A more diverse workforce requires a more diverse benefits package. That’s where Lifestyle Spending Accounts (LSAs) come in. At a From Day One’s webinar, leaders spoke about how Forma helped grocery tech company Instacart cater its LSA to better serve its 4,000 employees worldwide.

“We have a lot of different ages and demographics within our employee population,” said Margaret Fairbairn, director of global benefits for Instacart. From engineers to customer service agents to data scientists and general accounting, every one of them has different lifestyle needs.

Instacart enlisted the help of Forma, a life benefits platform that takes a different approach to company benefits. Founded in 2017 by Jason Fan, Forma has grown to support over 300 employer groups with a half a million employees around the globe. 

The idea when starting Forma was to transform the way companies provide employee benefits—specifically be flexible and focus on what employees really need. 

Reshaping Benefits

Prior to Forma, Instacart had some fragmented lifestyle benefits options, Fairbairn says. Wellness apps, step challenges, to name a few, but the feedback wasn’t great. “They didn't really resonate with all of our population,” she said.

What they needed was intention, strategy, cohesion. “We were looking to pursue something that felt like it would encompass and capture what we wanted to do.”

Working with Forma, Instacart came up with a plan that would better help their diverse workforce and offer meaningful benefits they would use and appreciate. They implemented an LSA with three pillars:

• Treat Yourself: Employees can spend $100 per month on things like fitness, wellness, caregiving, personal development, pet services, and Fresh Funds to purchase groceries. 
• Cell Phone/Internet Reimbursement: Remote employees can spend $60 per month toward cell or internet services. 
• New Hire Home Office Stipend: New employees can spend up to $300 within 90 days of hire on approved office items and connectivity. 

These LSAs are set up to offer employees the thing they really want: choice. “Having the opportunity for multiple wallets has been a real blessing, because it's allowed us to have three different policies for three different uses with its own set of rules.” They’re flexible, creative, and have yielded some pretty amazing results. 

Kate Deeny, senior customer success manager at Forma, shared some numbers:

• Treat Yourself: 97% spent stipend, 97% claim approval rate
• Cell Phone/Internet Reimbursement: 93% spent stipend, 98% claim approval rate
• New Hire Home Office Stipend: 87% spent stipend, 100% claim approval rate

Allowing employees to choose what brings them joy is reflected in the high usage rate of the LSA benefits, says Deeny. “With the kind of confidence and assuredness of how Instacart wanted the setup, and then being able to administer it, I would say that has been, consistently strong throughout the partnership,” she said.

Those are the hard numbers. But what about the other benefits of switching to an LSA?

A huge part of it is showing employees that you care about them enough to make this change and give them more control of their benefits translates to happier employees and even better employee retention, Deeny says. 

On the company side, when a company like Forma manages benefits, it takes a load off human resources. By partnering with a benefits company that offers multiple LSAs, companies like Instacart aren’t tracking various contracts, saving the company admin costs. 

Tips for LSA Implementation

When working to set up LSAs, Deeny says it's important to keep things simple. “We can always pivot, we can always add to it, we can remove,” she said. “But I think to start, it's really just trying to get a sense of, how is this going to be a simple benefit for employees to use and access and take advantage of and be excited about?”

The big question on every company’s mind—how much can we afford to allot in our LSAs? Probably more than you think, Fan says. Forma typically begins a partnership with a client by auditing the existing benefits, zeroing in on if employees are using them. 

“We take a look at how much you’re paying, take a look at the vendors, take a look at what kind of programs you have across the globe,” Fan said. “We take a look at the engagement rate. Chances are there are a lot of 3%, 2%, 1%, 5% out there. What you want to do is to take that money, fold it into an LSA, and make your LSA cover those areas.” The great thing about that, he says, is that there’s no need to ask for a bigger budget. 

For Instacart, the key was making the benefits and amounts meaningful for the employee while keeping it digestible for the company overall. From there, companies can decide whether they’ll institute a reimbursement program or a Forma card to take care of purchases. 

What it all comes down to, are benefits actually benefiting everyone? “We want to offer things that people are using,” Fairbairn said. “We're really proud when we see high utilization.”

Editor’s note: From Day One thanks our partner, Forma, for sponsoring this webinar

Carrie Snider is a Phoenix-based journalist and marketing copywriter.