How important is it to your organization to have “identity protection” show up in your employees’ total compensation reports? In the past few years, concerns over identity theft have slowly been making their way into benefit options as companies look differently at protecting their employees from data hacks. With the massive security breach at Equifax Inc., which, according to USA.gov affected 143 million consumers, even more companies are likely to add identify theft protection to their complement of employee benefits as early as 2018.
Current estimates are that about 35 percent of companies now offer some sort of identity theft protection. The reasons are straightforward. Security breaches expose an individual’s personal data – driver’s license, bank account, and social security numbers – to relentless hackers. The Insurance Information Institute notes that in the last seven years, identity thieves have amassed $107 billion from stolen identities. Many hackers take the data to sell it, such as bundling credit numbers to sell in groups to willing buyers, or keep the best data to use for themselves and use it to steal from unsuspecting individuals. From law offices to Dropbox, hacks pose a serious threat to employee well-being, and company benefits are a critical avenue for companies to respond. And companies must respond because the costs of identify hacks are high.
For employees, the costs extend far beyond recovering overcoming any direct financial losses. It can take months of phone calls, emails, and correspondence to contact creditors and repair credit reports. Most of those calls must be made during working hours, so many victims of identity theft are either distracted at work or need to take some time off. The amount of time an employee must consume during normal working hours to straighten out this mess that’s of no cause of their own are way more hours of company time than any company would want to lose. But, the employee has no choice. So, if you won’t give it to them, they may feel forced to take it anyhow.
Other victims find that having their identity stolen is traumatic, which means they must also recover from the emotional stress. For these reasons, identity theft can lower employee productivity.
For companies, however, the benefit to the bottom line begins with their employee’s well-being. While the jury is still out on the effectiveness of anti-identity theft protection, studies show that employees gain peace of mind from the benefit, and with peace of mind comes increased productivity – and profitability. Identity-theft protection offers peace of mind to companies, too, because most hackers make their way into corporate accounts through employee’s personal records. Shutting down employee identify theft also protects the company.
The best news for employees and employers is that the benefit is not only low-cost to employees since it is non-taxable benefit, but companies can usually get the employee coverage from issuing companies either free-of-charge or at a steep discount. There is a great likelihood that companies can successfully negotiate a preferred rate from a quality service.
It should come as no surprise that the fastest growing benefit option is identity theft protection. So, companies moving too slowly with ramping up their identify theft protection benefit risk losing their competitive edge in recruiting and retaining valuable employees.