The inclusive benefits playbook for LGBTQIA+ equity at work

In today’s workplace, diversity without inclusion is incomplete. While LGBTQIA+ legal protections and cultural visibility has advanced in recent years, employee benefits often fall short, unintentionally reinforcing exclusion. For HR leaders, this isn’t just a missed opportunity to foster equity, but also a responsibility to ensure every employee feels seen, supported, and valued.

This guide identifies where employee benefit programs commonly fall short, the structural and cultural barriers to change, and how HR leaders can build a roadmap to better inclusion.

Where LGBTQIA+ exclusion hides in plain sight

Exclusion isn’t always obvious or intended. Often, it’s embedded in default assumptions about gender, family, and who benefits are really designed for.

Examples of common blind spots:

• Defaulting to heteronormative family models: Many benefits still assume a traditional nuclear family. Parental leave policies often refer to “maternity” and “paternity,” while health plans may only cover legally married, opposite-gender spouses.

• Treating LGBTQIA+ benefits as niche add-ons: When benefits for LGBTQIA+ employees are only discussed during Pride Month or covered under separate DEI budgets, they become optional, not foundational.

• Confusing visibility with inclusion: Symbolic gestures like Pride flags in the break room may signal support, but they don’t guarantee safety or belonging. Without policies, benefits, and leadership behaviors to back them up, these signals can feel hollow. That disconnect is real—over 50% of LGBTQIA+ employees report hiding their identities at work, often out of fear of discrimination or bias.

• Reacting to issues rather than planning for them: If your team only updates benefits when someone flags a problem, it erodes employee trust and signals that inclusion is not a priority.

• Tokenizing LGBTQIA+ voices: Expecting one or two employees to speak for an entire community can be alienating and unproductive. Inclusion should be systemic, not delegated.

• Assuming vendors “have it covered”: Carriers may advertise inclusivity but fall short in actual service delivery. Failing to vet third-party providers means you risk perpetuating exclusion.

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Barriers that hold inclusive benefits back

Inclusive benefits are a powerful signal of belonging, but turning intent into action isn’t straightforward. HR leaders often grapple with a tangle of technical, cultural, legal, and financial obstacles that can stall momentum—or worse, reinforce inequity despite the best intentions. Understanding and anticipating these challenges is the first step in crafting solutions that truly stick.

Key challenges HR leaders should prepare for:

Outdated HR systems

Many platforms don’t support nonbinary gender options or diverse relationship statuses. These technical gaps create invisible barriers to access.

Cost concerns and ROI skepticism

Leadership may hesitate to expand benefits due to perceived financial risk, but the data tells a different story. 97% of LGBTQIA+ employees who feel included plan to stay with their employer, compared to just 38% in non-inclusive environments. For a typical Fortune 500 company, even a modest 5% boost in LGBTQIA+ retention can save around $4.2 million annually. Inclusive benefits aren't just the right thing to do—they’re a smart investment in long-term workforce stability.

Legal inconsistencies across states

State-by-state legal differences can make it difficult to create consistent policies nationwide. For example, Washington state offers strong nondiscrimination protections for sexual orientation and gender identity in employment and healthcare. However, states like Mississippi offer no statewide protections, leaving LGBTQIA+ employees more exposed and vulnerable.

To navigate this, some companies default to the minimum legal requirements, but doing so can leave employees in less-protected areas feeling unsupported and imply that inclusion is conditional.

Executive resistance or cultural misalignment

Board members may not be familiar with the needs of LGBTQIA+ employees, so it’s essential for HR to connect inclusion efforts with measurable outcomes like business performance, talent retention, and risk management.

Privacy and trust issues

Employees may avoid using benefits out of fear their identities will be exposed or judged. Without trust, even well-designed benefits programs go underutilized. A 2025 study found that 87% of LGBTQIA+ employees have delayed healthcare in the past two years, with 30% citing fear, anxiety, or embarrassment as the reason.

Enrollment fatigue

Overhauling benefits too often or making processes too complex can backfire. Inclusive benefit designs must also be intuitive and easy to navigate.

6 ways to start building inclusion now:

Even modest updates can send a powerful message and set the tone for deeper reform.

1. Use inclusive language: Swap gendered or heteronormative terms for language that reflects the full spectrum of identities and relationships. This small shift builds trust and signals belonging from the very first interaction. Examples include:
   • Replace “husband/wife” with “partner/spouse”
   • Use “birthing parent” and “non-birthing parent” instead of “mother/father” in parental leave policies
   • Say “employee and their family” instead of “employee and his/her family”
   • Use “they/them” as a default when referring to an unknown individual or in generic templates
   • Avoid terms like “opposite sex” and use “different gender” or “any gender” when discussing eligibility
2. Revamp enrollment systems: Allow employees to self-identify gender, name, and relationship status using flexible formats.
3. Showcase inclusive policies in communications: When promoting open enrollment or onboarding materials, highlight offerings like gender-affirming care or family-forming benefits.
4. Train frontline HR and benefits teams: Equip your people-facing teams with the knowledge and tools to support LGBTQIA+ employees with empathy and accuracy. These team members are often the first point of contact when someone has a question about coverage, leave, or provider access—and their response can either build trust or cause harm. Effective training approaches include:
   • LGBTQIA+ competency workshops led by external DEI consultants or LGBTQIA+ health advocacy organizations like Out & Equal
   • Role-playing exercises for sensitive benefit conversations, like explaining gender-affirming care coverage or handling a deadnaming issue in payroll
   • Inclusive language guides paired with office hours or Q&A sessions to reinforce language that’s supportive of everyone
   • Microlearning modules focused on topics like pronouns, inclusive leave policies, and addressing bias in benefit conversations
5. Invite collaboration with ERGs: Partner with LGBTQIA+ employee groups to identify pain points and work together to create solutions.
6. Vet EAP and mental health providers for competency: Ensure mental health offerings include clinicians trained in LGBTQIA+ care.

Expand benefit offerings in the first 6–12 months

Once foundational changes are in place, it’s time to widen access and improve visibility. Targeted improvements to roll out in the near term:

• Expand family-forming coverage to include adoption, IVF, surrogacy, and legal parenthood pathways, regardless of sexual orientation or marital status.
• Offer gender-affirming care like therapy, hormone treatment, and supportive services including voice training, hair removal, and surgical procedures. Despite the growing need, only 24% of large employers currently report covering gender-affirming hormone therapy in their primary healthcare plan.
• Build a centralized LGBTQIA+ benefits hub that explains what's available and how to access it.
• Create a stipend or reimbursement policy for nontraditional needs, such as legal name changes or affirming clothing purchases.

Strategic moves to consider over the next 1–3 years:

Inclusion can’t just be an initiative—it has to be infrastructure. Short-term actions may spark progress, but lasting impact requires structural change: rethinking systems, policies, and partnerships to weave equity into your Total Rewards strategy. These long-term investments take time, cross-functional alignment, and cultural commitment—but they deliver the deepest returns in trust, retention, and belonging.

Audit your benefits through a fair access and equity lens

To ensure fair access to benefits, organizations should conduct regular equity audits of their benefits programs. These audits can help organizations uncover systemic barriers that may be limiting full participation or access to benefits.

Key actions:

• Collect and analyze data on benefit use across all demographics, including sexual orientation and gender identity.
• Identify gaps in benefit uptake that may indicate underlying inequities.
• Partner with ERGs to gather real insights and pressure-test ideas. Host a quick listening session with your LGBTQIA+ ERG to understand how current benefits land, or share draft language for feedback before rollout. Their input helps surface blind spots and make changes that actually work for employees.

Use vendors with inclusion credentials

Partnering with vendors committed to LGBTQ+ inclusion ensures your benefits are supportive and affirming for all employees.

Key actions:

• Evaluate current vendors for their LGBTQIA+ inclusivity policies and practices.
• Prioritize vendors who’ve received recognition or certifications for their inclusive practices. The Human Rights Campaign Healthcare Equality Index is a great place to start looking for these vendors.
• Incorporate diversity and inclusion criteria into your vendor selection and evaluation processes.

Globalize inclusive standards

For global organizations, it's crucial to establish and uphold inclusive standards across all regions, even where local laws may not provide LGBTQIA+ protections. A study found that while 71 countries prohibit workplace discrimination based on sexual orientation, only 41 countries offer the same protections for gender identity—highlighting just how uneven global protections still are.

Key actions:

• Develop a global inclusion policy with minimum standards for all locations.
• Communicate these standards clearly to all employees, emphasizing your company's commitment to inclusion.
• Provide training and resources for local HR teams to implement inclusive practices effectively.

Integrate LGBTQIA+ inclusion into your Total Rewards philosophy

Building LGBTQIA+ inclusion into your Total Rewards strategy ensures your benefits are more equitable and reflective of your diverse workforce. Research shows inclusive workplaces have higher employee engagement and retention, with 70% of LGBTQIA+ employees more inclined to stay with their employer due to inclusive practices.

Key actions:

• Review and adjust compensation, benefits, and recognition programs to ensure they’re  all inclusive.
• Incorporate feedback from LGBTQIA+ employees to inform Total Rewards decisions and offerings.
• Regularly assess the impact of Total Rewards programs for different employee groups to identify and address any disparities.

Reframe inclusion as a core driver of business and belonging

Inclusive LGBTQIA+ benefits are not about checking boxes, they’re about creating a workplace where all employees, regardless of sexual orientation or gender identity, feel supported, safe, and seen.

When you get this right, the returns are real:

• Increased retention, especially among younger generations like Gen Z
• Higher employee satisfaction and psychological safety

Building an inclusive benefits program doesn’t just meet people where they are, it helps them thrive—boosting productivity, deepening loyalty, and driving long-term business success. And that’s the kind of ROI any organization should be striving for.