Employee benefits are a big topic when it comes to attracting and retaining good talent. But the challenge isn't just offering good benefits — it's managing them well.
If you don't have a full HR team, that task often falls on other business leaders. The language of benefits administration can be tough to understand. So here are my five steps to analyze your benefits — without having to get a Master's in HR Management.
When benefits are handled differently across departments, shifts, or employee levels, you're creating a compliance minefield. Common warning signs include:
👉 Waiting periods = time new employees must wait before becoming eligible for benefits
👉 Contribution matching = when employers match a percentage of employee retirement contributions
👉 Nondiscrimination tests = annual reviews to ensure benefits don't unfairly favor highly-paid employees
👉 Co-pays = fixed amounts employees pay for medical services
👉 ERISA = federal law that protects employee retirement and health benefits
👉 Summary Plan Descriptions = documents explaining employee benefits in plain language
👉 Form 5500 = annual report required for large benefit plans
👉 Cafeteria plans = benefit plans that let employees choose between cash and pre-tax benefits
Designate specific individuals responsible for benefits administration and ensure they understand their fiduciary responsibilities under ERISA.
👉 Plan administrator = person or company responsible for managing day-to-day benefit plan operations
👉 Fiduciary responsibilities = legal responsibility to manage employee benefit plans in the best interests of employees, not the company
👉 Participants and beneficiaries = employees covered by benefit plans and their family members who may receive benefits
Remember: Adding new benefits without proper oversight is like building on a shaky foundation. Each new program introduces additional compliance requirements, reporting obligations, and potential audit triggers. Your monitoring system must evolve alongside your benefits offerings.
Investing in the right technology eliminates human error and creates the documentation trail you need to demonstrate compliance during audits.
Train your management team to recognize potential compliance issues and establish clear escalation procedures. Create documentation requirements that make compliance violations visible before they become costly problems.
This means teaching supervisors to spot red flags like inconsistent benefit applications or employees asking why their benefits differ from coworkers in similar roles. When everyone understands the stakes, compliance becomes everyone's responsibility.
👉 PEO = Professional Employer Organization that provides HR services and shares employment responsibilities
If benefits administration is consuming too much of your time or you're concerned about compliance risks, it’s definitely worth exploring this option.
Don't wait for a DOL audit to discover compliance gaps. Take control of your benefits administration and protect your company's future.
Contact PRO Resources today for a comprehensive benefits analysis. We'll review your current plans, identify potential compliance issues, and provide a clear roadmap for protecting your business while enhancing your employee value proposition.
Remember: Good benefits attract talent, but compliant benefits protect your business. Make sure you're doing both.
About the Author
Stacy Gray is a seasoned Benefits Administrator known for her comprehensive expertise in employee benefits administration, HR policy development, employee relations, and people management. Throughout her career, she has successfully led initiatives that enhance employee engagement, streamline benefit programs, and ensure compliance with federal and state regulations.