During the U.S. public-health response to COVID-19, many employees witnessed the closure of their physical workplaces and other community fixtures, including gyms, yoga studios, spas and similar facilities.
The latter group of closures affected employee engagement and retention efforts among employers that offer benefits programs centered around physical fitness and personal wellness. According to the Society for Human Resource Management's 2019 Employee Benefits survey, nearly one-third of U.S. employers offered fitness center memberships or subsidies or reimbursements for fitness classes. Such arrangements were more common than on-site fitness centers or classes, offered by 29% of employers as of last year.
Prior to the pandemic, physical fitness benefits formed "a major component" of wellness strategy, according to the SHRM survey. But providers that facilitate these benefits told HR Dive that COVID-19 necessitated a massive shift.
Providers follow the remote trend
Since March, a number of employers have closed physical worksites and asked employees to work from home. Per a July survey by Gartner, more than 80% of company leaders planned to permit some form of remote work after the pandemic.
The move to online work was accompanied by a movement to online delivery of certain employee benefits, including many healthcare services. A shutdown of in-person care led to increased use of telehealth services, and experts in the space suggested telehealth can continue to be an important part of the benefits ecosystem moving forward.
A similar development may be emerging with respect to fitness benefits. ClassPass, a fitness class booking platform with a business-to-business product, pivoted "very quickly" to virtual offerings as certain markets entered lockdown, said Nicole Wolfe, the company's head of corporate programs.
Employees using ClassPass can access online video sessions either by signing up for them in advance or by accessing pre-recorded content on demand. Since the move to virtual delivery, users are trying new types of programs in different markets, Wolfe said. Those based in New York, for example, might take yoga sessions delivered by studios in London. Fitness centers have also helped the company navigate certain public-health closures. When officials in San Francisco prohibited indoor workouts, some providers held outdoor events like bootcamps instead.
One-on-one fitness sessions have increased in popularity since the pandemic began, perhaps due to the fact that group classes are no longer available in many markets, but employers are also using ClassPass benefits as a way to team build, Wolfe said.
Other vendors made a similar transition. Peerfit, which offers an employee-benefit platform for scheduling personalized fitness activities, launched a digital product that made use of existing digital classes and other activities already on its provider network. It also allowed employers to purchase this digital product without the company's traditional brick-and-mortar offering, said Emma Maurer, vice president of enterprise health at Peerfit.
Before the pandemic, Peerfit also emphasized the ability of its platform to bring employees together via shared fitness experiences. That's continued during the pandemic, Maurer said. Streamed classes allow employees to invite their co-workers to join virtually.
"We are seeing our users starting to go back to in-person classes," Maurer said, adding that the number of subscriptions and views of digital content on Peerfit is also down from April. Providers within the company's network are beginning to reopen, albeit with additional health and safety precautions. "Gyms are taking this health crisis seriously and there are additional precautions that our members need to know about," she said.
COVID-19 hasn't led to significant cuts
Digital offerings might make sense in the current environment as some research suggests a potentially negative outlook for brick-and-mortar fitness centers. For example, a TD Ameritrade survey of U.S. adults published in May found 61% planned to exercise at home instead of paying for the gym. Across the country, reopening gyms and similar locations have struggled to comply with public regulations and mitigate the risks of exercising indoors during a pandemic, NPR reported in September.
Yet these observations haven't necessarily caused employers to drop fitness benefits. Most large-employer members of the Business Group on Health, roughly 80%, "have no plans to open on-site fitness centers anytime soon," said LuAnn Heinen, vice president of BGH and leader of its Well-being and Workforce Strategy Institute. "Clearly that only reflects the impact of COVID and not the import and the value of fitness programs that employers know employees need and value," she added.
Other Business Group members are either continuing with plans to open such centers in the future or have existing centers open in select locations, Heinen said, and vendors that offer access to digital fitness classes have become popular. "Companies that didn't already have those kinds of options are certainly looking into them," she explained.
Moreover, pushback on virtual fitness classes has been minimal, Heinen said. On a recent benchmarking call of BGH members, one HR representative said they had received some internal pushback on virtual-class usage. For the most part, however, Heinen said she hasn't heard talk of any cuts to fitness benefits from members. "Things may be a little bit on pause and getting recalibrated, but we haven't heard about cuts — I haven't."
This tracks with findings about employers' larger well-being investment during the pandemic. A survey conducted earlier this year by Willis Towers Watson found the vast majority of employers would not be changing their wellness benefit budgets, said Regina Ihrke, North America well-being leader at the firm.
The two vendors who spoke to HR Dive noted that they were both flexible with their payment options as the pandemic set in. Wolfe said that ClassPass has traditionally moved away from a per-employee-per-month payment model so that employers are paying for workers who actually use the program. "When the pandemic hit, we actually froze all our memberships," Wolfe said. "Now it's really kind of on them to determine when they want to come back on."
"Things may be a little bit on pause and getting recalibrated, but we haven't heard about cuts — I haven't."
LuAnn Heinen
Vice President, Leader of Well-being and Workforce Strategy Institute, Business Group on Health
"I think everyone was worried," Maurer said, noting that Peerfit's many public-sector clients faced falling revenues and had difficulty maintaining existing benefits without making adjustments, as did others. The company offered clients the opportunity to freeze their contracts for up to 60 days, keeping the benefit an option for employees if they wanted to buy fitness experiences for themselves. "It was more from a position of compassion [to freeze the contracts] than really anything else."
Peerfit is now seeing interest from clients in ramping up their fitness benefits, Maurer said, adding that employers may be concerned about COVID-19 causing workers to feel isolated. "I think employers are looking for a way to build back their culture, to create a sense of connectivity and togetherness again."
What wellness may look like post-pandemic
Employers who spoke to HR Dive mainly confirmed the importance of wellness benefits moving forward. Ultimate Kronos Group, the company recently formed from the April merger of Kronos and Ultimate Software, set up virtual fitness classes for employees and their children over the past few months, and the company plans to hold a competitive company-wide step challenge in October as employees work remote, said Chief People Officer Dave Almeda.
Tess Hamberg, a wellness consultant employed by Aetna who works with engineering consulting firm WSP, said that WSP shifted its wellness strategy to focus on supporting employees during the transition to working from home. WSP had already brought on ClassPass before the pandemic, and the ability to offer virtual access to classes was a component of a broader strategy to better match benefits strategy to the virtual environment.
Those virtual offerings are likely to be a permanent feature of WSP's benefits package moving forward, Hamberg said; "It’s like the cat's out of the bag at this point because we realize that it's an option that's now available to us. COVID really pushed a lot of people to realize we can do all these offerings that we didn't think of before or just never utilized."
Worries about employees' mental health are also likely to continue, Ihrke said, but employers who've spoken to Willis Towers Watson noticed increased engagement on digital communications regarding mental health, even as use of employee assistance programs decreased at some firms.
Those concerns can be addressed by digital offerings, though sources still perceive deficiencies in mental healthcare in the U.S. "COVID, like so many other things, exposed the cracks, the weakness and the needs that we haven't met in our healthcare system," Heinen said. "If [companies] didn't have a full suite of virtual benefits, they certainly have it now."
But wellness isn't one-dimensional. "There is this 'watch out' phase that's now starting to get heightened in not ignoring the physical well-being aspects," Ihrke noted, due to worries that employees are getting less activity and making less healthy decisions. "I think there is concern that, if we ignore that piece too long and just focus [on] mental health, we are going to face more significant issues long-term."
In the meantime, gyms, studios and other businesses are moving to accommodate the virtual trend long-term. "I think it's here to stay," Maurer said. "[Providers] have kind of learned that they needed another way to stay alive … if folks were still fearful of going back to gyms then they would need to offer virtual content."
