over reams of forms, each employee fills out his own online. No more chasing down that traveling sales rep, trying to get details out of him. He fills out the forms online, selects the healthcare package and dental options from the company plan. If he wants life insurance, he chooses the plan, fills out the form, and selects the deduction. He chooses his own type of payroll deduction for retirement.
“The employee can sit at home and discuss it with his family,” says Koch. “Errors are rare because the program questions them. But if they slip by, the company cannot be blamed, or held liable.” In the process of filling out the various forms, the employee is required to read certain statements and sign that he has read and understands them. Thus, if at a later date, the employee violates some company regulation, e.g. does something repeatedly that might be deemed as harassment, he cannot use ignorance as a defense. The manager can always flip open the offender’s online record and point to exactly where he claims to have read and understood the harassment rules.
Such an online signing-on process provides a great way of making sure employees read the handbook. It minimizes the company’s liability with proof that the employee has been warned. Getting employees to fill out their data online is typically not a problem since they like the idea of seeing all the choices. “Besides,” notes Koch, “one can always make the next paycheck contingent on getting all the data recorded and submitted.”
* Employee Extras. Yet the strongest motivation for filling out all the particulars is that the employee realizes he is making a cooperative record. Every employee has a website called “My Benefit Count.” This spells out all the payroll deductions, gives all the benefit-related answers. The more information the worker puts in, the more details he can get out. Everything can be logged in: vacation times, bonuses earned and bonuses promised, even perks like a gym membership paid by the company. This allows the employee to track what’s due him.
Beyond the work record, other financial planning tools are available. “Our online program automatically links me to a site which helps me figure how much I must set aside in my 401K to retire in style by age 65,” says Koch. “I just hope it doesn’t add up to more than I’m making.” A similar sideline is the establishing of tax free education accounts with necessary IRS forms provided.
As identity theft grows ever more rampant, so does the time spent reestablishing credit, determining true versus fraudulent expenditures, making new applications, etc. A good online benefits program will come equipped with an anti-identity theft program which will legally guide victims through the steps and even make necessary notifications.
* Employer Extras. A recent widow walks into the human resource manager’s office and asks to see her late husband’s company life insurance policy. The HR manager scans the file and replies that her husband never took out such a policy. “Oh, I know he did. He told me he did. Can you prove to me he did not?” responds the irate widow. At this point the HR manager squirms, trying to envision the upcoming visit from her lawyer. “With an online benefits file,” says Koch, “the manager could politely show the widow the exact box which her late husband had checked saying he did not want any life insurance. Boom. No lawyer, no legal liability. In fact, the form would have demanded that the husband make a choice, not just leave it blank, or the record would not have been accepted.
Such legal protection makes a fine backup, but the program’s real daily value comes from the full and complete financial history provided on each employee. Does a particular employee with a $55,000 annual salary cost the company $85,000? A formula figuring out all the total benefits can rapidly itemize the cost to the penny. By the same method, each remuneration, in whatever form, is logged and compared with the company’s accepted pay scale.
For companies with employees working throughout several states, the program can keep managers abreast of all state and federal statues for family and medical leave acts and and similar regulations. “All this minutiae which might slip through the cracks is brought to the HR person’s attention,” says Koch.
It is interesting that one of the last aspects of business to get organized and take full advantage of the cyber revolution is businesses’ greatest asset - its people. Money, inventory, clients, suppliers have all been categorized and cross-indexed for decades. But it is only now that we are getting around to those people who run the show and make it all work. Hopefully, with programs like the online benefits systems, employees and managers can join in a more participatory effort, and gain a fuller picture of just how valuable they really are. B4
Dave Koch has spent the last two decades as a broker, scouring the fine print of insurance plans, trying to save his clients money. Growing up in Philadelphia, Koch attended that city’s Temple University, earning a bachelor’s in marketing in l983. At the urgings of his brother, he took his first position in insurance with Confederated Life Insurance soon after graduation. For several years he served as the manager of Cigna’s special risk operation in New Jersey, which handled over $4 million of New Jersey TDB disability premium. Ten years ago he launched Two River Benefits, specializing in insurance mostly for small and mid-size firms.
