HR news and insights at your fingertips
From recruitment and retention to company culture and the latest HR technology, HR Brew provides the latest industry news and tips to help HR professionals stay agile in today's rapidly changing business environment. Masu.
If you want to go to a spa but don't have the money, don't worry, your employer will cover the cost. Or maybe if you offer a Lifestyle Spending Account (LSA).
LSAs have been around since the 2010s, but employers have only really started paying attention to them in the last few years, Kevin Robertson, executive director and CRO at HSA Bank, tells HR Brew. About 51% of employers surveyed by benefits provider Benepath offered his LSA benefits in 2023.
ADP research shows that LSAs can help improve employee financial well-being and therefore have a positive impact on employee retention. Approximately 74% of U.S. employees say they would be more likely to move to a company that offers better financial benefits, a Betterment at Work survey found.
How to use. These employer-funded accounts give employees financial flexibility to manage expenses not typically covered by traditional benefits. Mr Robertson said it was really up to the employer to decide what was covered by the LSA and how much funding was allocated to it.
“The thing about LSA is that it’s flexible,” he said. “You can design it very narrowly or you can design it broadly. It's really up to the employer's choice.”
Expenses that can be covered with an LSA include gym memberships, spa days, therapy, life coaching services, child care, pet sitting, estate planning, groceries, home office supplies, tax preparation, etc. Not limited. Seriously, the list is almost endless. .
“There are no restrictions placed on employers,” Robertson said. “There are no limits, so you can make it whatever you want.”
Mr Robertson said the LSA is 100% employer-funded and its benefits are low cost and easy to use and manage. Employees can also access the funds that their employer allocates to their LSA through a debit card (similar to how an FSA works), although Robertson says this method is more common. You can also use it through book refunds. That means the employee submits the receipt to her LSA provider. Your employer is cooperating and you get that money back, but no taxes.
zoom out. With 90% of Americans feeling financially stressed, according to a report from Discover and Thrive Global, human resources departments are uniquely positioned to offer solutions that can ease the financial burden on employees. Robertson said LSA is one tool he can add to a company's arsenal that can support staff while also making the organization a better place to work.
“take away” [employees’] “Financial stress makes them happier, more engaged and more productive,” he said. “The key is to have happy employees who are productive and stay with the company.”
