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Did you know? 80% of global workers prioritize a better benefits package while choosing a job offer. Benefits are incentives and rewards offered to employees in addition to their financial compensation. Offering benefits does not just attract talent but also creates a workplace where employees feel valued and supported.
For companies looking to hire international employees, crafting robust benefits packages is the key to attracting and retaining top talent worldwide. However, a one-size-fits-all approach won’t work because each country has labor laws and regulations. So, how do companies navigate the complex terrain of offering global benefits packages?
Read on to learn why global employee benefits are pivotal and how to offer benefits packages in compliance with diverse local laws.
Why is it important to invest in a strong benefits program?
Employee benefits are as important as salary for your global employees. They are not just perks but a powerful way to show commitment to your employee’s personal and financial well-being. For companies eyeing global expansion, a global benefits strategy can also enhance their reputation and brand image in the international market. Here are more insights on the need to offer global employee benefits:
- Attracts top talent: The global talent war, fueled by the pandemic and remote work, has heightened competition among companies. Offering competitive salaries and diverse employee benefits attracts talent and enhances a company's international image. To succeed in the international job market, aligning benefits with evolving workforce needs is crucial. Reports show that 69% of employees prioritize better benefits, emphasizing the importance of a comprehensive and progressive benefits package to outshine competitors.
- Boosts employee retention and lower turnover rates: Offering comprehensive benefits is important for employee retention. In fact, in one study, 75% of the people said they were more likely to stay with their current company because of their employee benefits package. Employees who feel valued and fairly compensated for their work are likelier to be loyal and prefer staying long-term at their workplace.
- Improves productivity: An employee's productivity is very much related to his/her physical and mental health. It determines their performance, number of leaves taken, and chances of a turnover. With the right benefits plans, you can help your employees achieve better physical and mental health and work-life balance. All of this improves the mental state of the employees, resulting in them taking fewer days off and working more productively.
- Mitigates Legal Risks: A comprehensive benefits package ensures compliance with diverse labor laws and regulations across different countries. A meticulously designed benefits program aligns with local regulations, addressing issues related to wages, working hours, leave policies, and employee rights. Failure to comply with local labor laws can result in potential legal disputes, fines, or reputation damage. Additionally, staying informed about legislative changes and proactively updating benefits packages helps maintain legal compliance amidst evolving labor laws.
Types of Global Employee Benefits
Global benefits come under two categories, as given below.
Statutory benefits are government-mandated benefits that an employer must provide to their employees. Every country has its regulations mandating certain statutory benefits that employers must give their full-time employees. German employees are entitled to at least a minimum of 20 paid days off and 6 weeks of sick leaves in a year at 100% of their salary, while in the UK employees are entitled to at least 28 paid annual leaves and Statutory sick pay until 28 weeks.
These are extended benefits covering employees and their families. Companies voluntarily offer these perks to attract and retain employees. Some popular supplementary benefits include dental insurance, vision plans, life insurance, and gym memberships.
Examples of Global Employee Benefits
Here are some of the popular benefits offered across companies:
- Wellness Benefits: Wellness benefits like gym memberships, mental health sessions, de-stressing sessions, and yoga classes prioritize employees’ physical and mental well-being. It leads to greater employee engagement and more productivity.
- Health Insurance: Health insurance offers a safety net for employees, giving access to necessary medical care without the burden of exorbitant expenses. Companies can offer various plans to accommodate diverse needs. This coverage helps employees access medical care, ensuring they can address health concerns without financial strain.
- Dental insurance: The cost of dental care varies according to the country. It covers dental procedures like routine check-ups, cleanings, and more extensive procedures, alleviating financial barriers to dental care.
- Vision plans: These plans help employees maintain and improve their vision and eye health. They include coverage for annual eye exams, glasses frames, and lenses, and other vision-related services.
- Life insurance: Life insurance offers support and security during challenging times to the employees’ family in case of an employee's natural or accidental death. It offers financial security in their personal and professional life.
- Retirement benefits: Retirement benefits such as pension plans give financial security to employees after retirement. They ensure a stable and comfortable future for them and foster long-term loyalty to the company.
- Paid time off: Paid time off or annual vacation refers to paid vacation time given to employees, and it is one of the most valuable and attractive employee benefits. It allows employees to take a break from their routine work and avoid burnout. Taking time off makes them bounce back with even higher energy, increasing their productivity. Companies must provide a certain number of days as PTO to all full-time employees. However, the number of days varies depending on the country's employment law. The United States doesn't have a mandatory law for employers to pay their employees during time off, while the UK gives 28 days of paid annual leave.
- Paternity and Maternity Leave: More than 120 countries provide paid maternity leave. Global companies increasingly understand the significance of maternity leave in fostering work-life balance. Paternity and Maternity leave policies vary worldwide, but the trend is toward more generous and inclusive benefits. Offering paid time off for new parents, giving them time to care for their newborns, supports the well-being of employees. This gender diversity initiative contributes to a family-friendly workplace culture.
- Learning and Development Benefits: Incorporating learning and development perks like access to online courses, workshops, conferences, and certifications empowers the workforce to acquire new skills and stay updated on the overall trends. This enhances their overall professional growth. These perks benefit individual employees and contribute to the company's success by fostering expertise within the team.
- WFH Stipend: Many companies give WFH stipends to alleviate the financial burden of employees setting up a productive home office. Employees can use these funds for furniture and high-speed internet to create a productive environment. This acknowledges the changing dynamics of the modern workforce and contributes to employee satisfaction. During the pandemic, Shopify gave $1000 to their team members to buy everything they needed to set up a comfortable and efficient remote workspace.
Current Trends in Global Employee Benefits
Employee benefits should not be static but responsive to your global workforce's changing needs and preferences. Here are some global employee benefits trends you should note.
Rising healthcare costs
Healthcare expenses have surged globally, especially post-pandemic, causing unprecedented financial strain. A recent trend is that employees expect companies to provide comprehensive family and health benefits. According to a report by Maven Clinic, 87% of people say that family benefits, like maternity, parenting, and pediatrics, are important to both prospective and current employees. Companies can provide comprehensive global employee benefit plans with lower deductibles and supplemental benefits options with diverse coverage options.
Benefits plan with greater flexibility
Offering flexible benefits plans will elevate your company’s competitiveness in attracting top talents. With many organizations offering similar benefit programs, it is vital to embed flexibility in your strategy to stand out from the rest. Unlike rigid employee benefits, personalized benefits cater to the employees based on their specific needs. Some companies in countries like Spain and the UK offer a 4-day work week which gives a healthier work-life balance. In 2015, LinkedIn shifted to providing unlimited holidays to give their employees more flexibility and a sense of empowerment. Offering flexibility in the benefits plan will also benefit the companies, where they can see an increased uptake rate and improved ROI.
Emphasis on health and wellness
Work stress, burnout, and a hectic environment hurt employees’ productivity and motivation. The focus on health and wellness extends beyond traditional medical benefits, encompassing holistic approaches that address the various facets of an individual's well-being. Flexible work arrangements, mindfulness programs, and initiatives promoting a healthy work-life balance are gaining prominence. This not only focuses on employee’s well-being but also contributes to the organizational success. Companies that prioritize health and wellness programs are not only contributing to a healthier workforce but are also likely to experience a positive impact on employee morale, talent attraction, and retention.
Role of an EOR in Offering Global Employee Benefits
Administering global benefits programs in-house can be complicated, requiring HR teams to navigate various legal requirements or work with international vendors to ensure compliance with local rules and customs. So, how do you make it work effectively?
An EOR can help you administer and handle the whole process of offering global employee benefits.
- Streamlined administration: EOR providers manage administrative tasks related to benefits, relieving companies of the burden of navigating varying systems and procedures in different countries.
- Legal compliance: An EOR ensures compliance with diverse international laws and standards, mitigating legal risks or disputes on non-compliance.
- Cost-effectiveness: An EOR enables companies to offer standardized benefits across regions, maintaining a consistent employee experience and ensuring fairness in compensation and perks. This can help companies achieve cost efficiencies through economies of scale, negotiating favorable terms for employee benefits on a global scale.
Why choose Gloroots as your EOR?
Gloroots offers a comprehensive, compliant, competitive management solution for your global benefits package. We consider your company‘s values, budget, and long-term business goals and suggest packages that fulfill your unique business needs and benefit your employees.
- Comprehensive benefits coverage: Gloroots covers a comprehensive range of global employee benefits plans that are market-competitive. From life insurance to private health care, mental wellness, and gym plans, we offer a comprehensive benefits package that is suitable and cost-effective for your business. Country-specific plans or standard coverage, Gloroots can help you with both.
- Local expertise: Gloroots has an in-depth understanding of labor laws, tax regulations, and employment standards in different countries. We ensure that the benefits are compliant with the local laws and regulations of the respective countries where you hire employees. We are constantly updated on regulation changes and guarantee compliance.
- End-to-end expert support: Don't research benefit requirements or vendors in every country. Our expert team has done it all for you. We have curated plans for every country, and we can help you with personalized support and advice on choosing the right benefit package according to the country. With round-the-clock support, we take care of every step of benefits administration, from enrollment to offboarding.
Give your team the best! Don’t let the complexity of administration hinder you from diving into the market. Gloroots handles it all. Click here to get started.