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What is ROI?
The best way to get the most return on employee wellness program would be to remember that it’s important not only for you but your whole staff. Having fun with it will make them feel like they’re actually taking care of themselves. Without feeling too forced upon which could lead to resistance rather than return.
Return on employee wellness program can be defined as the return on investment of an employee wellness program, which is described as a “benefit-to-cost ratio”. It identifies how much money employees save companies through reduced absenteeism and health care costs. The return can be calculated by using a number of methods such as Return On Investment Analysis or Benefit Cost Ratio Analysis. In order to have a return from your company’s Wellness Program, you need to do two things: create awareness for it and motivate people that they will get a return from being healthy.
Research shows that the ROI on comprehensive, well-run employee wellness programs is impressive, sometimes as high as six to one.
It is important to know that return on investment for wellness programs can be seen in many different ways, depending on what you are trying to calculate and how much time period the return will cover.
For example, there is a study that shows that “for every dollar invested by an employer in its employees’ health care programs produces more than $27 of value”.
The Return on Employee Wellness Programs
ROI or return on investment is the measurement of how effective the employee wellness program has been for the company. The return on investment in health care costs is measured by employees. Because only about 22% work well with high risks to their own lives and others around them if things go wrong. Many companies now want to encourage better habits through a wellness program instead of waiting until it’s too late. Employees who believe they will be rewarded for participating in these types of initiatives are much more likely to take part. So, sending out rewards after working towards goals can also increase participation rates as well as show an ROI.
The return on investment of employee wellness programs is showing that wellness programs can actually be beneficial when done properly. Employees who believe they will be rewarded for participating in these types of initiatives are much more likely to take part. So, sending out rewards after working towards goals can also increase participation rates as well as show an ROI. Many companies now want to encourage better habits through a wellness program instead of waiting until it’s severe enough that it starts affecting an employee’s work life.
Wellness programs can also help prevent disease and illness.
In a study by SHRM, return or ROI on employees’ well-being showed a 13 percent increase, after implementing an incentives program. It also shows how return or ROI on employee wellness programs is increasing. As companies recognize how health and happiness benefit everyone involved.
How Return On Investment of Employee Wellness Programs works?
Every company wants a healthy and active workforce, and every employee seeks good health. Employers and employees both know that these benefits are offered by wellness programs. And their effectiveness is measured by return on investment. The return on investment of wellness programs justifies implementing such programs by increasing productivity. They can help reduce healthcare costs in numerous forms. For example-
- Returns from reduced absenteeism
- By reducing healthcare costs
- Increasing Employee engagement
- Increasing annual turnover
Is it worth investing in a wellness program?
Nothing in life comes free, not even good health. If you are a company that wants to look after the emotional mental health or overall well-being of your employees. Then it is worth the cost. However, employee wellness programs benefit companies as well. The wellness programs provide tons of benefits. Improving health, productivity, of the employees. Long-term benefits include return on investment, decreased healthcare cost, and the company produces more revenue due to reduced absenteeism. Return on investment is not something that can be observed within a short period of time. When employee’s health improves, the company’s healthcare cost begins to drop down, and ROI increases.
When an employee is unwell, his/her productivity declines and that somehow affects the organization. Wellness programs make employees practice healthy habits, it boosts their energy, enhances mood, and promotes overall wellness. ROI analyses do not include the benefits of the employee positivity factor.
A company started to save $1500 per year after implementing a wellness program. Whereas one major hospital saw a reduction of 70% days lost to sickness and injuries. If the wellness program focuses on the mental health of employees, it can reduce absenteeism more and benefit the organization.
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