Gallagher's proprietary data platform and experienced analysis lead to insights that inform changes.
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An employer suspected that some employees were using a time-off program as a retirement savings plan, eroding access to vacation and costing the organization money. Gallagher's proprietary data platform and analysis provided clear visualization of the issue and data to resolve the issue.

Challenge: Time-off program generates unintended results

Client summary

  • Aerospace industry.
  • 90,000 employees.
  • Many workers are reaching retirement age; a skills shortage could threaten productivity and efficiency.
  • Talent attraction and retention are critical to supporting the growth strategy.
  • Employees aren't using the PTO they've earned to support physical and emotional wellbeing.
  • Leaders consulted with Gallagher to understand the situation and to reduce accrued time-off balance costs.

Anecdotal evidence suggested to organization leaders that some employees were using one of the time-off programs as a retirement savings plan. Such a practice by employees can erode access to much-needed time away from work, as well as cost the employer significant dollars in accrued time-off balances. Leaders felt they weren't getting the return they wanted on their compensation and benefits investment.

Leaders needed data to quantify the issue to generate actionable information and to support the employer's value proposition. Further, leaders needed to address the cultural aspect behind why employers may not be using their time off.

Solution: Better visualization for issue assessment and analysis

Gallagher's proprietary data platform and experienced analysis provided clear visualization of the issue. Data revealed that the Baby Boomer and Generation X groups of employees had accrued the largest average paid time off (PTO) balances at 171.6 hours. Further, these groups showed a higher-than-average number of 401(k) loans, at 65.6 hours. The average balance of accrued PTO time equaled about 680 days. The Gallagher team helped to quantify the cost of this activity to the employer, which underscored the need to take action.

Result: Cost avoidance and confident positioning for growth

The Gallagher team examined actual account balance and time-off use across a generational analysis to inform plan design changes. The employer revised the time off policy to restrict the accumulation of hours. Additionally, the employer brought in money coaches as internal financial wellbeing education for employees.

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After working with the Gallagher team, leaders are better positioned to save costs and support employees in using their time-off benefit.

Employers don't just think they know — they know they know

The Gallagher team quantified that specific employee cohorts (Baby Boomers and Gen Xers) actually were using the time-off plan as a wealth creation tool. The data correlated generation utilization with unintended corporate spend. With this insight, leaders were able to realign the time-off plan with corporate goals. A renewed perspective also supported revised messaging to address the importance of using paid time off.

Gallagher's digital suite goes beyond dashboard metrics, allowing leaders to leverage data to enable new behaviors. Access HR technology for engagement, analytics, insights and integrated delivery options. Employers see the bigger picture and understand the real facts, using data to drive decisions.

Gallagher's Human Resources and Compensation Consulting team can help your organization leverage data and technology for better engagement, analytics, insights and integrated delivery. See the bigger picture and understand the facts, using data to drive decisions. Contact us for a conversation.

Disclaimer

Consulting and insurance brokerage services to be provided by Gallagher Benefit Services, Inc. and/or its affiliate Gallagher Benefit Services (Canada) Group Inc. Gallagher Benefit Services, Inc. is a licensed insurance agency that does business in California as "Gallagher Benefit Services of California Insurance Services" and in Massachusetts as "Gallagher Benefit Insurance Services." Neither Arthur J. Gallagher & Co., nor its affiliates provide accounting, legal or tax advice.