The challenges of providing the right employee benefits globally
Business expansion can be exciting, but it doesn’t come without a number of risks and considerations. For example, if your company is based in the UK but has expanded globally, you may be required – either by law or common practice - to provide certain employee benefits in these new locations. We have a dedicated global employee benefits team, that can use their local knowledge to help you understand and navigate local employee benefits laws and best practices; allowing you to offer the best to your people.
In this article, we discuss the challenges of providing the right benefits globally and why it’s so important to have a partner like NFP. The topics we cover, are:
- What are employee benefits?
- Why do benefits differ around the globe?
- Why invest in your global employee benefits offering?
- What were the top global employee benefits trends of 2022?
- Why choose NFP?
1. What are employee benefits?
Employee benefits are exactly what the name suggests, they are benefits that you offer to your employees – be that because of a legal obligation or as an added incentive – while they are working for your business. Some of the most common global benefits include:
- Pensions and retirement assistance
- Insured plans (e.g life insurance, dental and medical plans)
- Leave (e.g holidays, sick pay and parental allowances)
- Prerequisites and allowances (ranges from car allowances to lunch vouchers and employee assistance programmes)
For a business, evaluating which benefits will be of value to your people and deciding which ones to offer, can be difficult enough in your country of origin, let alone in a completely new location.
2. Why do benefits differ around the globe?
There are two main factors that commonly influence the benefits offered from country to country, namely:
Culture
Cultural factors are differences in societal norms, attitudes and behaviours that affect which benefits may be of value to people from different parts of the world. Countries like India, for example, are perceived as being ‘collectivist’; meaning that their culture is based on strong family values. As a result, medical insurance in these countries usually also covers the parents and/or parents-in-law of the employee, as well as the employee themselves. NFP can help your business to align your benefits with these cultural expectations.
Legislation
Legislative factors relate to any differences in the law that will affect which benefits businesses must offer – and how they must offer them - as a legal obligation. When quotations are obtained, they will contain both the minimum requirement of benefits that must be provided, as well as the market practice level of benefits offered within the relevant location(s). Whilst the minimum will ensure that your business is compliant with the law, not offering at least the level of market practice will likely leave you with a weaker ability to attract and retain the best people.
3. Why invest in your global employee benefits offering?
Firstly, there are the Collective Bargaining Agreements (CBAs), which will dictate the minimum level of benefits that need to be provided in each country. It’s important to be informed of these requirements (as well as stay informed of any updates). NFP can help to take the hassle out of doing this.
In some countries (Singapore for example) the unemployment rate is very low, which allows people to be more selective about the companies they work for. Offering benefits that match or surpass that of your competitors can attract the best talent that these markets have to offer. As well as focussing on new personnel, you may also have people that you have invested time, effort and money into training. Retaining these people means that you reap the benefits of the resources you have invested into their development and is just as important for your business as attracting new talent.
Workplace satisfaction has been proven to lead to better performance and productivity (World Economic Forum - Happy Employees are More Productive, Research Shows | World Economic Forum and, whilst there are many other important factors that foster workplace satisfaction, offering employee benefits that are of value to your people and their daily lives, could be a good way to maintain this. The goal is to make your people feel valued as an individual – not just as a cog in the machine.
"whilst there are many other important factors that foster workplace satisfaction, offering employee benefits that are of value to your people and their daily lives, could be a good way to maintain this. The goal is to make your people feel valued as an individual – not just as a cog in the machine."
Matthew Shaw, International Employee Benefits Consultant
4. What were the top global employee benefits trends in 2022?
One of the main global employee benefits trends we saw in 2022 was a shift towards offering corporate wellness to employees; supporting people to alleviate pressures in their personal lives to help increase employee happiness, which has been linked to a greater likelihood of people staying with your business (Forbes, 2022 The Rise Of Corporate Wellness To Support Employee Retention). For example, businesses in some countries are offering a crèche service within their benefits packages, to provide assistance for new parents with childcare arrangements. This can offer a solution to people that may otherwise be considering leaving employment (e.g. to look after young children), therefore potentially encouraging talent to stay within your business.
Businesses across the world seem to collectively be investing in the wellness and mental health of their people, which is a positive trend to see (Forbes, 2022Â The Rise Of Corporate Wellness To Support Employee Retention).
5. Why choose NFP to help you with your global benefits strategy?
Experience
We support the global aspect of your company and understand the cultural differences and complexities from country to country. Our global benefits team work closely with local brokers to ensure that they stay fully updated and informed as soon as any new solutions come to the market, as well as any changes that occur within the market that may impact you.
Single point of contact
If your business is operating in a number of countries, you don’t want that to multiply your points of contact – liaising with multiple account managers, multiple brokers and multiple insurers for multiple markets can be confusing. We will act as your central point of call, meaning all communication will go through us, no matter which market it relates to.
Holistic approach
We look at your entire global strategy and help to ensure that your benefits are aligned from country to country. Our global benefits consultants are supported by local brokers to make sure that the benefits plans are not only compliant legally, but are the most appropriate to compete in the relevant market(s).
Author
Matthew Shaw, International Employee Benefits Consultant
matthew.shaw@nfp.com
NFP can help you build a global employee benefits strategy and make your business' overseas expansion as seamless as possible. To find out more about how we can help you best support your people and your business, visit: nfpireland.ie/global