By Mark Olsen, Managing Director at PlanPILOT
With the continued shortage of quality workers to fill emerging available jobs across the growing economy, companies are recognizing that retaining older workers as long as possible has become a greater necessity. In addition, managers and HR directors are realizing significant advantages of this growing employee demographic. Along with their accumulated wisdom and experience, late-career employees are still interested and able to stay employed. They also embrace desirable employee habits, such as a traditional work ethic, a duty of care toward their responsibilities, and steady reliability.
To incentify such individuals to stay, however, it may be worthwhile to revisit your benefits program and look at what upgrades or enhancements might be implemented to accommodate older employees in your workforce. Here are some suggestions.
Address Older Worker Healthcare Needs
It’s no surprise that healthcare benefits would be a primary concern for older workers and measures can be taken to address those needs. Contrary to what might be surmised, older workers are less prone to injury at the workplace than younger workers, but often take longer to recover from injury. Providing greater choice in healthcare options and allowing more time off for healing and physical therapy may be worth investigating.
Having the company provide a higher percentage of health, dental, and vision plan premiums (maybe 100%) may also be advantageous. Depending upon the coverage, older workers may be willing to continue working if their employer healthcare coverage meets their needs, even if they qualify for Medicare benefits. Include coverage for physical and rehabilitative therapy.
To help older (or all) eligible employees with rising healthcare costs, implementing a health savings account program with employer contributions could be a significant benefit with several tax advantages. Employer contributions may be made whether or not a Section 125 plan is implemented.
A Greater Interest in Insurance Coverage
Younger employees in the prime of their lives are generally less concerned about life and disability insurance, but you can be sure your older workers are quite interested in these benefits. Company-provided life and disability insurance are top-of-mind benefits for these individuals. Offering additional coverage at discounted rates may also be added.
Accident and critical illness plans would be attractive too. These insurance programs pay lump-sum benefits to workers who are either in a severe, debilitating accident or suffer prolonged illnesses, such as heart attacks, organ transplants, or cancer.
Encourage Retirement Saving With Matching and Education
Older employees naturally have less time than their younger colleagues to save for retirement. Offer them assistance with higher employer matching contributions and profit-sharing. Provide educational workshops on retirement income planning that explain the long-term benefits of payroll deferrals to retirement accounts and the higher contributions limits for those over age 50. Schedule regular visits to the workplace by investment advisors to the company plan and allow for work-time meetings so older workers can ask questions or receive updates about retirement saving, investing, and financial wellness.
Consider Legal Assistance As a Company Benefit
A lesser known but growing company benefit offered by most Fortune 500 companies is legal services. These programs can be flexible in design for the older demographic in the workplace, providing legal advice on topics specific to them, such as creating a Last Will or other estate planning documents, late-life divorce, or long-term care concerns. Individual attorney fees are expensive and getting to see an attorney outside working hours may be difficult. Arranging for legal consultations would be a welcomed and valuable benefit.
Flex-time and Other Benefits
Having flexibility in their work schedule remains a primary benefit for many older workers. At this point in their lives, maintaining a greater work-life balance is a priority, as well as the ability to schedule and meet healthcare appointments, making time to help with grandchildren care and activities, and attend to other personal or family obligations. According to a 2023 McKinsey & Company report, those 55-64 years of age cited “workplace flexibility” as the third most important reason for leaving a current job.
Providing learning and skill development programs may also be attractive to older workers. An AARP study found that the majority of older workers (especially those among minority populations) were keenly interested in learning new skills and interest increased into the 90th percentiles when employer support was provided. These conclusions help support the value of retaining older workers despite rampant accusations (over 70 percent of respondents) of age discrimination in the workplace—something every company would want to avoid.
Utilizing Professional Assistance
PlanPILOT is uniquely positioned to help employers customize and design benefit plans that meet your unique needs and objectives. If you’re ready to upgrade to a new standard for your benefit planning, reach out to us at (312) 973-4913 or send an email to mark.olsen@PlanPILOT.com to learn more about how we can customize our services and your plan to fit your unique needs.
About Mark
Mark Olsen is the managing director at PlanPILOT, an independent retirement plan consulting firm headquartered in Chicago. PlanPILOT delivers comprehensive retirement plan advisory services to 401(k), 403(b), and 457 plan sponsors. His specialties include plan governance, investment searches, investment monitoring, and plan oversight. Mark is recognized as a leader in the industry and speaks at national conferences, including those organized by Pensions & Investments, and CUPA-HR.