E-mail Used as Expanding Part of 401(k) Educational Effort

February 6, 2001 (PLANSPONSOR.com) - E-mail is now being used as a 401(k) educational tool by American Express Retirement Services.

The provider uses e-mail as part of a pre-conversion educational effort for workers at C.H. Robinson Worldwide, Inc., which has 3,600 employees in a global network of 136 offices.
American Express said this is “one of the first” times e-mail was used to communicate changes in advance of a change in service providers.
In the campaign, Robinson workers get weekly e-mails about changes in retirement provisions, as well as about changes in 401(k) coverage, and savings and investment programs. The messages contain color, graphics and links that are “visually more appealing than simple email text,” the provider said.
The e-mails allow employees to link directly to C.H. Robinson’s intranet pages that contain more information on the selected topic.
Growing Trend
Amex’s use of e-mail to communicate employee benefit changes is part of a sea change in how financial and benefit information is being disseminated.  An upcoming PLANSPONSOR magazine article cites a January 2001 survey by the International Foundation of Employee Benefit Plans which found that one-third of plan sponsors currently make employee benefits information available online. Another third of sponsors surveyed said they plan to have benefits information online in the next year.
One driving force for using the Web to disseminate 401(k) and other benefits changes is cost. Studies so far clearly show savings have been achieved. Greenwich Associates found from its studies that benefits staffing and administrative employment has “been trending downward for years,” according to Bill Jarvis, a Greenwich Associates principal.

At corporate funds, he said there are now 1.9 “full time equivalents” (FTEs) handling benefit communications, down from 2.2 last year.  At public funds, there are 4.7 FTEs compared to 4.5 in 2000, and at endowments there are 1.2 FTEs compared to 1.0 last year.
“The Internet can achieve savings in lieu of a call center since experience has shown that about 70% to 80% of participant questions are often the same. So the net can liberate a sizeable number of relatively highly-trained people from that role,” Jarvis said.