Workplace Flexibility: Trends and Insights

Jul 10, 2014

Are you looking for inexpensive yet effective ways to attract and retain top performers as skills gaps in the labor force widen and the fight for talent becomes fiercer?  Evolving expectations about work have changed what it takes to satisfy workers, including:

  • Millennial employees who want and expect more flexible and innovative workplaces;
  • Generation X employees who juggle work, aging parents, and young families; and
  • Older employees who are easing out of the workforce, caring for elderly parents, and trying to manage their own health while pursuing outside interests.

As an employer, you have little to fear.  Flexible workplace policies can provide strong and positive benefits for both employers and employees, according to a national study by the Families and Work Institute, a nonprofit center dedicated to providing comprehensive research on the changing U.S. workplace, evolving family, and changing community.  The Institute finds that effective and flexible workplaces generally have employees who are more engaged in their work, more satisfied with their jobs, and more apt to stay with their employers.  These employees are also more likely to be in better physical and mental health, to have lower rates of stress and depression, and to have less negative spillover between their home and work lives.  Many flexible workplace policies are relatively inexpensive to establish, and, with all of their associated benefits, can more than pay for themselves, as employers are quickly discovering.

The National Study of Employers (NSE) is a comprehensive study of working flexibility across organizations conducted by the Families and Work Institute (FWI) in partnership with the Society for Human Resource Management (SHRM).  It explores the practices, policies and procedures U.S. employers with 50 or more employees use to enhance organizational and employee success in the face of changing economic, workforce, and workplace realities.  The 2014 survey results are available, providing interesting insights into changes in workplace flexibility trends since 2008.  Specifically, the study explored aspects of flexibility including job challenge and learning opportunities, job autonomy, supervisor support for job success, a climate of respect and trust, economic security and work-life fit.

The major trend this survey finds, as you may have guessed, is increasing workplace flexibility.  As the U.S. has been slowly recovering from significant economic instability that characterized the late 2000s, employers have been reinventing work practices, policies, programs and benefits to align with new economic realities.  These efforts have aimed at maintaining or increasing workplace flexibility, likely in an effort to maintain employee engagement, to increase productivity, and, to help retain key employees and recruit new ones.  According to the study, the most common forms of flexibility include control over taking breaks, time off for important family and personal needs and flex time.

There are several interesting key findings from the study having to do with flexibility, caregiving leaves, child and elder care assistance, and health/economic security.  First, employers with 50 to 99 employees appear to be leading in providing workplace flexibility, beating out employers with 1,000 or more employees by staggering margins in measures of relevant attributes, such as flexibility of starting and ending times, working remotely, controlling break times, returning to work gradually after childbirth or adoption, and, taking time off during the workday to attend to important family or personal matters without the loss of pay.

Second, providing 12 weeks of job protected leave for qualified employees is becoming the norm for businesses with over 50 employees, as an increasing number of employers have attained compliance with the Family Medical Leave Act (FMLA) of 1993.  This protection applies to women following childbirth, employees following adoption, and employees caring for seriously ill family members, among others.  However, the survey finds employers in 2014 are much less likely to provide full pay during leaves for maternity-related disability than in 2008.  Although compliance with FMLA is gradually increasing, the study finds nearly one in five employers still appears to be out of compliance by not offering at least 12 weeks of paid or unpaid time off for at least one type of federally protected leave.

Third, employers are increasingly helping employees with personal and family care, including child care, elder care; employee assistance programs (EAP) and wellness programs, by providing financial assistance and/or resources and referrals to employees.  With regard to child and elder care, this primarily consists of providing dependent care assistance programs (DCAP) that allow employees to set aside pre-tax dollars for qualified expenses, as opposed to providing vouchers or other subsidies that have direct costs to the company.  EAPs help employees deal with personal and family problems and pressures as job demands increase, and wellness programs promote employee physical and mental well-being.

Finally, employers are providing health care coverage for almost all full-time employees and their eligible dependents.  Additionally, there has been a dramatic increase in employers providing health care coverage for domestic partners of employees, coinciding with changes in the approach to couple relationships, especially since the overturn of the Defense of Marriage Act (DOMA) in 2013.  However, most employers now require employees to pay a larger share of their health care premiums.  Notably, larger employers are more likely than smaller employers to have increased premium co-pays for both individual and family health insurance.

The study was able to identify some predictors of flexibility, child and elder care assistance and health care benefits among employers having to do with things like employer size, type (e.g., for-profit vs. nonprofit), level of workplace diversity, percentage of part-time and hourly employees, number of locations, union status, length of time in business and health of business relative to competitors.  Relationships between these types of characteristics and caregiving leaves were not found to be significant.  Perhaps not surprisingly, nonprofits tend to offer more programs, policies and benefits than for-profit companies.  Employers with more workforce diversity tend to provide greater support to employees; and, consequently, larger employers are more likely to provide a higher level of support when initiatives cost money.

What does all of this mean for your business?  In order to be competitive and attract great employees, you may need to think creatively about feasible flexible workplace policies in which the tangible and intangible benefits – including lower stress, better work performance, and improved well-being – outweigh the costs.

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