How to Deliver Bad News to Employees: What to Do When Benefits Change

person on a serious phone call

Published 9/21/2017, updated 2/28/24.

Delivering bad news to employees is always a bummer. But when it impacts their benefits? It’s even worse.

Thanks to an extra-steep rise in healthcare costs this year, Jellyvision customers tell us they’re making more changes than usual to their benefits packages. Many organizations are switching healthcare providers, changing network designs, or swapping out plans for more cost-effective options.

But HR pros also know that benefits are one of the most important ways to maintain strong employee engagement. A sudden healthcare change or cutback could send your workforce running, causing more costly issues that you probably can’t afford.

So if you’re notifying employees of benefits changes this year, we’re here to help. Here’s how to communicate effectively and empathetically, in a way that will minimize backlash.

How to deliver bad news at work: laying the foundation

Breaking bad news to employees starts with you, the HR leader. Before you spread the word about benefits changes, it’s important to understand your role and the goals you’re hoping to achieve.

First, let’s acknowledge that you’re stuck between a rock and a hard place. On one side, you’re responsible for representing your C-suite and the healthcare decisions they’ve made. On the other, you’re an advocate for employees, and they’ll come to you first with questions or concerns about the changes you’re making. In other words, you’re Switzerland—effectively presenting leadership’s point of view and also listening to the frustrations of the team. 

So it’s important to start with the right mindset. Understandably, employees are going to be upset if you’re decreasing coverage or increasing costs. And while you might not be able to control what’s changing, you can control how you communicate the news, and how you respond to their reactions. That’s where preparation and a strong messaging strategy can make a world of difference.

How to break bad news to employees in 5 steps

1. Start in person, and follow up with documentation.

No one likes to get dumped in a text message, right? The same concept applies to communicating benefits changes.

Even a small change to your benefits can greatly affect your employees, especially when money is involved. So don’t leave it to a company-wide email or out-of-touch announcement letter, which might lead to resentment and confusion.

Instead, communicate benefits changes in a live meeting first (either virtually or in-person). And while it might be tempting to sugarcoat things, don’t beat around the bush. Be clear about what’s changing, and why. Speak in plain English, and acknowledge how difficult these changes might be for your workforce. Give folks an opportunity to ask questions, and direct them to follow-up resources if they have questions afterward.

Then, follow up with email reminders and Slack messages to help employees digest and navigate their new benefits.

2. Test the announcement with a small group. 

We could all use a pulse check now and then. And when it comes to delivering bad news to employees, it can be helpful to gauge reactions ahead of time.

Put together a small group of trusted employees, with a range of different job titles and seniority levels. Ask them for their opinion on the changes they’re making, and how they anticipate folks in their department will react. It’s a great way to gather information on how people will react, and what questions you’ll receive when you share the news company-wide.

Who knows? You might be surprised by how few employees react poorly to the news. Regardless, sourcing some initial feedback can help you adapt and pivot your communications plan as necessary. 

3. Be human. 

It’s easy for corporate messaging to go…well, too corporate. But you’re not a robot, and healthcare is deeply personal. If you’re making benefits changes, it will have a real and human impact on your employees and their families. 

So cut the jargon and speak to your workforce sincerely and empathetically. After all, you’re an employee at your company too, and benefits changes affect you just as much as the rest of your staff! 

Show your workforce that you personally understand how hard it may be to adjust to a new health plan, and that you’re still committed to offering the best possible care. Use clear, simple language that feels like you’re talking to a friend instead of a faceless, nameless audience. Lead with empathy, and make yourself available if employees need additional support.

4. Personalize where possible.

If you’re making sweeping changes to your benefits, it’s likely that all of your employees will be impacted. But some may feel it more than others, so segment your messaging when possible. 

For example, if you’re transitioning from offering multiple health plans to an HDHP only, send targeted communications to folks who have never enrolled in an HDHP before. Share additional details about how their deductible and premiums will change, how that will impact each paycheck, or link to HDHP-specific resources. 

5. Lean on technology.

Benefits changes or not, employees are going to have lots of questions throughout the year—when they’re enrolling, and every time they make a healthcare decision. And you can’t be there to break down every new benefit detail or guide each person towards the most cost-effective choices for them. 

That’s where the right technology can offer a few shortcuts and help you get smarter about your year-round communications. A benefits engagement tool like ALEX helps employees make the best decisions for their health and wallet—at enrollment, and as the platform learns more about its users over time.

And with ALEX Central, you’ll have countless pre-made marketing materials at your fingertips so that you can promote ALEX to your workforce. No extra work necessary! 

The best part? We’ll let you in on what ALEX has learned about your employees, too. Our analytics dashboard offers simple, real-time reporting so that you can monitor the success of your benefits changes, and gain insights into employee behavior. From there, you can evolve your program design even further, prioritizing the highest-performing and most cost-effective plans.

We’re here to help when you’re notifying employees of benefits changes

Delivering bad news to employees is never fun. And in a year when you’re likely making more changes than usual, it can be tempting to run in the opposite direction. But there’s good news: you don’t have to go it alone.

We put together a complete guide to help you communicate effectively, avoid backlash, and maybe make the news sting a little bit less. We even included sample emails, texts and Slack messages you can send to your workforce, saving you time and energy.

And of course, we’re always here if you’d like to talk about your organization’s unique benefits communication challenges. Our team is ready to share what we’ve learned from our decade of benefits engagement experience! Book a demo to get started.

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