Employee benefits packages are a powerful driver of retention, but only when employees truly understand and use them. Today, confusion around benefits is widespread, contributing to declining satisfaction and unrealized ROI. Effective benefits education closes this gap by reinforcing value, boosting engagement, and strengthening employee retention, with key education strategies including:
Employee benefits are supposed to be one of the strongest levers employers have for attracting and keeping talent. Yet for many organizations, employee benefits packages fall short of their potential for a simple reason: employees do not fully understand what they are being offered, how those benefits work, or how to use them effectively.
“Benefits is a really tricky animal,” Lauren Winans, CEO and principal HR consultant at Next Level Benefits, said at the SHRM25 conference in San Diego. “It’s really complicated; it’s got a lot of buzzwords, a lot of vernacular that isn’t used regularly. Employees don’t like benefits because they can’t understand them.”
“The benefits process is incredibly confusing,” agrees Amy Mosher, chief people officer at Charlotte, N.C.-based software firm isolved, explaining to SHRM why employee satisfaction has fallen. “There are very few employees out there who feel confident in their understanding of their benefits.”
Only 61% of employees say they are satisfied with their benefits, representing a decline from 66% the year prior. For the remaining two out of five workers, how much of their dissatisfaction is due to a gap in understanding their benefits and how valuable they are?
Certainly, employees who are satisfied with their benefits show it. Research from MetLife has found these workers are 1.5x more engaged, loyal, and productive.
The takeaway is clear. “If employees don’t appreciate or use the programs provided, the intended return on investment is lost,” says Jill Havely, head of global community excellence, employee experience, at WTW. But how can your organization educate its workforce around your benefit offerings in a way sure to boost loyalty and performance?
Many employers invest heavily in benefits education during open enrollment, only to go quiet for the rest of the year. That gap results in reduced understanding and missed opportunities for engagement. Effective benefits education (like most employee training protocols) requires repetition, reinforcement, and regular feedback loops.
Winans recommends surveying employees throughout the year, not only to gauge satisfaction, but to assess awareness. “Let’s say you roll out a new benefit during open enrollment,” she says. “Maybe once the new plan year starts, put out a survey and ask employees, ‘Hey, we rolled out this new benefit during open enrollment. Have you used it yet? Have you had a chance to check it out?’ Sometimes that’s going to be the first time someone finds out about that benefit. A lot of times, you have to tell people the same thing over and over again.”
Asking whether employees have used or even noticed a newly introduced benefit can surface surprising insights. But even more importantly, that follow-up survey months may be the first time an employee truly learns a benefit exists or what it means for them.
Email remains the most common benefits communication tool, but it should not be the only one. Research shows employers use an average of 4.4 communication methods, including in-person meetings, text messaging, printed materials mailed to employees’ homes, and digital portals.
Multi-channel communication recognizes a simple reality: employees absorb information differently and sometimes need information to be presented in different contexts to fully absorb it. Some prefer short texts. Others need face-to-face explanations. Many want spouses or family members involved in benefits decisions, which can make home mailers an effective medium.
A multi-channel approach strengthens benefits education and reinforces the value of employee benefits packages across different life stages, learning styles, and personal preferences.
Many employers, especially small to midsize ones, turn to outside partners for help with benefits communication, and for good reason. Benefits are complex, regulated, and time-consuming to explain well.
However, there is a critical gap between intention and execution. While more than 70% of employers rely on vendors or partners to supply benefits communications, only a quarter say those partners fully execute the communication strategy. This disconnect can leave HR teams and business owners with generic materials that fail to resonate, or with not enough educational material at all.
For employers evaluating partners, communication capability should be part of the due diligence process. Look for a commitment to education and communication at any group with whom you work. “Make it a criteria as part of the selection process,” advises Michael Woodhead, chief commercial officer at FinFit. “If they’re not going to be a thought leader in that area, you may need to find a different partner.”
Complex jargon undermines understanding. Remember Winans’ comments at the SHRM25 conference: too many educational materials rely on too much jargon and arcane language. “Employers should speak as conversationally as possible when talking with employees about their benefits,” says Dan De Oliveira, Senior Director of Benefits Design at Quest Diagnostics. “Speak in a way that will resonate with your audience. Don’t use technical benefits terms or industry jargon.”
Simplification increases utilization, strengthens confidence, and enhances the perceived value of employee benefits packages. In turn, that clarity supports stronger employee retention strategies by reinforcing trust.
Employees often think they understand their benefits more than they actually do. Many surveys will find that majorities of employees report they understand their benefit offerings. But then, only 43% of workers (fewer than half!) even know how to enroll in benefit plans, much less how their benefit plans work or what they entail.
So, don’t use employee self-reporting as an indicator of whether additional benefits education is needed. A little too much educational effort is better than not enough.
“Think like a marketer,” says Kirk McConnell, product marketing lead at Collective Health. In other words, benefits education dovetails with internally “selling” your employes on the quality and value of your benefit offers. If you want your team to appreciate their benefits, tell them what’s great about those benefits.
Once again, getting outside help can empower these efforts. “Many brokers and consultants offer communications support,” McConnell adds. As discussed above, however, just make sure these groups genuinely deliver on their communication promises.
In fact, for small and mid-sized businesses, delivering year-round benefits education can stretch internal HR resources thin, so outside help can be invaluable in this area. This is where a PEO becomes a strategic partner, not just a benefits administrator.
Beyond managing compliance and enrollment, a PEO can help design (or outright provide) communication strategies, provide access to benefits experts, support one-on-one consultations, and ensure education efforts evolve as employee needs change. By integrating education into broader employee retention strategies, PEOs help employers maximize the return on their benefits investment while strengthening employee trust and loyalty.
Benefits education helps employees understand, appreciate, and actually use their employee benefits packages. When employees see real value in their benefits, they are more likely to feel supported and stay with the organization, strengthening overall employee retention strategies.
Open enrollment is a crucial period for benefits education. It also tends to be rife with common mistakes, including inadequate communication and education. But even though open enrollment is important, benefits education should continue year-round. Regular communication reinforces understanding and supports long-term employee retention strategies.
Communication is central to benefits education. Using multiple channels and plain language helps employees understand their employee benefits packages and feel confident using them.
A PEO provides structure, expertise, and ongoing support for benefits education. By aligning education efforts with broader employee retention strategies, PEOs help employers maximize the impact of their benefits investment. For more information, read our guide to how to transform your benefits strategy with a PEO partner.
Ready to rethink your benefits education? CoAdvantage, one of the nation’s largest Professional Employer Organizations (PEOs), helps small to mid-sized companies with everything from payroll to benefits administration. To learn more about our benefits programs and benefits education, contact us today.
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