The Changing Role of the Employer in the New Normal
January 5, 2021
Our modern government has never had to respond to a pandemic before. Prior to 2020, even before the pandemic started, our country was the most divided it has ever been in terms of public policy. On one hand, government needs to play a bigger role; on the other hand, government needs to be contained. That tension has been a good thing throughout our history as a democracy. However, over the course of years, instead of recognizing the benefits of the divide, both sides have focused on vilifying the other to the point where there can be no civil public (or private) discourse.
From out of the chaos, a new slogan was born: “we’re in this together.” A more accurate, but less optimistic, statement would be “we are in this apart.” Apart on how to respond and at least six feet apart physically. But the interesting thing is that the government didn’t create this slogan, it arose from businesses. What we have seen is that businesses are filling the void, keeping us together, becoming our lifeline. It is businesses that are rising to the occasion, finding new ways to adapt. Restaurants focused on carry-out and delivery, office work shifted to home, and businesses were the first to start requiring masks for their workers. It is the American employer that provides for us, not only to have meaningful work, but to put food on our tables. It is to the American employer where we need to pin our hope.
As we have moved through this process, employers have also recognized how important their workers are. We now have another new term, “the essential worker;” those people on the front lines in this new war. Many essential workers are the lowest paid, but now we see how critical they are to a functioning society, worthy of highest respect. They have gotten up every day, willing or not, to put their lives on the line, while others stayed at home.
Which brings us to the one thing we can accurately predict. Whether you have had to stay at home, or go out and fight the invisible enemy, there is a collective consciousness of fear, anxiety and apprehension, which will have lasting effects. The uncertainty brought by lawmakers debating daily will have lasting effects. Where will Americans turn in this new normal? Who can we turn to in order to relieve the anxiety? Who can we trust? It all goes back to the American employer. That’s where the rubber meets the road.
The new normal will herald a shift once again in the paradigm between the employer and the employee. The interdependence of the two has become exceedingly apparent. The attitude of both the employer and the employee will change from “every man for himself” to “we are all in this together” as we climb back up. Yes, you must stop the bleeding first and get your business back on track, but after mere survival you will have a bigger role to play in a post-pandemic world.
The most successful employers will be the ones that recognize the interdependence between them and their employees. They will be their employees first line of defense in an uncertain world.
What WILL be expected? What CAN employers do? What SHOULD employers do? First, they should be honest. In many companies, there is a disconnect between how much an employer says they care and their actions. They tout this altruistic “care” for their customers in their marketing, while in subtle and not so subtle ways, they are telling their employees that they don’t matter. It is time for businesses to connect the dots. You need to live what you preach, not just to the public, but behind closed doors. Never is this more important than with low-wage and essential workers. You have a moral responsibility to look out for the health and welfare of these vulnerable employees as best you can. They need to feel a sense of security and a sense that we are indeed “all in this together.”
There is a show, we all know by now, called “Undercover Boss.” Who do you think made this show so popular? Was it the employers around the country? No, it was the average worker. There is a sense of satisfaction when the “boss” understands your struggles, not just with work, but with life. There is an “aha” moment in these episodes, when the boss gets it. This is not to undermine the boss at all as they have a different set of struggles. They are the ones upon whose shoulders the whole organization rests. In fact, it would be a good idea for employees to experience the level of stress that comes with making daily decisions when the life of the organization hangs in the balance. Companies succeed when they are transparent and everyone is motivated to do their part. That is the point. No one is “not important.”
Secondly, this unprecedented pandemic has caused fear of the worst happening. Not only could the employee become sick, they could be wiped out financially. The average low-wage worker is typically one paycheck away from financial ruin. There are no savings to fix the car that breaks down or cover the expenses of an unexpected illness. Many, many employers recognize these realities. They must make tough decisions on wages and insurance because of slim profit margins. Frankly, there are others that are ONLY looking at the bottom line. While they do not like government interference, they do not accept their responsibility to take care of the health and welfare of their employees. For these employers, if the government won’t do it, then who will? It’s hit or miss. Let charitable organizations take care of it? Let the churches figure it out? That is not the right answer. If you don’t want government interference, then you need to do your part.
Much to everyone’s surprise, businesses have not been wiped out when minimum wage requirements have been raised. Equally surprising, businesses were not wiped out by the Employee Mandate of the Affordable Care Act (ACA). We will now circle back around to what employers can do in the “new normal”.
If you employ over 50 workers, you have no choice but to insure them. The number of insured Americans has gone up by twenty-eight million since the ACA was implemented. But statistics don’t show the considerable gap that exists before low-wage workers can take advantage of any benefits. The average deductibles and co-pays amount to $6,000. That is $5,000 dollars more than the average American has in savings.
It’s a glitch in the system. With noble intent, the government removed limits on pre-existing conditions and caps on coverage. But the math did not work, it could not work under these mandates. The only thing insurance companies could do was raise the deductibles, leaving a hole in the system big enough to drive a truck through. Now, low-wage workers need help with their medical expenses more than ever. Every day they get that constant, relentless reminder of how vulnerable they are. It is the employer that they will look to when some kind of normalcy returns.
But what options are available to help employees? It is blatantly obvious that most cannot afford to close the gap with an ACA “Gold” plan for all, but there are ways to help. Employers have the economic buying power that their employees do not. They can bring that buying power to the table to provide insurance policies that close the gap and that their employees can afford. These insurance policies, known as “gap” insurance, are not subject to the ACA mandates. They can have limits on coverage. As employees in the post-pandemic world look to their employers for security, this is probably the most cost-effective way to provide health insurance. In fact, it makes absolutely no sense NOT to provide it.
These Limited Fixed Indemnity plans can be combined with ACA coverage to cover 95% of a low-wage workers yearly out-of-pocket medical expenses AND major health events. They are affordable for employees without an employer subsidy and are even better if you, as the employer, can chip in. With the right provider and their administrative platform, you can provide a seamless experience for your employees that works just like your ACA plan with payroll deductions, an insurance card that covers the expense directly, and does not require the employee to get reimbursed.
In the new normal, healthcare will be top of mind for employees. Sure, you can provide lunch in the conference room on Fridays, or an unexpected half day off; those are great stress relievers and show you care, but won’t be enough. A happy, healthy workforce is essential. Properly insuring your employees will not only keep them physically healthy, but will give them peace of mind. That is something you cannot put a price tag on.
Written by: J. Marshall Dye III, the founder, President and CEO of Insurance Applications Group, a technology-forward benefits design and marketing firm creating health insurance products for specific industries and employee groups. For more insights and helpful information, visit the IAG Benefits Resources page.