Growing competition among employers to attract and retain highly technical and professional talent is driving local executives to improve their employee benefits as they face uncertainties over the potential effects of healthcare reform.
Companies of all sizes are finding ways to be more innovative in their benefits offerings, including new investment tools.
Lake Forest-based Lighthouse Escrow Inc., for instance, recently set up a corporate 529 plan, a savings instrument that allows investors to set aside funds for college costs tax-free.
“It works a whole lot like a 401(k), but it’s just targeted to education,” Chief Operations Officer Dustin Steeve said. “As a small business, we often can’t provide the packages that the massive corporations can.”
Savings Plan
Lighthouse partnered with Irvine-based wealth-management firm Sun Group Wealth Partners to start the program. Sun Group Founding Partner Winnie Sun recently launched a national campaign to urge employers to add the savings plan to their benefits packages.
Three out of Lighthouse’s six-person staff have begun paperwork to join the program, Steeve said.
“This wasn’t a decision just about the current team,” he said. “We’re a growing, tech-oriented company, and we tend to attract younger talent. We thought it would be good to have this on our benefits package and make us stand out from some of our competitors.”
Lighthouse and Sun Group, along with others in Orange County, aren’t alone in beefing up benefits packages or at least considering doing so, according to a recent survey conducted by Robert Half International Inc., one of the largest staffing-services firms nationwide.
Robert Half asked some 2,100 chief financial officers from companies across the country which strategies they’re adopting to attract talent. About 46% said they’re improving benefits.
“We are seeing the job market getting more and more competitive,” said Cyndi Karapogosian, a Robert Half senior regional vice president who is based at its Irvine office. “We see candidates getting multiple job offers. Even just six months ago, a great candidate could be on the market for several weeks. Now we’re seeing two to five days.”
Irvine-based Western Digital Corp. recently rolled out a mobile application that its employees can use on their handheld devices and laptops to access their biometric screening data.
It intends to align the app with its wellness benefits and to reflect the innovation at the core of the tech company’s culture, said Jackie DeMaria, senior vice president and head of global human resources.
“We wanted to make sure we personalize our benefit plans for our employees so they have their data accessible to them when they need it,” she said.
Western Digita is in its third year of offering a high-deductible, consumer-driven health plan, which allows employees to use health savings accounts to pay for health costs from pretax salary. The company initiated the shift from traditional health plans when its management saw that many employees were healthy and paying money into a plan they weren’t utilizing.
“The change wasn’t popular at first … and it was tough,” but it enables employees to grow their own savings accounts and to keep their money, DeMaria said.
Western Digital puts money into the employees’ accounts every year to offset the relatively high deductible. Otherwise, the company incurs no additional costs over what it paid into traditional health plans, DeMaria said.
City National Bank started a program this month that reimburses its employees up to $5,000 in adoption-related expenses, the latest addition to a roster of company-sponsored benefits that includes profit sharing.
“Benefits is a pretty broad topic, and we try to take a real holistic look,” said Marianne Lamutt, head of the bank’s human resources department. The bank is based in Los Angeles and has an office in Irvine, with a number of branches in OC. It employs 110 here, out of its 3,600 companywide staff.
“Top talent usually has to be wooed,” Lamutt said. “You have to put together some compelling packages.”
Retention is as important as attraction, said Dayna Parker, head of human resources at Experian PLC.
The Ireland-based data analytics company has its North American headquarters in Costa Mesa, where it employs about 1,400 people.
“We spend a lot of time working on engagement activities to ensure the people we have today stay with us,” Parker said.
For instance, Experian last week launched a site on the company’s network that allows employees to explore the different jobs and responsibilities in other divisions at the company. It’s designed to be a first stop for employees who might be looking to change careers, Parker said.
Some Caution Remains
To be sure, not every employer is rushing to boost its benefits programs in the current market, with hesitancies stemming from the Affordable Care Act.
“It’s an ever-changing environment; the ACA has changed many times over with some of the details,” said Mark Conway, managing director overseeing the Benefits West unit at Alliant Insurance Services Inc.
The Newport Beach-based firm is one of the largest insurance brokers in the country, with revenue last year totaling nearly $504 million.
“We work with a broad array of clients … mainly with the larger companies in Orange County,” Conway said. “I think more of them are trying to understand how the ACA is going to affect them, [asking questions such as] what additional fees they’re going to have to pay now and how they can offset that without cutting benefits.”
Conway said there are certainly examples of companies that are growing and able to contribute more, but it also depends on the sector.
“I’m not saying they’re all cutting benefits costs,” Conway said. “Costs have been going up every year, and the fact that you offer benefits at all means you are investing more. I just don’t see a huge trend of companies adding on to that already increasing number. Most employers are taking a wait-and-see attitude.”
