Global Employee Benefits: Importance in Today's Workplace
In today's globalized and competitive world, attracting and retaining top talent is a key challenge for many businesses. Employees are not only looking for a fair salary but also for a comprehensive and attractive benefits package that meets their needs and expectations.
In this blog post, we will explore what global employee benefits are, what types of benefits are most desired by employees around the world, why they are important for both employers and employees and what best practices you can follow to implement a successful global benefits strategy.
What are Employee Benefits?
Global employee benefits are the non-wage compensation given to a distributed workforce in addition to their net income, and they include a variety of things including health insurance plans, retirement plans, wellness programs, and more.
These benefits have been specifically designed to fulfill the requirements of workers in various nations. They are essential in attracting and retaining talent, promoting employee well-being and loyalty, and ensuring compliance with local regulations in the international work environment.
Global employee benefits can be divided into two categories:
- Statutory Supplemental
Statutory employee benefits are those that are required by local laws and regulations in each country where you operate.
For examples are:
- Social Security Contributions
- Health Insurance
- Unemployment Insurance
- Workers' Compensation
- Maternity Leave,
- Sick Leave
Statutory benefits vary widely from country to country and may change over time due to political and economic factors. Therefore, it is crucial to stay updated on the latest legal requirements and comply with them to avoid penalties and fines.
- Supplemental
Supplemental employee benefits are those that are not mandated by law but are offered by employers as an additional perk to attract and retain talent.
Some examples are:
- Paid time off (PTO)
- Parental Leave
- Education Benefits
- Wellness Programs
- Discounts
- Recoginition Programs
- Flexible Work Arrangement
Supplemental benefits depend on what an employer is ready to offer and what employees value most. They can also be used to differentiate your employer brand from your competitors and create a consistent employee experience across your global workforce.
Types of Global Employee Benefits
As we have seen, there are many types of global employee benefits that can be offered to employees in different countries. However, some of them are more popular and desired than others.
Some of the most sought-after employee benefits globally are:
-
Healthcare
Healthcare is the most common benefit employers offer, covering everything from routine doctor’s appointments and prescription drug costs to hospital visits, major surgeries, and more. Healthcare is also one of the most valued benefits by employees worldwide.
According to a survey done by McKinsey and Company, it found that especially after the Covid-19 pandemic, such benefits are very important to them. However, healthcare costs and coverage vary significantly from country to country. Therefore, it is important to offer localized healthcare plans that meet the specific needs and expectations of employees in each market.
-
Retirement Plans
Retirement plans are another type of global employee benefit that can help you attract and retain talent, especially in countries where the state pension system is inadequate or uncertain. Retirement plans are savings schemes that allow employees to set aside a portion of their income for their future retirement, often with tax advantages and employer contributions.
There are different types of retirement plans available in different countries, such as 401(k) plans in the US, Superannuation Funds in Australia, Provident Funds in India, and Pension Funds in many European countries. Some of these plans are mandatory, while others are voluntary or supplementary.
Depending on the local regulations and market practices, you may need to offer a retirement plan to your employees or match their contributions up to a certain percentage.
Retirement plans can benefit both employees and employers in several ways. For employees, they provide a source of income security and financial stability in their old age, as well as an incentive to save more and invest wisely.
For employers, they can enhance employee loyalty and satisfaction, reduce turnover costs, and improve the company's reputation and social responsibility.
-
Wellness Programs
Wellness programs are initiatives that aim to improve the physical and mental health of employees through various activities, resources, and incentives. Wellness programs can cover a wide range of topics, such as nutrition, fitness, stress management, mental health, smoking cessation, substance abuse prevention, and more.
Wellness programs can have positive impacts on both employees and employers.
For employees, they can help them adopt healthier lifestyles, prevent chronic diseases, cope with stress, boost their mood and energy levels, and increase their self-esteem and confidence.
For employers, they can lower healthcare costs, reduce absenteeism and presenteeism, enhance productivity and performance, and foster a positive and supportive work culture.
Some examples of wellness programs that you can offer to your global employees are:
- Online fitness classes or gym memberships
- Health screenings and assessments
- Health coaching or counseling services
- Wellness challenges or competitions
- Wellness rewards or recognition
Importance of Global Employee Benefits
Global employee benefits are not only a legal obligation but also a strategic advantage for international employers. By offering competitive and compliant global benefits packages to your employees, you can achieve several important goals:
-
Talent Attraction and Retention
One of the main reasons to offer global employee benefits is to attract and retain top talent in the global market. According to a survey by Willis Towers Watson, 75% of employees say that benefits are a key factor in their decision to join or stay with an employer. Moreover, 72% of employees say that benefits make them feel valued by their employer.
By offering global employee benefits that meet or exceed local standards and expectations, you can show your employees that you care about their well-being and happiness. You can also differentiate yourself from your competitors and create a strong employer brand that appeals to potential candidates.
-
Enhanced Company Culture
Another reason to offer global employee benefits is to enhance your company culture and values. By providing benefits that align with your mission and vision, you can communicate what matters to you as an organization and what kind of behavior you want to encourage among your employees.
For example, if you value innovation and creativity, you can offer benefits that support learning and development, such as tuition reimbursement or online courses. If you value diversity and inclusion, you can provide benefits that cater to the needs of different groups of employees, such as flexible work arrangements or parental leave.
By offering global employee benefits that reflect your company culture and values, you can foster a sense of belonging and engagement among your employees. You can also attract talent that shares your vision and values and contributes to your success.
Best Practices for Implementing Global Employee Benefits
Implementing global employee benefits can be challenging due to the complexity and diversity of local regulations, cultures, and preferences.
However, there are some best practices that can help you design and deliver effective global benefits packages for your employees:
- Conduct a global benefits audit: Before offering any benefits to your employees, you should conduct a thorough audit of the existing benefits landscape in each country where you operate. You should identify the statutory requirements, market benchmarks, employee expectations, and cost implications of each benefit option.
- Localize your benefits offerings: After conducting a global benefits audit, you should localize your benefits offerings to suit the needs of each country or region. You should consider the legal compliance, cultural relevance, tax efficiency, and administrative feasibility of each benefit option.
- Communicate your benefits clearly: Once you have localized your benefits offerings, you should communicate them clearly to your employees. You should explain the value proposition, eligibility criteria, enrollment process, coverage details, and claim procedures of each benefit option.
You should also use multiple channels and formats, such as emails, brochures, webinars, or videos, to reach your employees effectively.
- Evaluate your benefits regularly: Finally, you should evaluate your benefits regularly to measure their impact and effectiveness. You should collect feedback from your employees, analyze data on benefits utilization and satisfaction, and benchmark your benefits against your competitors.
In a Nutshell: Global Employee Benefits
Global employee benefits are essential to a global compensation package that can help you attract and retain talent, promote employee well-being and loyalty, and ensure compliance with local regulations in the international work environment.
However, offering global employee benefits can be challenging due to the complexity and diversity of local regulations, cultures, and preferences. Therefore, you should follow some best practices to design and deliver effective global benefits packages for your employees, such as conducting a global benefits audit, localizing your benefits offerings, communicating your benefits clearly, and evaluating your benefits regularly.
Aniday wishes the best for your company and hopes you will sustain a competitive edge in whichever industry you are in.
References
https://www.irs.gov/retirement-plans/401k-plans
https://www.ecb.europa.eu/stats/financial_corporations/pension_funds/html/index.en.html
