OneSource Virtual blog

Benefits management is one of HR’s most complex tasks. Your program needs to be strong enough to support talent recruitment and retention, yet building that kind of program can be time-consuming and complicated. Below are five of the most common challenges HR professionals face when managing employee benefits, along with practical ways to address each.

Managing employee benefits is one of HR’s most important responsibilities, but it’s also one of the most challenging. Ensuring regulatory compliance, managing enrollments, answering employee questions, and overseeing vendor relationships all eat up time and resources — time that could be spent on more strategic work, like vendor negotiations and renewals.

Absence management wasn’t always as difficult as it is now. In the past, when an employee requested time off, a manager approved it, HR tracked it, and payroll adjusted accordingly. But things are more complicated now, with today’s patchwork of federal, state, and local leave laws; rising leave-of-absence rates; and the operational complexity that comes with multistate or hybrid workforces. Absence management is now its own discipline and carries real consequences when handled poorly.

Time off from work is more than just sick leave and vacation. It's emergencies, mental health days, parental leave, and much more. The impact of these is significant. Supervisors lose 4–5 hours per week — or over five weeks per year — managing absence coverage.

Benefits administration is the work of managing employee benefits programs — enrollment, eligibility, deductions, life events, compliance, and everything in between. It sits at the intersection of HR, payroll, and finance, and when it breaks down, employees are the ones who feel it first. That’s critical to keep in mind. More than three in five employees would consider leaving their current job for one with better benefits, even if it meant accepting lower compensation, according to a 2024 Aflac study.

In some states, terminating an employee starts a countdown clock. If you don’t deliver their final paycheck within 24 hours, you miss a critical deadline. From there, your problems can add up fast in the form of fines, lawsuits, and daily waiting-time penalties.

The era of the traditional biweekly paycheck is coming to an end.

With HR teams spending as much as 57% of their time on administrative tasks, strategic initiatives often take a back seat. This is far from ideal, considering how critical compensation management is to employee satisfaction, retention, and the success of your organization overall.

The HR technology market is exploding. In 2025, it’s at approximately $42.5 billion and is projected to reach $82 billion by 2032.