Distributing the SPD for your Section 125 Plan – It’s not just about compliance
It’s no secret that the task of government compliance with programs such as IRS Section 125 Plans has most employers jumping through some hoops. There Department of Labor lists one of many requirements to distribute certain documents such as a Summary Plan Description referred to as SPD. But through all of this disclosure and required notifications is a HUGE opportunity to use this communication tool to craft your company culture.
Create a Culture of Communication
U.S. employers spend a tremendous amount of time, emotion and dollars to create and manage their employee benefit plans; yet dedicate only 20-30 minutes per year to communicate these decisions and details to employees. Regulations is time intensive, but rather than view the required distribution of the SPD as a function of compliance, embrace the opportunity to showcase the amazing tax benefits these plans afford to your employees. Take a few minutes to distribute and explain the purpose of the plan and the awesome benefits you and your staff make available to them. Take credit for the careful steps you take as an employer to create tax benefits and security for your most valuable asset- define your corporate culture.
Importance of Communication
The 2011 MetLife Employee Benefits Survey states one in three employees plan to be employed by a different employer twelve months from now. The survey further states that employees have a significantly higher job satisfaction level when they feel benefits are clearly communicated. Compliance is very important and certainly a key driver to communicate but its not all about compliance, take every opportunity to communicate your vision and create your culture.
There is a saying that every entity has a culture. You can either define the culture you want to create, or do nothing and your culture will be created for you. Yes, there are federal and state laws governing these plans that require employee notifications but through years of experience we find the best companies with the highest employee morale aren’t always the ones who spend the most or have superior benefits to their competitors. The most satisfied and loyal employees are those that feel respected and have open and honest communication with management. So stand up and take a bow, let your employees know you care and deliver the message with a positive message.