Flexible benefits and PTO demonstrate a commitment to DEI

Diversity, equity and inclusion (DEI) are issues often discussed in the context of hiring, promotions and salary, as these are areas where disparities between groups are often the most obvious. But just as representation and fair pay are crucial for building a more equitable company, the provision of benefits that meet the needs of a diverse workforce is another core DEI initiative that should be a focus of a company's HR department.

It's impossible for a one-size-fits-all benefits package to give your employees the support they need. While some employees will take advantage of more PTO (such as new parents), others might prefer to dedicate those resources toward a health savings account or a retirement fund. These generational differences are just one example of why companies that prioritize DEI should make their benefits packages as flexible as possible to account for the full range of their employees' goals and concerns.

Read more: 'Quiet quitting' isn't an option for minority workers, explains BIPOC CEO

By providing benefits that address their employees' diverse needs, companies exhibit flexibility — arguably the most important trait a company can have post-pandemic. Employees want to be viewed as individuals with their own unique preferences, but many benefits programs treat them as interchangeable with their colleagues. At a time when the labor market remains tight and turnover is high, companies can't afford to alienate their diverse workforces with outdated benefits.

Flexibility requires cultural change
While the clearest manifestation of the demand for flexibility among today's workforces is the continuing prevalence of remote work, this demand isn't confined to how and where employees work. When Deloitte asked employees if they would benefit from greater flexibility in the workplace, 94% said yes. However, 30 percent said the "potential consequences to their professional growth and lack of trust from leadership would prevent them from using flexible work options offered."

This is a reminder that merely offering remote work options isn't enough — companies have to build their cultures around flexibility. Just as employees often don't feel free to take advantage of flexible work options when they're available, many are concerned about the negative perceptions of taking vacation time. For example, 62% of employees say they're concerned that their boss would judge them if they requested time off to care for their mental health. Considering that improved mental health is the top benefit employees associate with workplace flexibility, this is a conspicuous disconnect. 

Read more: Best practices for committing to a successful DEI initiative

Concerns about stigma could be one of the reasons women are 43% less likely to use all their PTO in a year than men, while non-white employees are 19 percent less likely to do so than their white peers. It's clear that flexible workplace policies have to be accompanied by a significant cultural shift across the organization.

Diverse employees place a premium on flexibility
Companies have a whole lot of reasons to value diversity. Beyond the fact that increasing the representation of marginalized groups is simply the right thing to do, diversity increases financial performance, improves your company culture, and attracts job-seekers. According to a Glassdoor survey, 76 percent of job-seekers say a diverse workforce is an important factor in deciding where to work — a proportion that jumps to 80 percent among Black and Hispanic candidates and 79 percent among LGBTQ candidates.

But diversity on its own doesn't make a workplace equitable or inclusive. Recall the fact that women and nonwhite employees don't feel free to take as much PTO as their colleagues. While many employers think they're offering flexibility when they institute "unlimited" PTO policies, the effect on diverse employees could be to create even more anxiety around taking the vacation time they've earned. Diverse employees often feel like they're already under a microscope at work, and they don't want to invite anymore unnecessary scrutiny.

Read more: Just 57% of women are comfortable asking for a raise

A survey of 1,000 employees conducted by PTO Exchange found that employees who are allowed to convert their accumulated time off into other financial resources make different decisions based on their gender, socioeconomic status and age. Low-income employees prefer to have cash for emergencies, older employees want to make retirement contributions, and younger workers would put the funds toward student loan payments. Hence, another reason why one-size-fits-all benefits just don't work.

Flexible benefits will help you retain employees
Although the labor market might finally be cooling off a bit, high turnover rates and a lack of qualified job applicants are still major issues for companies. One of the most reliable ways to make your company more attractive to diverse candidates (while helping you retain the employees you already have) is by offering flexible benefits. Ninety percent of employees say these benefits would make them more likely to stay with their current employers – a huge advantage in today's labor market.

To fully leverage your flexible benefits program, it's vital to have an open discussion with employees about their professional aspirations, the struggles they face, and how the company can help. These discussions won't just provide invaluable information that will allow you to build a more effective benefits program but will also show diverse employees that their opinions matter and their voices are being heard (critical elements of employee engagement). 

Many companies say they're committed to DEI — they post about it on social media, include it in corporate brochures, and emphasize it in ads for candidates. But a real commitment to DEI should be reflected in a company's policies and culture, which is why the implementation of flexible benefits will demonstrate that your company is taking concrete steps to foster diversity and support all employees.