What Is an Employee Assistance Program?
Definition & Examples of Employee Assistance Programs
An Employee Assistance Program (EAP) helps employees navigate life challenges, adverse events, stress, and other issues that can affect their productivity at work. These programs are usually voluntary, free, and employer-sponsored.
Learn more about employee assistance programs and how they might be right for your team.
What Is an Employee Assistance Program?
In a perfect world, employees' personal lives would never affect them at work. But the reality is that many workers spend time on the job worrying over personal matters that can reduce their effectiveness and curb their productivity. This has led to the development of Employee Assistance Programs, which provide support and resources for struggling employees.
An EAP is a unique employee benefit that works as an intervention program. It serves to identify and help employees resolve problems they may be facing in many different areas of life:
- Marital or family issues
- Substance abuse issues
- Other personal issues
These are problems that interfere with employees' ability to perform their work to company standards. In some cases, the problem is serious enough to put the employee and the company at risk. EAPs can help employees resolve these problems through evaluations, referrals to other professionals, and counseling. This way, employees can get back on track both personally and professionally.
EAPs are strictly voluntary—that is, the employee under duress can choose not to participate. However, if they do choose to participate, the entire process is handled confidentially. This allows employees to get the help needed to overcome a problematic situation but also prevent third parties involved in the situation from retaliating against them or other employees at the firm. In this sense, the EAP protects the interests of both the employee and the company.
EAPs are often third-party services, as opposed to in-house services of the company where the employees work. These unique benefit programs come with expertise and resources beyond what a typical employer can offer, which takes the burden off the employer and reduces the personal risks posed if a manager or a co-worker were to attempt to mediate the situation themselves.
How Employee Assistance Programs Work
While no problem is too small for an employee to seek help from an EAP, these programs are particularly useful for employees who are under a great deal of emotional stress because of professional, marital, or familial discord. They may be coping with a serious health issue with a parent, have an out-of-control child at home, be facing overwhelming student loan debt, or just need to talk with a caring counselor about a personal problem.
For example, an employee might be experiencing domestic violence at home. Over a period of time, they might arrive to work late and stay long hours, and be less productive and more distracted. An observant manager at an organization with an EAP can refer this employee to the human resources department to receive information about the EAP and seek counseling or other support. Because of the confidential nature of EAPs, the employee can get the help needed to escape the situation but can also prevent the spouse from showing up at the workplace unannounced and causing harm to them or someone else at work.
In many cases, the spouse or partner of the employee can also obtain support from the EAP in sorting things out so that the employee can experience a more positive work and personal life. Some EAPs also include access to free and low-cost legal aid and referrals to attorneys who work with people in the community.
It’s important to note that EAPs are not actual health insurance plans, nor do they provide financial support to employees. They generally cannot diagnose a health issue or replace traditional medical or psychological evaluation and treatment.
An Employee Assistance Program should be used to supplement—not replace—a comprehensive employer-sponsored health insurance plan.
EAPs are generally paid for in full by employers and are most often operated through an agreement with a third-party administrator. This is critical because employees must feel comfortable speaking in confidence with a professional about their personal problems without fear of losing their jobs or status at work. However, EAPs are not portable benefits—they expire upon termination from the company benefits program.
The benefits provided by EAPs are generally treated as excepted benefits not subject to COBRA and Affordable Care Act (ACA) guidelines if they provide referrals as opposed to direct medically related support.
However, if the EAP offers direct medically related support, such as mental health counseling or treatment for alcoholism or substance abuse, they are subject to COBRA and ACA guidelines. According to the U.S. Department of Labor and ACA guidelines, EAP benefits are only regarded as excepted benefits if they do not offer "significant benefits in the nature of medical care or treatment."
Your company could be subject to ACA employer penalties for not providing adequate care if the EAP offers direct medically related support as opposed to referrals to other professionals.
EAP plan administrators at a company should encourage employees to take advantage of the no-cost benefit, which is generally available at any time of the year. All employees should be advised about the EAP and given instructions about how to access these benefits at no cost to them when they need support.
Managers can and should refer employees to the EAP if they are unable to resolve a matter through on-the-job coaching and HR support. While the company may know that an employee has participated in the EAP, the employee’s specific situation is kept private and never disclosed to the employer.
How Much Do Employee Assistance Programs Cost?
An EAP is generally offered at no cost to employees up to certain plan limits, making it a win for your workers. And although these programs are not free for employers, the return on investment for EAPs is typically $3 for each $1 spent.
EAP costs have stayed stable in comparison to costs in other areas of employer health care spending. In addition, the employer costs may be partially offset by gains in productivity and the potential employer health care savings for more serious medical treatments that could be needed if persistent problems or negative behaviors are not caught early.
How to Get an Employee Assistance Plan
The overall purpose of any employee assistance program is to ensure that employees are able to manage their daily lives and remain productive at work, even when faced with difficult life experiences. To support that aim, it's important to evaluate the benefits, costs, and online reviews or word-of-mouth feedback for any EAP before you choose one.
As you narrow your options, keep in mind that EAPs are only one component of a competitive benefits package. However, they can be highly beneficial in the workplace because they promote employee self-managed care, which can reduce employee stress and boost company productivity.
- Employee assistance programs (EAPs) are voluntary, employer-sponsored programs that help employees navigate stressful life circumstances.
- EAPs are usually free for the participating employee to use.
- EAPs aren't free for the employer, but are shown to provide a 300% return on investment.