2026 Employee Benefits Market Outlook 4 Shifting to employee leave, more states are enacting new paid sick leave (PSL) and paid family and medical leave (PFML) programs, as well as amending existing laws. This expansion includes broadening the rea-sons for leave (i.e., bereavement, miscarriage, prenatal care and public health emergencies) and adjusting the definition of family member to include relatives like siblings or even a designated person like a friend or neighbor. While employee leave activity is quieter on the federal level, courts are increasingly ruling that the Uniformed Services Employment and Reemployment Rights Act (USERRA) requires employers to provide paid leave for military service if they compensate employees for comparable types of leave. Furthermore, artificial intelligence (AI) is rapidly trans- forming the workplace, fundamentally altering job roles and employee benefits administration. With reports showing that employers are set to replace some roles with AI, workers are increasingly concerned about lay- offs and how technology could displace or change their roles. AI enables organizations to analyze employee data and create personalized benefits programs, which can lead to higher overall utilization rates. Similarly, AI is being used in wellness programs to give people more personalized support. These tools tailor rec- ommendations to each person and can even spot early signs of burnout or disengagement before they become bigger problems. The trends shaping the employee benefits market signal a period of significant transformation. Legislative and regulatory developments, rising health care costs, evolving employee expectations and rapid technolog- ical advancements will require employers to be agile and proactive. By leveraging this Market Outlook as a strategic guide, organizations can anticipate challenges, identify opportunities, and position their benefits pro- grams to remain compliant and competitive in an increasingly challenging environment.