Employee Wellness Programs: Why Your Company Needs One

June 25, 2020

employees participating in a wellness yoga class


Employee wellness programs have become increasingly popular across companies of all sizes over the past few decades. [1]. Employee wellness programs were first initiated as an employee benefit and were advertised as a perk of working for some of these larger corporations. However, in a longitudinal study conducted by the Society for Human Resource Management (SHRM), 76% of surveyed companies offered some type of wellness initiative in 2014 [2]. Companies continue to expand their programs, finding creative initiatives for improving employee health.


What is an employee wellness program?

Employee wellness programs are employer funded and driven programs to promote healthy habits and lifestyles among employees. These programs may be referred to by a different name including workplace wellness, worksite health or employee health programs; however, all are focused on the promoting employee well-being including mental health, physical activity, enhanced nutrition habits and other healthy behaviors.


Why you should have a wellness program at work.

In the hustle and bustle of modern business, employees may be negatively affected by work factors including long hours, stress, and sedentary habits. Studies indicate that employee productivity are affected directly by health and wellness of the individual [3]. Therefore, developing a successful wellness program not only benefits individuals, but it also benefits the business.  Specifically, programs can lead to the following:

  • Reduced Levels of Stress: Health wellness programs are associated with lower levels of stress in employees which directly correlates with reduced health care costs [5].
  • Employees Take Fewer Days Off: Companies that utilize employee wellness programs have reported lower levels of absenteeism (employees taking time off work) compared to those that do not have these programs [5]. By promoting these programs, employees have reported enhanced overall health to include: lower reported instances of illness, lower levels of stress and reduced work-related injuries. These factors can result in lower healthcare associated costs for the employer.
  • Higher Employee Morale: Employees who work for companies with a well thought out and culture-oriented wellness program were reported to be 67% more satisfied with their jobs [6]. Happier employees are more effective at their jobs and are more productive than those that are unsatisfied in the workplace.
  • Higher Motivation: Employees that feel engaged in their work and are happier with their jobs and their lives, tend to lead healthier lifestyles. They are also less likely to suffer from chronic disease or obesity [8].
  • Enhanced Employee Productivity: According to one study, employees that participated in an employee health program and improved their health and gained a significant improvement in lost work time. This was shown to save the company on average of $353 (approximately 10.3 hours of productivity gain) per employee in a given year [4].
  • Employee Retention: Employee wellness programs can benefit employers through higher levels of employee retention. The top four companies of the American Psychological Association’s Psychologically Healthy Workplace Award winners had a low average employee turnover rate of 6% which is 32% below the national average [4, 7].
  • Personnel Recruitment: As part of the employee compensation package, employee wellness programs can serve as a distinguishing benefit. 87% of people reported that they examine the employer’s health and wellness initiatives and programs when deciding whether to accept a position with a company [7].
  • Reduced Healthcare Expenses: 72% of employers that maintain employee health initiatives reported that these programs were effective at cutting health care costs [2, 5].

Employees are an essential company asset. Many businesses are seeing the benefits of having a stronger and healthier workforce and report employee health improvements, rather than financial gain as the primary reason for developing employee wellness programs. Healthy and happy employees have a positive effect on the business which has been directly linked to the success of the company.

How do wellness programs help employees?

In addition to benefiting employers, employee wellness programs can contribute towards direct health benefits for employees.  In a survey conducted by SHRM, 86% of businesses reported that wellness programs were effective at improving the physical health of their employees overall. Physical activities promoted at work also improve the psychological wellbeing of employees [9]. It is common for programs to include a mental health component.

Social and organizational support programs have been the most effective factor in increasing enrollment rates [8]. These provide opportunities to bond with their fellow employees and make a difference in their workplace and local communities creating stronger feelings of belonging and gratitude. In one study, 77% of employees indicated their wellness programs had a strong impact on positive work culture and enhanced their desire to interact with peers and co-workers [7].

How to implement a wellness program at work.

Starting an employee wellness program may seem daunting with regard to the organizational, economic, systematic, legal and logistical challenges [11]. The following steps may be helpful guidelines to begin the process of developing, initiating, and maintaining a program:

  • Set Goals: As with any new business initiative, specific goals should be set that will benefit the company as well as employees. Examples of goals could be to reduce absenteeism, increase employee morale, and retention or promote teamwork.
  • Survey Employee Interest: It is good idea to ask employees what types of programs they would like to have available and what things they would participate in. Gauging interest will help direct and prioritize programs to roll out.
  • Create a Team to Implement the Program: Success relies on clear commitments from the leaders of the business and the formation of a cultural change among employees and supervisors toward prioritizing health and wellness [11, 12]. Forming a committee or team of supervisors and other employees that are dedicated to the mission of improving the employee wellness initiatives will aid in the formation, promotion, maintenance, advancement, and success of the program.
  • Baseline Health Survey or Health Risk Assessment: Conducting voluntary health information surveys can help to determine which programs are needed by the employees [12, 13]. For example, a smoking cessation program may or may not be beneficial depending on the number of employees at the company that smoke regularly.
  • Find the Best Ways to Get Employees to Participate: Over half of companies offer rewards for program participation. Additional incentives increased employee participation by over 80% [2]. The most common incentives used are small monetary bonuses or small gifts such as wearable fitness devices to create gamification among co-workers. The largest barriers to participation in employee wellness programs are time constraints, lack of social connection to co-workers, motivation to continue the program, add-on costs of programs and overall lack of interest in the programs [6].
  • Communicate the Program: Only 51% of employees feel that they fully understand what programs are offered by their employer and how to get involved in these programs [7]. It is therefore not surprising that about half of employees utilized any provided wellness initiatives [2]. Enrollment rates are inversely proportional to salary. Low wage employees are around 20-30% less likely to participate in health and wellness activities than higher wage employees [13]. To combat these enrollment issues, the team could work with marketing or internal communications teams to promote and advertise incentives and benefits or participation [14].
  • Get Constant Feedback from Employees and Evaluate Success: Surveys should be utilized at the beginning and end of each program to analyze program adoption and success. The feedback should represent the goals for the business, employees and the specific program as discussed at the beginning of this list. The data collected could include information such as participation rates, health care costs, return on investment, employee health behaviors, employees health information, or willingness to continue the program [12].
  • Optimize the Program: Conduct environmental audits in addition to ample surveys to determine the factors in the workplace culture that could have an impact on employee health behaviors [12]. This information will provide a template to determine if the initiative is beneficial to the business mission or if it needs to be replaced or optimized.

While these steps can seem intimidating at first, there are plenty of third-party providers of employee wellness programs that can help to create and maintain these initiatives. However, it is still important to have an internal committee that can reevaluate the programs in order to maintain effectiveness, focus on program goals and promote the initiatives to co-workers. This is essential to successful engagement levels.

What to include in an employee wellness program?

  • gym membership incentives
  • mental health and stress relief activities
  • social activities to bond with coworkers
  • community service activities
  • encouraging alternative methods of transportation (biking or walking)
  • on site fitness centers or classes (yoga or other small group fitness classes
  • healthy food and snacks at on site cafeteria and at meetings
  • nap rooms or massage chairs in break areas
  • hand and nasal sanitizers

Different types of wellness programs.

  • smoking cessation programs
  • stress reduction
  • weight loss programs
  • physical fitness challenges
  • health risk assessments
  • health screenings (biometric screenings)
  • exercise programs and activities
  • nutrition education
  • convenient vaccination clinics (free flu shots and job or travel related vaccines)
  • financial education


Employee health and wellness programs provide many direct advantages to the employee, as well as to the employer. Social and financial support are the leading factors for successful implementation, enrollment, and maintenance of wellness programs [10]. While 72% of surveyed businesses found that employee health programs were effective at saving wellness associated costs, only 31% of companies feel that their health and wellness programs are satisfactory [2, 7]. In a recent Harvard study, it was found that the average return on investment of employee health and wellness programs was $3.27:1 on health care reduction costs and $2.73:1 on absence related costs [15]. However, these benefits were not realized until three years after program implementation suggesting that these programs are more of a long-term investment. Fortunately, most employers stated that direct benefits to employee health is the primary incentive for them to offer workplace wellness programs rather than financial returns.


While employee wellness programs initially were found primarily as an employee perk for large corporations, they appear to be most effective in small businesses. This has been demonstrated by higher enrollment rates resulting in greater improvements in overall health, smoking status and physical activity when compared to larger companies [10, 16]. With companies of all sizes seeing the vast benefits of maintaining an employee wellness program, it is becoming more likely that these plans will be an expected component of all employee benefits packages in the near future rather than the add-on perk and recruitment tool that they were in the past.


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  2. (2017, May 19). 2014 Strategic Benefits―Wellness Initiatives. Retrieved June 03, 2020, from https://www.shrm.org/hr-today/trends-and-forecasting/research-and-surveys/Pages/2014-shrm-strategic-use-of-benefits-wellness-initiatives.aspx
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    doi: 10.1097/JOM.0b013e3182a50037
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  8. Yu D, Harter J. (2020, January 05). In U.S., Engaged Employees Exercise More, Eat Healthier. Retrieved June 03, 2020, from https://news.gallup.com/poll/159845/engaged-employees-exercise-eat-healthier.aspx
  9. Abdin S, Welch RK, Byron-Daniel J, Meyrick J. The effectiveness of physical activity interventions in improving well-being across office-based workplace settings: a systematic review. Public Health. 2018;160:70‐ doi:10.1016/j.puhe.2018.03.029
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  11. Cahalin LP, Kaminsky L, Lavie CJ, et al. Development and Implementation of Worksite Health and Wellness Programs: A Focus on Non-Communicable Disease. Prog Cardiovasc Dis. 2015;58(1):94‐ doi:10.1016/j.pcad.2015.04.001
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