News: How to craft employee benefits for new-age workplace

Employee Engagement

How to craft employee benefits for new-age workplace

In the rapidly evolving corporate landscape , companies are increasingly focusing on refining their employee benefits strategies to meet changing expectations and retain top talent.
How to craft employee benefits for new-age workplace

The era of economic shifts and technological advancements is constantly reshaping the workplace. Organisations are not lagging and redesign their employee benefits as it serves not only as a tool for attracting and retaining top talent but also as a means to enhance the overall employee experience.

According to the Asia Employee Benefits report, released by CIPD, employers are concerned about meeting employee expectations to attract and retain talent. The report highlights that having a robust employee benefits (EB) package to take care of diverse needs of the multi-generational workforce will support talent attraction and retention.

The survey found that companies utilise data analytics and employee input when finalising benefits design. 

The design of a comprehensive employee benefits package provides companies with an opportunity to focus on what the workforce truly values, and plays a critical part in attracting and retaining the talent.

Trends impacting organisations’ approach to employee benefits

The findings of the report reveal that the employee expectations of better work-life balance and work flexibility have driven the phenomena of low engagement and ‘quiet quitting’, reinforcing the need for organisations to more effectively leverage their value proposition to align with the new world of work. To boost engagement and take care of shifting employee needs, employers have recognised the importance of providing a benefits package. However, organisations are finding it a challenge to forecast changing employee needs, rather than reacting to those needs once they have shifted.

The challenge to employee motivation

The ongoing large-scale lay-off at particular companies is posing a challenge for employers to keep their workforce motivated while attracting the talent. With the evolving need for new skills development, some skills are now less in demand while others are more in demand. Employers may therefore be simultaneously cutting certain roles and trying to attract people with in-demand skills. For instance, services industries in Singapore have seen higher number of job vacancies while Hong Kong has seen an increase in demand for generalised and mid-level roles.

The report reveals that employers are looking for creative solutions for their employee value proposition (EVP) and reward management using digital platforms to address the concerns of fairness, inclusion, and equality, with double standards arising for workers who are on-site and those with remote or hybrid work arrangement.

Talent competition has been found as the biggest factor impacting the benefits approach followed by hybrid working, digital transformation, sustainability, ageing workforce, diversity and inclusion, and legislative changes.

Hybrid working (38%) and digital transformation (38%) are in the top three trends impacting the benefits approach, cited by around two-fifths of survey participants. Changing socioeconomic and business environments, mental health, and demands of the younger generation are some additional trends impacting the benefits approach mentioned by some respondents.

For those who are in the business of people and culture, increasing employee satisfaction and retention is a key factor for consideration in designing the benefits package (53%). The next most important factors are budgetary controls and considerations (35%) and enhancing employee wellbeing (33%). It is important to note that well-being is considered to be equally important as budget.

A quarter of respondents (26%) highlighted that gathering employee feedback is an important factor to prioritise understanding what their staff values to find creative solutions for an attractive benefits package, while potentially reducing costs.

The report found that increasing employee satisfaction and retention is among the top three important factors for both HR practitioners and business owners, but this was higher among HR (62%) than business owners (35%). This is likely because employee engagement and talent management are more of a priority from an HR point of view.

Most provided benefits

Among those surveyed, 85% of companies provide some form of insurance benefit to their employees. Life/accident insurance is the most commonly provided insurance benefit. Despite the increasing incidence of critical illness (particularly cancers and lifestyle diseases), critical illness insurance is only provided by a quarter of employers (25%). Health insurance cover for employees’ dependents also represents a significant gap, with less than a fifth currently providing it (17%). 

The report highlights that among organisations that do not currently provide insurance benefits, the main barrier is budgetary controls and considerations (57%). 

Small organisations with 200 employees or fewer were more likely to say they do not provide any of the insurance benefits (19%), compared with larger organisations (with 201 or more employees) (6%). SMEs tend to have more limited benefits packages and resources to manage them – particularly the smallest companies, which often do not have any HR staff. In particular, respondents from SMEs were less likely to say they provide life/accident insurance (51%) or hospitalisation and surgical insurance (45%) compared with those from large organisations (69% and 66% respectively).

Benefits for the future

When asked about which benefits organisations are focusing on for the future, the majority of the employees responded that they are looking to add or enhance some insurance benefits in the next two years. The insurance benefits that organisations are most commonly focusing on for improvement in the future are life/accident (25%) and outpatient insurance (including outpatient clinical and specialist insurance) (24%). 

Two-fifths of employers are planning to add or improve their health and well-being benefits in the future (42%). Flexible/voluntary benefits were the second most commonly cited, with 19% of respondents saying this type of offering is up for review in the next two years. This indicates that many organisations in Singapore and Hong Kong want to expand their core workplace benefits programme beyond traditional financial benefits, to help staff address physical, emotional, and social needs as part of enhancing their overall well-being. There could also be a demographic consideration benefits to help people stay fit and healthy for as long as possible.

Challenges while designing benefits programe

The top three current challenges highlighted by respondents are budgetary controls and considerations (58%), meeting employee expectations (42%), and information on industry comparison/benchmarking (30%). With an increasingly diverse workforce, offering benefits that meet individual employee preferences is a priority to attract and retain talent.

It has been observed that to design affordable programmes appropriate for various employee groups, companies should ensure they involve staff in conversations when designing benefits. 

Effective communication about benefits across multiple channels that employees can easily access is also important, to help individuals understand what is available to them and increase engagement. In the survey, communicating benefits to employees was only cited as a challenge by 15% of respondents. Employers are unlikely to know they’re facing a challenge unless they regularly check that employees know what benefits are on offer and why they are provided. While three in 10 respondents said information on industry comparison/benchmarking is a current challenge.

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Topics: Employee Engagement, Employee Relations, Benefits & Rewards, #HRCommunity

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