D.C.-Area Employers Cutting Benefits Costs

June 30, 2009 (PLANSPONSOR.com) - The Human Resources Association of the National Capital Area's (HRA-NCA) 2009 Washington DC Area Benefits Survey found that the average total of benefits as a percentage of payroll declined for the third straight year.

The average benefit rate for respondents representing a cross-section of employers in the D.C.-Baltimore area was 30.9% in 2007, 29.2% in 2008, and 28.8% in 2009, according to a press release.

A number of area employers changed their health care plans by reducing benefits to eliminate an increase in their actual costs. As a result, the actual average increase in the cost of plans after plan changes was 4.9%, down from an average of 6.2% before plan changes. To control costs employers also shared rate increases with employees, the press release said.

Defined contribution programs represent the majority of retirement programs offered by employers in the Washington-Baltimore Region – 401 (k) plans are made available by 72% of employers, 403 (b) plans are provided by 28% of all employers. Defined benefit programs are offered by 23% of the employers, mostly larger employers.

One of the significant changes found by the survey is the increase in percentage of employers combining various types of leave into paid time off (PTO) programs. PTO programs have increased from 36% of employers in 2007 to 43% in 2009.

The number of employers offering domestic partner benefits has increased from 43% in 2007 to 53% in 2009.

The survey was conducted from February through April 2009 and 265 organizations representing 191,921 employees responded. Results are available for sale at prices ranging from $235-$525, at www.hra.nca.org .