Designing a comprehensive global benefits package that caters to a diverse workforce is a challenge that many companies face. The right mix of global benefits can make a significant difference in building a cohesive, motivated, and satisfied distributed workforce. That’s where a global benefits strategy comes into play.
A well-crafted global employee benefits strategy isn't just a nice-to-have perk; it's a strategic imperative. It aligns with the understanding that employees are more than just cogs in the corporate machine.
The right benefits package will address these differences and demonstrate commitment to your team's well-being. It should also align with your company’s goals, long-term growth and local labour laws.
In this blog post, we’ll explore insights on how you can build the perfect global employment benefits package for your organisation.
What are global employee benefits?
Global employee benefits are part of the additional compensation that a company offers to its team members around the world. So, these benefits are extra perks given on top of their regular paychecks.
Such perks can include healthcare coverage, retirement plans, wellness programs, and even unique benefits like pet insurance.
These benefits are tailored to meet the needs of employees across different countries and also connected with company culture. Most of them are focused on offering peace of mind to employees and promoting work-life balance. They are also customised to local rules and regulations. For example, in Australia, health insurance is a mandatory benefit employers should offer..
Global benefits play an important role in attracting and retaining talent in today’s world, and some might even argue that it’s as important as salary!
Why it's good to have a global employee benefits strategy in place?
Let’s take a look at how a global benefits strategy can help you attract and retain talent in the long run.
1. Attract top talent
Industry-leading pay will only go so far as to retain workers if your benefits package is sub-par.
In a highly competitive job market, you need more than an attractive base salary to attract talented workers. The rapidly changing economy and increasing costs of basic necessities are prompting talent to look for jobs that are more focused on their well-being. Thus, it’s not surprising that 80% of employees would choose additional benefits over a pay raise.
A comprehensive global employee benefits strategy signals to potential hires that your organisation is committed to their long-term financial security, health, and work-life balance, making your company a top choice in the talent pool.
With proper planning, you will know the preferred benefits of workers and this will lead to a smoother recruiting process and also encourage employee loyalty.
2. Increase job satisfaction and employee retention rates
When employers show that they care about employees through benefit programs, it makes a world of difference. It will lead to happier, healthier, and more engaged employees.
Also, it's a proven way of keeping talent loyal. According to MetLife, 82% of employees rate care programs and benefits as one of the top reasons to stay in their current jobs. If the Great Resignation taught us anything, it should be that competitive benefits are key to retaining your A-team. We all know that the cost of finding new employees is much higher than retaining your existing team.
So, nurturing job satisfaction and enhancing employee retention should be priorities for organisations aiming to thrive in a competitive job market. Comprehensive benefit programs not only contribute to happier and healthier employees but also serve as a powerful retention strategy.
3. Improve productivity
Many employers believe that the benefits package they offer drives a positive impact on their teams’ productivity.
In a survey, 83% of employers believe that employee benefits can make or break their employee engagement strategy. When the things that matter to them the most are taken care of, employees are less stressed and can manage work better. The result? More engaged and satisfied employees with high morale which leads to better work quality. They show up consistently, ready to give their best.
Satisfied employees become your biggest cheerleaders, both in the office and outside, building your brand reputation. That’s a win-win situation for everyone.
4. Ensure benefits compliance
Every country has certain laws that tell employers to offer specific benefits to their workers. These are called "statutory benefits." For example, in some European countries, workers who lose their jobs may be entitled to unemployment benefits for a certain period.
If you fail to comply with such laws, you’ll have to face lots of complications—you could get hit with fines, tangled up in legal fees, and even damage your reputation.
Having a solid global benefits plan will help you align with the labour laws of all the countries your employees are from because it ensures that your organisation provides the mandated benefits, entitlements, and protections required by each jurisdiction.
5. Support diverse workforces
It's crucial to offer a global benefits package that caters to the unique needs and preferences of your employees from various backgrounds. A diverse workforce brings together people with skills and experiences, which makes the team more dynamic and adaptable.
Offering flexible work hours, cultural and religious holidays, healthcare packages, childcare services, elder care assistance, adaptive technologies or even language classes can attract a diverse talent pool. In addition, you can promote employee resource groups and offer diversity training to support your employees.
When employees feel that their needs are met and their contributions valued, they are more likely to stay with your company long-term. This stability can reduce turnover rates, recruitment costs, and the loss of institutional knowledge.
Examples of global employee benefits
Let’s look at two categories of global employee benefits into two main groups: mandatory benefits and supplementary benefits.
Mandatory benefits include those that are specified by law and they are mostly focused on the basic needs of employees. These should be a primary aspect of your global employee benefits strategy as they help you remain compliant with local laws.
Although they may differ at the regional or local level within a country, here are some common examples of mandatory benefits:
- Insurance coverage: In many European countries, employers are required to provide health insurance. Some employers go a step further by offering private healthcare. Employers may also be obligated to provide insurance coverage for workplace accidents and occupational diseases.
- Retirement plans: Employers in Europe may be required to contribute to private or state-sponsored pension plans on behalf of their employees.
- Paid-time off: Typically, employees are entitled to a minimum number of paid vacation days, which vary by country.
- Parental leave: Most European countries offer shared parental leave or additional leave for parents to care for their children.
- Minimum wage: Several European countries have established statutory minimum wage levels that employers must adhere to.
Supplementary benefits, also known as voluntary benefits or fringe benefits, are additional perks companies offer employees beyond the legally mandated benefits. These benefits are what make your global benefits plan more attractive and competitive. They can be tailored to meet the specific needs and preferences of their workforce.
Here are some popular supplementary benefits:
- Flexible working hours: Flexible work arrangements can include options like flextime, compressed workweeks, or the ability to adjust start and end times to accommodate employees' needs.
- 4-Day work week: In some European countries, there is a growing interest in offering a four-day workweek to promote work-life balance and employee well-being.
- Skill development: Employers may invest in employees' skill development through training programs, workshops, or tuition assistance for further education.
- Cancer insurance: Some employers offer cancer insurance as an additional coverage to help employees cope with the costs associated with cancer treatment.
- Pet insurance: Pet insurance benefits are becoming more common, allowing employees to access veterinary care for their pets.
- Emergency fund: Employers may contribute to an emergency fund or offer financial assistance during unforeseen emergencies, such as natural disasters or personal crises.
- Unemployment insurance: In certain cases, employers may provide supplementary unemployment insurance to help employees during periods of job loss.
- Retirement funds: Supplementary retirement funds, like additional pension contributions or retirement savings plans, can help employees enhance their long-term financial security.
- Wellness benefits: Wellness benefits may include coupons or subsidies for gym memberships, wellness programs, or health-related activities.
- Transportation allowance: Some employers offer transportation allowances to assist employees with commuting expenses.
Global employee benefits vary by company and region, but a well-balanced package often includes a mix of mandatory and supplementary benefits to meet the diverse needs and expectations of a global workforce.
A survey by Aon shows what employees expect from companies in terms of benefits:
Global Employee Benefits: Trends and statistics
Let’s look at a few trends and statistics that will help you determine the right global benefits roadmap for your company:
- One in 10 workers would take a pay cut if they get access to better benefits. This points to how important offering the right benefits is. (Forbes)
- 51% of respondents said flexible hours are a major concern of office life. This reflects on how more people want companies to be more inclusive of various lifestyles and prioritise work-life balance. (Forbes)
- More than 30% of 18–41-year-olds are most concerned with having pet insurance available as a perk. (Forbes)
- Offering career development and skill enhancement in benefits packages improved the retention rate of millennial employees by 85%. Workers are prioritising skill development as a benefit. (Getbridge)
- 61% of candidates evaluate the opportunity to balance work and life when considering a job offer. This shows that having benefits that promote work-life balance is important in your global benefits package. (Stelfox)
- Most Gen Z (91%) and Millennial (85%) employees think all companies should have a mental health work policy in place as part of their benefits package. (Zapier)
- 65% of employees who feel cared for are more likely to be loyal. (Metlife)
How to create a global employee benefits package?
Here are a few steps to help you determine the right mix of benefits for your distributed workforce.
1. Define budget
Determine how much your organisation can allocate to employee benefits. You will also need to consider how many employees you will be hiring in the coming years. Forecasting your hiring can help you determine how much money per employee you can set aside for the benefits.
Next, research the countries you want to hire from. Find out the costs of hiring for specific roles from industry reports. In countries where you don’t have a presence, you can consider taking the help of a staffing agency or an experienced employer of record (EOR) like Teamed. This removes the need to set up a legal entity in that country and navigate complex compliances and labour laws.
You can use this free employment cost calculator by Teamed to compare the employment costs of different countries.
2. Understand government laws
Research and understand the labour laws and regulations in each country where you have employees. Different countries have varying requirements for mandatory benefits, such as health insurance or retirement plans. For example, countries like South Africa require employers to mandatorily contribute to the Workers' Compensation Fund.
You will need to know such critical details before planning and budgeting for a global benefits package. Understanding and complying with such laws from multiple countries can be challenging. An EOR like Teamed can help you by taking on the legal responsibilities of an employer, which includes compliance with local labour laws and regulations.
3. Conduct a competitor analysis
Take a look at what your competitors are providing, both around the world and in your specific regions. This sneak peek helps you understand what's considered the norm in your industry and what goodies employees really appreciate.
Platforms like LinkedIn, Glassdoor, and other job portals can be your starting point. And don't forget to check out industry trends and reports.
4. Prioritise the benefits you want to offer
Thoroughly learn about the labour markets you’re targeting—what workers expect, what governments require, and what competitors offer.
Here are a few factors to consider when deciding which benefits to include in your package:
- Current employees’ satisfaction regarding their benefits package and their opinion on it.
- Are you trying to be more cost-effective?
- Cultural requirements—For example, in countries where preventive healthcare is a cultural norm, providing regular health check-ups or wellness programs may be highly valued.
Now you can start building your global employee benefits package:
Mandatory benefits: benefits required by local laws, such as health insurance and retirement plans
Core supplementary benefits: universally valued benefits, such as paid time off, flexible work schedules, and wellness programs
Tailored supplementary benefits: offerings like transportation allowances, childcare support, or supplementary healthcare programs
Communication and education: informational workshops, online guides, consultations with experts, and user-friendly benefits portals
The key to a cohesive global employee benefits strategy is to coordinate the links between different elements. This will help align the benefits package with organisational goals and satisfy the diverse needs of the workforce.