How to improve employee retention with a workplace wellness program

Written by: Chase Charaba
Originally published on April 19, 2022. Last updated December 29, 2022.

The average person spends one-fourth of their life at work. With much of our time unfolding in the workplace, it can be hard for some workers to create a healthy work-life balance. As a result, wellness activities can fall to the wayside, with many employees experiencing a drop in productivity or increased stress.

To combat this, organizations increasingly recognize the importance of supporting employee wellness in their workforce, with many implementing programs that promote overall health.

This article will explore how employee wellness programs and benefits improve employee retention.

Get more tips on offering a wellness program in our guide to employee wellbeing!

What are workplace wellness programs?

Workplace wellness programs are provided for employees to help them avoid illness and stress while improving overall employee wellbeing. 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.

Now that we’ve covered what a workplace wellness program is, let’s see how employee wellness can improve employee retention.

How employee wellness improves 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 an essential aspect of 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 Study, 52% of employees said health and wellness programs like gym memberships are a must-have. However, only 33% of employers say 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 are out sick. Wellness programs can also encourage employees to do more for their health at home, which helps reduce health risks and healthcare costs.

Improving employee wellbeing 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 wellness programs?

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

Examples of standard workplace wellness programs include:

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

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

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 wellbeing, and financial wellbeing.

Designing your employee 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, they were only found at large corporations, particularly tech giants, 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, and ensuring that everyone has access to mental health resources.

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 to 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 exercises classes.

Remote employee wellness benefits

With many organizations allowing their employees to work from home, creating an employee 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 ideas 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 the wellbeing of your remote workers.

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

Ready to build your own employee wellness program? Get our free guide to employee wellbeing

Offering personalized wellness benefits

One of the best ways to ensure that all of your employees can participate in your workplace 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 employee 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 insurance plan. Employers reimburse their employees for healthcare expenses such as individual health insurance premiums and qualifying out-of-pocket medical expenses with an HRA. And HRAs are tax-free for both the employer and the employee.

You could also offer your employees a taxable health stipend. Health stipends allow you to reimburse your employees for medical expenses like an HRA, without tax benefits or the additional compliance rules. 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.

See the difference between health stipends and HRAs with our free comparison chart

Wellness stipends

A wellness stipend allows organizations to reimburse their employees for wellness expenses. You simply set up a monthly allowance for reimbursement and either approve or deny reimbursement requests for the expense categories you allow.

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. You can reimburse employees for gym memberships, fitness classes, exercise equipment, and more with a wellness employee stipend.

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 participation in employee wellness programs

Workplace 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 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 an incentive to employees: An easy way to do this 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 wellness benefits as part of your employee wellness plan, PeopleKeep can help! With our HRA and employee stipend administration software, you can easily set up health and wellness benefits in minutes.

Schedule a call with a personalized benefits advisor today to see how personalized wellness benefits can fit into your organization

This blog article was originally published on January 30, 2017. It was last updated on April 19, 2022.

Originally published on April 19, 2022. Last updated December 29, 2022.


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