Brian Hegarty Shares Insights on Employee Benefits & Effective HR Practices

This Employee Benefits & Effective HR Practices “Conversation with the Expert” section is produced by the LA Times Studios team in conjunction with Marsh McLennan Agency.

Businesses have been navigating through a continuously altering and evolving employee benefits landscape. New technological advancements, shifting legislation and workforce shortages in many industries have led to a new set of expectations, protocols and best practices when it comes to businesses determining the right benefits packages and HR practices for their employees. What should C-suiters and HR leaders be focusing on in terms of new standards?

To answer that and other questions while taking a closer look at the latest developing trends in the business of employee benefits and HR best practices, we have turned to one of the region’s leading authorities, Brian Hegarty of Marsh McLennan Agency, who graciously weighed in for a discussion and shared insights.

Q: Are there any new legislative, compliance or regulatory issues trends that HR professionals should be aware of in 2026?

In 2026, compliance is becoming more dynamic and more localized. Employers, especially in states like California, are navigating expanding pay transparency laws, evolving leave mandates and increased scrutiny around fiduciary responsibility in benefits administration. At the same time, AI is introducing a new layer of regulatory complexity, particularly around bias, data privacy and auditability. What has changed is the pace. Regulations are no longer static, and multistate employers must continuously adapt policies in real time. Leading organizations are investing in stronger governance frameworks and cross-functional alignment between HR, legal and finance to stay ahead of risk while maintaining a positive employee experience.

Q: How should organizations balance cost control with offering attractive, modern benefits packages?

This is the defining tension for employers right now. Healthcare costs are projected to rise at near double-digit levels in many markets, forcing organizations to rethink traditional plan design. The most effective approach is not simply reducing benefits, it is redesigning them. Employers are leveraging data, alternative funding strategies and targeted programs like high-cost claimant management and pharmacy optimization to control spend. At the same time, they are prioritizing benefits employees truly value, such as mental health, flexibility and financial wellness. The key is shifting from a more-versus-less mindset to a better-versus-inefficient one, delivering smarter, more personalized benefits that drive both engagement and long-term cost sustainability.

Q: How are employers expanding mental health support, and what approaches are proving most effective?

Mental health has moved from a supplemental benefit to a core business priority. Today, leading employers are shifting away from fragmented solutions toward integrated, end-to-end support models that combine clinical care, digital tools and proactive outreach. What is proving most effective is a focus on measurable outcomes, not just access. Employers are prioritizing continuous care models, embedding mental health into leave and disability strategies, and using data to identify at-risk populations earlier. We are also seeing a cultural shift where leadership engagement and manager training play a critical role. When mental health is supported both structurally and culturally, organizations see improvements not only in well-being but also in productivity and retention.

Q: How is AI changing benefits administration and HR decision-making?

AI is rapidly transforming how benefits are designed, delivered and managed. Today, many organizations are using AI to automate administrative tasks, personalize benefit recommendations and analyze claims and engagement data in real time. What is most impactful is AI’s ability to uncover insights that were previously difficult to detect, whether it is identifying rising cost drivers, predicting absenteeism trends or improving employee navigation of benefits. That said, AI works best as an enhancer, not a replacement. The most successful organizations are pairing advanced analytics with human expertise to create a more intuitive, supportive employee experience while improving efficiency across HR functions.

Q: What are the legal risks associated with using AI in hiring, performance management or benefits allocation?

AI introduces meaningful opportunity but also real legal exposure. The biggest risks center around bias, transparency and data privacy. If AI tools are trained on flawed or incomplete data, they can unintentionally reinforce disparities in hiring, promotion or access to benefits. Regulators are increasingly focused on ensuring that AI-driven decisions are explainable and auditable. Employers must be able to demonstrate how decisions are made and validate that outcomes are equitable. In practice, this means implementing strong governance, conducting regular audits and maintaining human oversight. Organizations that treat AI as a black box risk both compliance issues and erosion of employee trust.

Q: How are organizations tailoring benefits to meet the needs of multigenerational workforces?

The workforce today spans four generations, and expectations around benefits have never been more diverse. A one-size-fits-all approach no longer works. Employers are increasingly moving toward more flexible and personalized benefit structures, offering options that address different life stages, from student loan support and career development to caregiving benefits and retirement readiness. Technology is playing a key role here, enabling employees to choose and engage with benefits in ways that are most relevant to them. The organizations that stand out are those that recognize benefits as part of the overall employee experience, meeting individuals where they are while maintaining a cohesive and equitable strategy across the workforce.

Q: What are the most common mistakes companies make when designing or updating their benefits programs and how can they avoid them?

One of the most common mistakes is adding programs without a clear strategy. Many organizations layer on new benefits over time, creating complexity, redundancy and low engagement. Another challenge is focusing too heavily on cost or benchmarking without understanding what employees actually value. This often leads to underutilized programs and missed opportunities for impact. The most effective organizations take a more intentional approach, aligning benefits with workforce needs, using data to guide decisions and regularly evaluating outcomes. Simplification, integration and communication are critical. Ultimately, the goal is not just to offer more benefits; it is to deliver a cohesive experience that employees understand, use and value.