Employee benefits are trending this week. Not because things are going well.
Three separate stories about American companies gutting non-wage compensation hit the headlines recently. It makes you want to look away. You don’t want to.
The AI Excuse
Take TTEC. A tech consulting firm based in Texas. Honestly hard to remember the name until they made news this way.
They suspended the discretionary 401k matching for 16,00 employees. Effective immediately. Lasts through at least late 2026.
Internal memos show where the money is going instead. AI certifications. Tools. Automation training. They are building bots. We lose the match.
It is not just TTEC.
Deloitte, the massive auditing giant, is also slashing back. Starting next year for some workers. Paid time off? Down. Parental leave? Halved. The $50k reimbursement for adoption, surrogacy and IVF? Gone.
Zoom adjusted its dial too. Parental leave dropped from 22 weeks down to 18. Specifically for birthing parents. Small change on paper. Big difference in the bank.
So what is driving this? Are more cuts coming? We have no idea.
But blaming “corporate ghouls going AI” feels too simple.
Class Warfare at Home
Joan C. Williams has watched this cycle before. A law professor at UCSF, she writes extensively about workplace power dynamics.
“What Deloitte did is completely unconshonable”
She notes the cuts aren’t even evenly applied. Deloitte is trimming benefits for internal staff in admin, IT and finance. Client-facing roles? Safe. Their perks stay.
For an admin worker parental leave drops from 16 weeks straight down to eight.
It feels arbitrary. Cruel. Williams says when labor markets are tight employers act generous. Power shifts the other way benefits shrink. It is basic leverage.
AI is just a convenient scapegoat.
The Health Care Sinkhole
There is another factor though. Costs. Real, bleeding-edge costs.
Subsidies from the Affordable Care Act expired earlier this year. People started dropping health plans entirely. Insurers raised premiums to compensate.
Sarahjane Sacchetti knows this game well. She used to run top benefits administration companies. Now she builds new healthcare initiatives. She says employer-sponsored health costs have skyrocketed over five years.
Mercer surveyed 1700 US employers last year. The projection? Health costs per worker rise 6.5 percent next year. The highest jump since 2010s. And that includes companies already trying to cut costs.
If they stopped cutting the price hike would be nearly 9 percent.
“This starts to eat into how you view total compensation.”
Sacchetti points out the corporation isn’t necessarily the villain here. American healthcare policy is broken. The safety net is full of holes. Workers feel that stress when they lose coverage.
The Global Outlier
Williams notes something starker.
The United States lacks federal paid parental leave. It shares this distinction only with Papua New Guinea and Surname.
We treat basics like pensions and parental leave as optional corporate gifts. Other industrialized nations view them as rights. Williams argues America needs to join “the rest of the universe” on this one.
There is irony in the current political rhetoric. Politicians talk endlessly about women having fewer babies. Dr. Mehmet Oz called us “underbabied” in the Oval Office last week.
If the goal is more children, a comprehensive federal leave policy is the logical step. Instead Oz called making babies “the most creative thing.”
AI CEOs probably find that inefficient.
Don’t Normalize The Rot
Williams warns against exaggeration. We need nuance.
Zoom moved from “very generous” to just “generous.” 18 weeks is still ahead of the US curve. If we oversimplify every cut as an apocalypse, companies use those outliers as cover for further reductions.
Research backs up keeping benefits.
Walt Cascio famously compared Costco and Sam’s Club. Low pay and poor conditions hurt the bottom line eventually. Williams agrees.
Cutting labor costs blindly often backfires. It damages an organization’s competitive position long-term.
Who Gets the Anger?
Here is the view.
Workers should be furious. Mass layoffs happened. Then corporations used their leverage to strip the lifeblood of employees. They took the benefits away to cap the insult.
But some anger belongs elsewhere.
Look at the government. It failed to provide affordable healthcare. No paid family leave. The social support structure is absent.
When workers rally against the C-Suite they should also ask a harder question. Why aren’t those same CEOs pushing for humane federal policies? Why aren’t they using their massive leverage to fix the broken system?
They are profiting off the rot.
The responsibility sits all the way at the top.
What happens when they finally decide it stops being profitable to care? We wait to see.
