Are your employees struggling with personal legal challenges? As employers look for strategies to support worker well-being and boost productivity, legal benefits for employees can be an attractive option. Learn about the pros and cons of adding legal services, whether that’s as a standalone benefit or as part of an Employee Assistance Program (EAP).
Attorney Fees Can Put Legal Aid Out of Reach
Attorney fees can vary depending on the location, area of law and individual law firm, but these costs are often prohibitively high. According to U.S. News & World Report, most law firms charge by the hour, and the average hourly rate in the U.S. is $327 as of August 2023.
Even a single hour of legal assistance may be too much for many households to afford without financial stress. The Federal Reserve Board’s Economic Well-Being of U.S. Households in 2023 report found that 37 percent of adults would be unable to cover an unexpected expense of $400 without borrowing or selling assets. This means that many of your workers could have trouble affording legal assistance, and, as a result, they may not get the support they need.
What types of legal assistance do workers need?
For the average person, legal processes can be complex and intimidating. Your employees may seek legal aid for a variety of personal issues, including:
- Estate Planning and Probate: Employees of all ages may want to create or update estate plans to protect their loved ones or align with their retirement goals. They may also need guidance in handling probate after the death of a relative.
- Bankruptcy and Foreclosure: Although employed, workers can still face financial hardship due to factors like medical bills, excessive debt or unforeseen expenses, which could lead to bankruptcy or foreclosure.
- Divorce and Child Custody: Family law issues, such as divorce, child custody arrangements and adoption, can be highly stressful and often require legal assistance.
- Landlord-Tenant Disputes: Employees who rent may need legal assistance in disputes with landlords, particularly if the issue involves eviction.
- Lawsuits and Legal Rights: Workers may occasionally need support navigating legal issues or securing money owed to them.
Standalone vs. EAP Legal Services
Many employees could benefit from personal legal assistance but might lack the means or knowledge to access these services. Employers wishing to provide legal services as an employee benefit typically have two primary options:
- Standalone Legal Services Benefit: Legal insurance can be provided as a voluntary benefit, with employees covering the cost through payroll deductions.
- EAP Legal Services: Legal services under an EAP could offer a comprehensive approach by bundling legal aid with counseling, financial guidance and other resources.
Each approach has its own advantages and disadvantages. If your organization already offers an EAP to employees, depending on the EAP’s structure and provider, you may be able to incorporate legal assistance into this program. Alternatively, if no EAP is in place or the existing EAP does not allow for legal benefits to be added, legal services could be introduced as a standalone voluntary benefit for employees.
Understanding EAPs
EAPs provide employees with support as they navigate a variety of personal or professional issues. Services can vary, but they may include counseling, legal services, help finding affordable child care or elder care, financial education and various referral services.
Many employees face financial and personal stressors that can impact their concentration and sleep, consequently affecting productivity and attendance. By helping employees address these issues, EAPs may boost engagement and productivity, as well as serve as a powerful recruitment and retention tool.
However, these benefits can only be realized if employees take advantage of EAP services. Sometimes, employees may not fully utilize EAP services because they are unaware of them, so improved communications may be all that’s needed to boost participation. In other cases, they may have concerns about confidentiality. In general, EAP services are confidential, so employers can help alleviate privacy concerns to increase participation.
Should you offer legal services as an employee benefit?
Adding legal services as an employee benefit can be an effective way to support employees by helping them address legal challenges that could otherwise detract from work focus. However, these benefits require company resources, so it’s important to consider whether legal benefits align with your goals and priorities. Consider these questions:
- Are your core benefits strong? Legal service benefits can be thought of as a supplementary benefit that’s nice to have, but if your company doesn’t have strong core benefits – think health insurance and retirement benefits, as well as staples like life, disability, dental and vision insurance – these areas should be prioritized.
- How would legal services fit into your overall benefits strategy and goals? To create an effective employee benefits strategy, it’s helpful to identify specific goals. For example, do you want to use employee benefits as a recruitment tool? Are you trying to foster a workplace environment that is welcoming to a diverse talent pool? Once you’ve identified your goals, think about how legal services could fit into them.
- Are there other benefits your employees would want more? If your budget allows for only one new benefit, explore your employees’ preferences. For instance, they might prioritize options like fertility benefits, pet insurance or student loan repayment assistance over legal aid.
- How will you encourage participation? There’s no sense in offering benefits that your workers won’t use. When adding legal benefits, work with your employee benefits broker to plan a comprehensive rollout strategy. It may also be useful to get feedback from workers, possibly in the form of anonymous surveys, to gauge their interest level and identify potential implementation pitfalls.
Are legal assistance benefits right for your team?
If you’re interested in offering legal services, whether as part of an EAP or as a standalone benefit, Higginbotham can help. Our team specializes in creating employee benefits packages that are tailored to support your organization’s goals and demonstrate your commitment to employee well-being. Connect with one of our benefits specialists to explore your options and learn more.
