Benefits age faster than budgets do. You’ve probably felt that more than once in your own organization. Employee needs shift long before the next budget cycle rolls around, and renewal season has a funny way of exposing everything that hasn’t quite kept up.
Take work-life balance. In 2020, flexible work and leave surged in importance but were still viewed as pandemic responses. Half a decade later, Randstad’s Workmonitor 2025 research finds that work-life balance now outranks pay as the top job factor for 85% of employees worldwide — and for the first time, it also surpasses pay as a motivator for 79% of respondents.
That’s why here at Compt, we believe so strongly in the power of lifestyle benefits.
Countless other examples exist; I’ve watched this play out across almost a decade in the HR and benefits space. Companies don’t fall behind because they’re careless. More often, they fall behind because benefits are deceptively “set it and forget it.”
Let’s fix that with today’s guide, which details the six signs it’s time to reevaluate your employee benefits.
What is an employee benefit plan audit?
First things first:
An employee benefit plan audit is a structured review of your benefits program to see whether it still meets your employees’ needs and your company’s broader goals. It’s essentially a health check that tells you what’s still working and what’s outdated.
This is NOT an ERISA audit.
A benefit plan audit is a strategic review of your benefits package. It’s got nothing to do with your retirement plan filings or fiduciary responsibilities under ERISA.
You’re looking at the full picture here: health plans, wellness perks, stipends, leave policies, and the everyday extras you give your employees, with the goal of understanding whether what you offer still aligns with their personal and professional priorities.
Why run one in the first place? Two reasons:
- Your workforce evolves faster than your benefits. People get older. Some start families. Others relocate. Most face new financial pressures. Maybe they care more about professional development today than they did three years ago.
- Falling behind (not so) quietly hurts recruiting and retention. In the 2025 release of Gallup’s annual Employee Retention and Attraction report, they revealed “Pay/Benefits” is the most common single reason Americans left their jobs in 2024.
Well, is it time for your company to run a benefit plan audit? If you tick any of the following six boxes, the answer is “Definitely.”
When to reevaluate your employee benefits program
Nine times out of ten, your employees aren’t going to tell you outright they aren’t thrilled about their benefits package. Most people feel awkward giving that kind of feedback unless something is truly broken; I know I would.
So it’s the quiet warning signs that show up first. Look close enough and you’ll see them in your data, in broader market trends, and in the way employees actually use (or ignore) what you’re offering.
Here are some potential triggers to watch for:
Sign 1: Your survey or open enrollment feedback shows declining satisfaction.
Of all the signs your benefits program is outdated, this is the clearest.
If you send out an employee benefits survey and more than one-third of your company says they’re “dissatisfied” or “extremely dissatisfied” with their options, it’s clear as day: you need an employee benefit plan audit.
If you’ve just wrapped up open enrollment, that’s another easy place to look. See which plans people avoided and which questions kept coming up to HR. Those are the benefits categories at which you’ll want to look closely.
Pro tip: It’s best to survey your team annually; that way you can benchmark changes from one year to the next. When you make the YoY comparison, it’ll be even more obvious whether your benefits are aging out of alignment with what your employees actually care about.
Sign 2: Top talent leaves, and benefits come up in exit interviews.
When strong performers leave and they bring up benefits during exit interviews — even indirectly — you’ve got living, breathing proof your current setup is actively hurting retention.
Of course, turnover seriously disrupts team dynamics. But it’s also something that should concern your CFO; Gallup found that, on average, replacing someone in your org costs 40% to 200% of their salary, depending on their role.
If improving your benefits package could potentially turn that around, it’s certainly worth looking into.
To actively capture and record this info, create a simple tracker for every exit interview. Nothing fancy, just a table with columns like:
- Reasons for leaving (e.g., “Benefits” or “Total Comp”)
- Details (e.g., specific benefits referenced)
- What they were looking for instead
- Role/seniority
- Tenure
Sign 3: Your attrition or eNPS scores fall behind industry benchmarks.
Sign #2 is an easy tell, but employees won’t always connect the dots for you. You can’t just rely on them to mention benefits in their exit interviews or write a detailed review on Glassdoor.
Even if nobody’s vocal, facts are still facts. Right now, more than half of the workforce is watching for or actively seeking a new job, per Gallup. And further proving out the research above from Randstadt, WorldatWork reports that three-quarters of American workers say benefits matter as much as, or more than, their pay.
So if you notice voluntary turnover making a sharp increase and/or eNPS or engagement scores taking a nosedive, you’re almost definitely losing at least some of your people to competitors with better total comp packages. A benefits plan audit will tell you what you’re missing.
Sign 4: Competitors offer benefits your workforce now expects.
Take the group of employers with which you compete for the same people. (Tip: These aren’t only the companies in your exact industry.) Compare what they offer against your own package.
If they’re offering things like …
- Fertility benefits
- Elder care support
- Lifestyle Spending Accounts (LSAs)
- Professional development opportunities
- Caregiver support or expanded parental leave
… and you’re not, reevaluating your benefits program will help you align with what’s becoming the status quo.
After your employee benefits plan audit, you can look into how much interest your team has in specific perks. Competitive benchmarks tell you what people generally expect, then your own employees will tell you whether those benefits would actually make a difference in their lives.
Sign 5: Your benefits no longer match industry benchmarks or usage patterns.
When you look at employee benefits trends and see the broader market increase funding levels in a particular place or shift their focus to certain kinds of benefits, auditing your employee benefits package tells you whether you’re keeping up.
For instance, we track and publicize usage patterns from our own users. Our 2025 Midyear Lifestyle Benefits Benchmark Report found 65% of Compt customers offer an all-inclusive LSA. In the annual benchmark report we released in January 2025, that figure was 55%.
A +10% jump in half a year is wild in benefits terms. If you’re offering other kinds of stipends but not an LSA yet, it’s more than enough to make you wonder, “Should we be offering the same thing?”
You might not even need to increase spend or cut/replace anything. A lot of our customers find success by consolidating benefits or reallocating funds based on how people actually use them.
Let’s say usage for a gym reimbursement is consistently low but a vocal minority absolutely loves it. That’s an ideal use case for flexible benefits like LSAs through Compt, which let you roll unlimited vendors into one benefit that works for everyone.
Sign 6: Benefits admin is stretching your HR team thin.
It’s not only the talent market that’s changing. The software market is, too, and a benefits plan audit is just as much about how you run your program as it is about what you offer.
If you handle benefits like stipends in-house and haven’t revisited how you administer them in a while, chances are your HR team is doing a lot more manually than they need to.
And trust me on this one: If they’re hard to administer, they’re also hard to use.
Professional development is a perfect example. Almost every company offers it in some form, but most manage major components like tuition reimbursement separately from smaller ones like certifications because they feel like (and in many ways are) “different” benefits.
That makes consistent administration and taxable vs. nontaxable classification impossible. We built Professional Development Pro™ to centralize benefits and handle tax compliance, but you’d only realize you needed it in the first place if a proper reevaluation surfaced those inefficiencies.
What should an employee benefits audit include?
An employee benefits audit should walk through the hard data and employee signals, plus the operational realities of your program, so you can see exactly where your benefits align with your workforce — and where they don’t anymore.
Here’s what to include in your employee benefits audit checklist:
- Participation and usage data
- Survey results and eNPS insights
- Exit interview trends
- Competitive benchmarking
- Attrition analysis
- Stipend structure (i.e., taxable mix, cadence, funding)
- Administrative workload
- Compliance and documentation risk
- Vendor sprawl
- CFO budgeting considerations
- Opportunities for consolidation into an LSA or multicategory stipend
How to justify a benefits refresh or budget reallocation to your CFO
We’re people leaders too, so we get it. But your CFO probably cares about cost feasibility more than warm-and-fuzzy people outcomes, so you have to translate HR needs into financial ones.
When it’s time to justify a new benefits budget to CFO, this is how to do it:
- Lead with reallocation, not expansion.
Show which perks employees don’t use and how reallocating those funds into flexible benefits delivers more value without changing the total line item.
- Show the turnover math.
If your audit shows increasing attrition rates and benefits gaps competitors are actively exploiting, you have a financial argument: refreshing benefits costs considerably less than replacing your best staff.
- Highlight vendor consolidation savings.
If you can replace multiple low-usage tools with a single platform (or move fragmented benefits into one LSA), you get fewer renewals and invoices, plus better forecasting and a more predictable budget.
- Demonstrate predictability.
If you have multiple benefit categories and vendors with their own spend patterns and invoice cycles, it’s confusing. With streamlined monthly or quarterly stipends with one vendor, it’s not.
- Track and visualize everything in real time.
When you can show them exactly how people spend the funds and where you can trim or reallocate without hurting employees, they’re more likely to see benefits as an informed investment.
Build a better benefits package with Compt.
Sometimes reevaluating your benefits package means adding benefits your people now expect. Other times, it means reallocating dollars from low-use perks. And often it means fixing the operational mess behind the scenes so your HR team can actually run the program efficiently.
Compt helps you do it all.
With flexible LSAs and multicategory stipends, you can easily introduce new benefits without managing dozens of vendors. And most importantly, you can give employees more choice (to the tune of 28 flexible benefits categories and counting) without drowning HR in approvals or reimbursement requests.
Ready to see for yourself? Request a demo to chat (no pressure!) with a benefits expert.
