The Principal 10 Best Companies-2004 Best Practices Highlights

All companies face similar challenges in offering employee benefits—skyrocketing healthcare costs, competition for the best people, the ongoing struggle to educate employees and more. What sets The Principal 10 Best Companies for Employee Financial Security apart is how they've dealt with - and often overcome - these challenges.

The following tactics represent the best of what these exceptional organizations are doing to help their employees achieve financial security and, ultimately, to help their businesses succeed.

Healthcare benefits

Make it easy for employees to exercise. Four years ago, Clipper Belt Lacer Company transformed a space set aside for smoking into a fitness area. The result has been some dramatic improvements in employees' health—as well as a reduction in healthcare expenses.

Stick to standard contracts. When shopping for medical coverage, it's generally cheapest to buy off-the-rack. The Distilled Spirits Council of the United States held its medical insurance cost increase to only 3.7 percent by moving to a more generic policy.

Increase the copay differential between generic and brand-name drugs. Clipper Belt Lacer Company widened its copay differential to $15 for generic drugs and $50 for brand-name drugs. "We're trying to make costs more visible and make us all more responsible," says Nancy Ayres, general manager at Clipper Belt Lacer Company.

Offer on-site health screenings. Pharmacists Mutual Insurance Company has offered on-site health screenings for more than 16 years. "We know we have had early detection of some potentially significant health concerns," explains Marilyn Deal, the company's vice president of human resources.

Initiate ongoing communication with insurance carriers. Don't wait until renewal time to think about your company's medical insurance costs "We keep in constant contact with our insurance carriers and start conversations earlier," says Mark Campobello, associate executive director of finance at American Urological Association.

Retirement benefits

Talk one-on-one with employees who aren't saving enough. Sometimes it takes direct intervention to encourage employees to save more. "If you talk one-on-one, you can get them to participate more," says Ayres of Clipper Belt Lacer.

Offer a match. Each of The Principal 10 Best Companies offers an employer matching contribution. The Distilled Spirits Council of the United States matches up to the first 4 percent of employees pay; the company's participation rate is an impressive 96 percent.

Automatically enroll new employees. USA Federal Credit Union takes this creative approach. As a result of this and other proactive efforts, the company boasts a 97 percent participation rate.

Bring in a financial expert. Distilled Spirits Council of the United States used a financial planner to encourage 401(k) participation. About 25 percent of the staff raised their elective contribution as a result.

Use the "1% Challenge." Challenge employees to increase their deferrals by at least one percent. At ELTECH Systems Corporation, 23 percent of employees increased their deferrals by one percent or more as a result of the company's "1% Challenge" campaign. American Urological Association saw 25 percent of employees increase deferrals after using the same campaign.

Help older employees catch up. Leupold & Stevens, like several of this year's winners, added a catch-up provision to their 401(k) plan so that employees age 55 and older could contribute an additional $3,000 to the plan this year.

Employee education and communication

Be persistent. Benefits education isn't a one-time event. The Principal 10 Best Companies use a variety of communication methods to remind employees regularly about the advantages of their benefits program.

One-on-one works best. If it's at all feasible, talk with each employee individually-especially new hires. "It makes people feel that you care about them and you can read body language to see if they're grasping what you're telling them," said Bob McCary, human resources manager at ELTECH Systems Corporation.

Give out "benefit bucks." To educate employees on the cost and value of benefits, Pharmacists Mutual Insurance Company gave out several thousand fake "benefit bucks" during an employee seminar and had employees use that money to pay, post-tax, for their benefits. Employees were surprised when they ended up owing money.

Give employees advance warning of changes. USA Federal Credit Union told employees in advance why the company was considering "It helped get employee buy-in and support of our decisions. When the changes did occur, they didn't have as big of an impact as they could have," says Tina Marie Wohlfield, human resources administrator at.

Lay it all out for them. Each and every quarter, Rathbun Insurance Agency takes the unusual - but effective - step of showing all 16 employees the company's entire financial statement. According to John Keel, the company's president, this helps employees appreciate the value of the company's benefits program.

Tailor communication methods for different age groups. "You need different types and styles and content of information based on age," explains Dr. Henri Manasse, executive vice president and CEO of American Society of Health-System Pharmacists. "Younger employees expect things to be delivered differently."