Is your employee benefits package working for your business?
Late last year, Marketwired reported on the turnover rates for Thai businesses as part of an article on Aon Hewitt’s Total Compensation Measurement Study and Benefits Survey 2016. What’s interesting to note about that is it gives some really useful insight into what an employee benefits package can do to boost your staff retention rates, and attract quality new talent. Having a compensation policy that utilizes effective fringe benefits and perks can go a long way to setting your business apart from its competition.
The impact of employee benefits: by the numbers
When it comes to Thailand, the junior management and supervisor level was where most industries saw the highest turnover; accounting for 14% of all voluntary turnover, and 5.3% of involuntary. Performance was the biggest factor driving pay-related decisions for a whopping 95% of employers in Thailand, meaning those junior leaders were facing mounting pressure to maintain high work standards despite making the leap from an individual contributor to their first managerial position.
From an employee benefits point of view, it makes sense that businesses reevaluate their compensation packages to ensure that the right incentives to stay are given to their up and coming leaders. With “better external opportunities” and “limited internal growth opportunity” among the three highest reasons for attrition in Thailand, traditional performance pay systems may not be as effective at showing current and aspiring employees why a future with your business should be their first choice.
Other factors found in the Aon Hewitt survey were:
- The highest salary increases in 2016 was only 6% across the industries surveyed, with the travel industry posting the lowest increase of 4.7%
- 72.2% of employers followed individual performance award systems, while 38.9% offered special recognition as short-term retention incentives
- Employers invested, on average, 11% of annual base salaries on employee benefits; health coverage making up a significant majority of the fringe benefits or perks offered
We’ve written previously about attracting millennials with targeted compensation packages, however this week we’re focusing a bit more generally on what types of benefits workers in Thailand are looking for from their preferred employers.
The right perks package to make your business more desirable
According to Willis Towers Watson, these are the major trends in the employee benefits market for 2017:
In Thailand, like the rest of the world, employees are beginning to value flexible working arrangements over pay. There’s a good reason; people have more time to meet family needs, personal obligations, and other life responsibilities that can sometimes only be managed during traditional business hours. Flexibility allows staff to time their own start and finish times, and avoid stressful commutes during peak hours.
Most of all, it reduces employee burnout and allows staff to work when they feel fresh; meaning they accomplish more and enjoy being at work.
This is more to do with employee benefits providers themselves, the market is seeing itself become more customizable in the arrangements it provides to employers because of the efficiencies offered by modern technology. In particular, compensation analytics are becoming more effective as more and more data on what benefits businesses and employees use, and how they use them, is being collated.
This is providing a better foundation for both providers and businesses to build their compensation policies and staffing strategies around, while employees are finding it easier to engage with and access their benefits through online portals and device apps.
As with flexibility in the workplace, personal customizations of compensation and packages are becoming more and more desirable to employees. Performance pay systems have always been used by employers to offer recognition to high performers, however analytics is now nudging businesses to build on human capital. The following are becoming common features of a modern employment benefits package:
- Pay and benefits schedules for specific life stages (e.g. single workers, parents, retirees)
- Customized rewards programmes that allow for employee choice in their award (e.g. additional health benefits, retail vouchers, extra leave days)
- Alternative paths of career growth (e.g. tuition coverage, educational sponsorship, charitable/volunteer opportunities)
Skills-based performance evaluation remains the standard method for determining an employee’s reward for achievement, however innovative Thai businesses are recognizing that tailoring an employee benefits package can have a much better rate of engagement and, thus, retention.
Medical, health, and wellness
Again, health insurance and medical benefits remain the most popular employee benefit that employers offer, and employees expect. An earlier Willis Towers Watson article from 2012 highlighted that 46% of employees responding to a survey listed employee health benefits as the most important fringe benefit or perk they look for when considering a job offer. Obviously, your current staff may in fact have thought the same when accepting a role with you; so they, too, care very much about employer-sponsored health coverage.
Compensation data is now encouraging businesses to think about a more “hands on” approach to managing employee health and wellness. Sick leave and set-and-forget medical insurance is now the bare minimum employees expect; those wanting to ensure they’re seen as being ahead of their peers are now utilizing well planned and coordinated employee benefits packages to deliver less stressful, higher engaged, and more healthy workplaces.
How do I know if my employee benefits package is working for my business?
Regardless of whether you have a small or significant sized organization, every business can be at risk of letting their employee benefits package become costly and ineffective. Measuring staff satisfaction and engagement levels with your plan can be as easy as just asking them. A quick office survey can let you know just how valuable they find aspects of the package, how easy it is for them to understand and use, and what might be missing from it.
When it comes to the most significant part of your benefits package, health insurance and medical coverage, it can be a bit more difficult to gauge how well it’s going. Most HR teams, especially in smaller businesses, can find insurance and employee benefits a challenge; it’s not necessarily the main part of their job, however it can be an aspect of a staff member’s employment that can cause HR experts the most headaches; Where is my money? Can I claim this? How do I claim? Why is it taking so long?
Evaluating the performance of an employee benefits plan requires benchmarking, remarketing, and claims analysis. There are many HR professionals who have the ability to perform these tasks, but many lack the time to truly deliver deep insights into the inner workings of a group health insurance plan. Many insurers offer claims data to their clients, however the level of engagement in ensuring your business understands what the data says can be lacking.
The number one way to ensure you have the best benchmarking, remarketing, and claims analysis process is to engage with an experienced employee benefits and health insurance broker. Beyond providing you with in-depth analysis and discussion regarding your claims ratio, current and projected plan use, and handling an annual tendering process to ensure you’re still getting the best premium deal, you’ll also get an competitive market advantage in having experienced insurance experts in your corner.
What can Pacific Prime do to strengthen my compensation and retention strategies?
We’re exactly the expert you need to ensure that you’re not only talking to the right people when it comes to tendering an employee benefits package, but that you’re also clear about where in the talent market your package sits in relation to your competitors. That’s why using an experienced broker, like Pacific Prime Thailand, is an advantage; we have industry intelligence on what each professional sector is offering new and current talent, and how you can get the edge on your peers.
We’ve been doing it for almost 20 years, and have become the largest distributor of products from worldwide insurers such as Bupa Global, Allianz, Aetna, and Cigna. Our long standing relationships with these premier providers means that you can be sure that your HR team will get the best employee benefits and group health policy support available in the broker market. We don’t just sell packages; we support them too.
Let our corporate advisors talk to you and your HR teams about how our exceptional brokering processes and ongoing support can strengthen your hiring and retention policies. We also offer advice on tailored and targeted fringe benefits and perks, assistance with claims processing and administration, orientations for staff, dedicated and bespoke IT systems for your business, and a host of other business-related insurance solutions.
We’re in the business of simplifying insurance; all you have to do is let us help.