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How to improve employee retention with a workplace wellness program

Video • October 26, 2023 at 9:01 AM • Written by: Chase Charaba

Employee turnover can be costly for businesses in terms of time and money. One effective way to improve employee retention is by implementing a workplace wellness program. A wellness program not only promotes your employees’ physical health and mental well-being but also creates a positive and supportive work environment.

In this article, we'll explore how wellness programs and benefits can improve employee retention at your organization.

Get our guide on how to improve employee well-being at your organization.

What are wellness programs?

Effective wellness programs help promote healthy lifestyles. Employers provide them to employees to help them avoid illness and stress while improving their overall well-being. There are many different wellness programs, with some focusing more on physical fitness and others focusing on mental health.

Employers usually sponsor them, but some insurance plans or payroll services offer them directly to organizations.

How do wellness programs improve employee retention?

With a tight labor market, employees have plenty of options for work. Organizations need to provide employee benefits and other perks to attract and retain employees. Otherwise, your employees will go elsewhere.

One of the best ways to keep your employees is to offer wellness benefits. Employee well-being is essential to any organization because it directly affects productivity, engagement, and job satisfaction.

Employees increasingly desire added health and wellness benefits. According to MetLife's 2022 Employee Benefits Trends Study1, 52% of employees said health and wellness programs like gym memberships are a must-have. However, only 33% of employers said they offer or plan to offer these benefits.

Employees who feel stressed or unwell won't be able to put out their best work. According to a Gallup poll, 23% of workers felt burned out at work very often, and 44% of employees felt burned out sometimes. These same employees are 63% more likely to take a sick day and nearly three times as likely to look for a new job.

A wellness program can improve your employees' overall health and mood, reducing how often they’re out sick. These programs can also encourage employees to do more for their health at home, which helps reduce health risks and healthcare costs.

Improving employee well-being increases productivity at work. Employees who feel good about their workplace are more likely to stay engaged and recommend their organizations to others.

MetLife's study found that 51% of holistically healthy employees were more likely to stay at their organizations for at least 12 more months at the time of the survey.

What are some examples of employee wellness programs?

There are many types of wellness programs available. They can be as simple or complex as you'd like to meet your organization's needs.

Examples of standard programs include:

  • Smoking cessation programs
  • Employee health screenings
  • Biometric screening programs
  • Nutrition education classes
  • Vaccination clinics
  • Weight loss programs
  • Stress management programs

These are all examples of employee wellness activities with one goal in mind. However, your ideal program should include a holistic approach to employee well-being.

What should your employee wellness program include?

To achieve holistic employee wellness, you'll need to design a wellness program that touches on all facets of wellness, including physical health, mental health, social well-being, and financial well-being.

Designing your wellness program around these pillars ensures that it supports and includes all of your employees.

In-office employee wellness benefits

When employee perks first emerged, only large corporations, particularly tech giants, offered them as part of a corporate wellness program. Now, you can find these in-office perks at small and medium-sized businesses across the country.

Popular in-office employee wellness benefits include:

  • Promoting or offering healthy food options
  • Providing opportunities for physical activity in the workplace
  • Hosting events and activities to allow your employees to connect
  • Ensuring that everyone has access to mental health resources.

With any wellness program, you’ll also want to make time for in-office activities anyone can participate in.

Some ideas for in-office activities are:

  • Cultural awareness events
  • Games and quizzes
  • Taking a group walk
  • Creating a book club
  • Birthday celebrations
  • Company retreats (they don't have to be far from the office)

These wellness activities will help your employees get to know their teammates and feel more relaxed at work.

You can also schedule events around mental health, such as a group meditation session or nutrition and exercise classes.

Remote employee wellness benefits

With many organizations offering remote work options, creating a wellness program is more challenging than ever. Remote employees won't benefit from your in-office benefits and programs. So, how do you create a wellness program with these employees in mind?

You can modify in-office employee wellness efforts to fit a virtual work environment. This includes hosting virtual activities to help your employees feel connected. You can also provide care packages to your remote employees, such as healthy snacks or lunch once a month through a delivery service. Offering health and wellness benefits is another great way to improve your remote workers’ physical and emotional well-being.

These programs must adapt to each employee's needs to be successful. You can do this by offering your employees personalized benefits.

Offering personalized wellness benefits

One of the best ways to ensure that all of your employees can participate in your wellness program is to offer personalized wellness benefits.

Personalized benefits allow your employees to choose how to use their benefits. With personalized wellness benefits, you can provide your employees with a monthly allowance for expense reimbursement or an expense card.

There are various personalized wellness benefits available for organizations of all sizes. We'll break down a few of the most common ones below.

Health benefits

Supporting your employees' physical and mental health is one of the core pillars of any wellness program.

There are various personalized health benefits available, including health reimbursement arrangements (HRAs), health savings accounts (HSAs), flexible spending accounts (FSAs), and health stipends.

HRAs are a great option for businesses that want to offer an individualized benefit while saving money and time compared to a group health plan. Employers reimburse their employees for healthcare expenses such as individual health insurance premiums and qualifying out-of-pocket medical expenses with an HRA. HRAs are tax-free for both the employer and the employee.

If your organization has 50 or more full-time equivalent employees, the Affordable Care Act (ACA) requires you to offer health benefits to at least 95% of your full-time employees. An individual coverage HRA (ICHRA) is a great alternative to group health insurance for organizations that need to satisfy the employer mandate.

You could also offer your employees a taxable health stipend. Health stipends allow you to give your employees money for medical costs. This makes health stipends an excellent option for organizations with employees who receive advance premium tax credits, as those employees can use their health stipend benefit without affecting their APTC eligibility. However, a stipend doesn't satisfy the Affordable Care Act's employer mandate. You also can't require proof of purchase for health insurance or any items in IRS Publication 502.

Wellness stipends

A wellness stipend allows organizations to give their employees an allowance for a wide variety of wellness expenses. Instead of focusing on on-site wellness perks for your office, you can give your employees the freedom to choose how they want to use their wellness stipend.

With a wellness stipend, your employees can buy:

  • Gym memberships
  • Fitness classes
  • Wearable fitness trackers
  • Home exercise equipment
  • Personal trainers
  • Mental health counseling

Wellness stipends are taxable, meaning you'll need to report this extra income on your employees' W-2s. However, offering a wellness stipend is an easy way to ensure that you include all of your employees in a wellness program that works best for their individual needs.

How to boost employee participation in wellness programs

Worksite wellness programs can increase employee retention and promote a healthier working atmosphere if most employees are actively involved.

Organizations can do their part to encourage active participation by doing the following:

  • Don't strive for perfection: Plan for challenges and even the occasional failure with your wellness program. Set up a support structure to manage any obstacles.
  • Provide incentives for participation: An easy way to improve participation rates is by reimbursing employee wellness expenses.
  • Take a team approach: Improving employee health is hard work. Allow your workers to achieve goals with the help and support of their peers.
  • Address employee stress: Most workers aren't strangers to stress. Identify potential stressors in the workplace and teach techniques for managing high-stress situations in a positive way.
  • Build on past successes: Reflect on your program's successes and structure goals to use the same procedures and routines that helped employees overcome challenges.


In today's ever-changing workplace, it's clear that workers have specific wants and must-haves for their ideal job. Organizations that offer various benefits, including employee wellness benefits, have a better chance of attracting and retaining top talent.

When crafting your workplace wellness program, consider your employees' overall wellness needs. An effective wellness plan goes for a holistic approach that involves your employees' physical and mental health, stress management, and promotes inclusion and belonging.

If you're ready to offer your employees health benefits as part of your employee wellness plan, PeopleKeep can help! With our HRA administration software, you can easily set up health benefits in minutes.

Help your employees live healthier lifestyles. Schedule a call with a personalized benefits advisor to start offering health benefits at your organization!

This blog article was originally published on January 30, 2017. It was last updated on October 26, 2023.

  1. https://www.metlife.com/employee-benefit-trends/2022-employee-benefit-trends/

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Chase Charaba

Chase Charaba is the content marketing manager at PeopleKeep. He started with the company as a content marketing specialist in early 2022. Chase has written more than 350 blog posts for various companies and personal projects throughout his career. He’s worked for digital marketing agencies, in-house marketing teams, and as the editor for national award-winning high school and college newspapers. He’s also a YouTuber, landscape photographer, and small business owner.