Good employee benefits will be beneficial both for the employees and the employer. The employees’ work satisfaction and engagement increase, means higher productivity. Higher productivity means better output for the company’s overall goal.
As part of the competitive compensation package, employee benefits’ job to retain top talents has become very crucial. Especially in the post-Covid era, where people now learned that working from home can be as productive as working from the office. New and creative benefits have popped up, and it’s the company’s job to find out which one works best for their pool of talents.
What are Employee Benefits
Employee benefits are compensation and added perks provided by the company outside of their base salaries. Said benefits can be anything from law-mandated insurance to a free gym membership, depending on the scale of the company and the employee’s stage in life.
Employee benefits are usually a part of a competitive compensation package that’s available for all employees, especially top talents who are hired for their exceptional skills. Companies often explicitly list all types of employee benefits on their job vacancies to attract more candidates to apply.
Every country has their own specific employee benefits offered, but it mostly covered financial bonuses such as overtime payments, stock options, etc., and non-financial perks such as flexible working hours or training opportunities.
Types of Employee Benefits
There are various employee benefits available, depending on the company’s size and budget. But in general, there are three types of employee benefits, they are:
1. Work-related Benefits
Work-related benefits are something that will make the employee feel humanized when it comes to working hours, and the freedom to perform it.
It’s no surprise that the flexibility to work from anywhere could be one of the most sought-after work-related benefits today. According to a survey by ConnectSolutions, 30% of employees who worked remotely are actually doing more work in less time and 77% of them show increased productivity.
Paid time off (PTO) is mandatory by law, but the amount can vary from country to country, and depending on each company’s policy. A 12 day PTO is what’s common, but if a company is able to give more than that amount -and then some, it could well be a magnetic benefit to attract top talents.
Overtime work currently is simply unavoidable. Whether it’s overtime at the office or working outside their home city/country. A reasonable compensation, be it financial or additional day off to offset the overtime can be beneficial for both the company and the employee.
Access to training and development in skill enhancing courses, class, or coaching opportunities are something that will interest top talents who thrive in their self-betterment. This benefit will not only be good for the employees, but also the company. Better quality employees produce higher quality work products.
2. Health-related Benefits
The mother of all benefits, health-related benefits are what started it all. Major companies have offered health-related benefits such as insurance (life, dental, medical, disability, etc.) to their employees as part of their compensation. In most countries, a medical plan is mandatory. The difference lies in the level of coverage, the broader, the better.
Aside from insurance, nowadays companies also offer gym membership and access to mental health care facilities to support their employees. Some even offered a sabbatical or customized leave schedule to their top talents, in the hopes that they will increase the employees’ mental well-being and come back stronger.
In companies that need it, additional Accidental Death, and Dismemberment (AD&D) policies will also be made available. Some disability insurance may also be offered that covers both long-term and short-term disability or illness.
3. Financial-related Benefits
Financial-related benefits come in the form of additional money offered outside of their basic compensation. This includes bonus, commissions, awards, gifts, and other on-paper compensation such as stock options, RSUs and profit-sharing.
Bonuses are one of the most common financial-related benefits, and it’s usually tied to the company’s performance or the employees’ achievements. The amounts are extremely varied, depending on the company’s ability to disburse them.
Another thing that’s tied to achievement or performance are sales commissions. Where applicable, the salesperson may be entitled to a certain percentage of the company’s overall sales or more.
And finally, retirement plans. Depending on where you live, some companies will offer this financial-related benefit, especially in countries that have a fully established retirement plan such as the U.S. and their 401(k).
Why are Employee Benefits Crucial?
Employees benefits are crucial because it has a strong ripple effect on the company’s bottom-line. If employees feel that they’re taken care of, productivity will undoubtedly increase, and that means the company’s profit also increases.
Not to mention, happy employees will most likely stay loyal to the company. This means less cost for recruitment and increase in employee retention. A company who shows appreciation for their employee’s efforts by providing generous compensations and benefits will surely become a sought-after company to work for.
According to the Society of Human Resource Management (SHRM) research, 92% of employees consider employment benefits as important for their overall job satisfaction, and 63% of job seekers surveyed say that they pay attention to what benefits a company offers before they decide to apply for the job.
Good employee benefits are also key in retaining the company’s high-performing employees without having to keep increasing their salaries. Sometimes money is not always everything. Some top employees may value more freedom to work from anywhere and will be happy to take less salary if it means they can have it.
Most Common Employee Benefits for Singapore
There are a wide variety of benefits that a company can offer to their top talents or hire, but in Singapore, these are the most common employee benefits popularly given to their employees:
- Annual Leave
- Housing allowance
- Retirement benefits
- Medical/Hospitalization Leave
- Transportation reimbursement
- Annual Wage Supplement (AWS)
But what’s interesting is that workers in Singapore have some other benefits that they really want and need, but not a lot of companies offer them. Here are the top seven benefits highly sought after by Singaporean workers according to Swingvy:
- Dental insurance
- Gym membership
- Buy/Sell annual leave
- Flexible cash benefit
- Flexible working hours
- Better medical coverage
- Company-paid health screening
Dental insurance shot to the top of the list due to their nature of highly expensive procedures. A visit to the dental clinic can cost you starting from $200 to well over $1000, and that’s considered expensive for most employees.
When an entrepreneur or a company considers offering employee benefits, there are a lot of factors to weigh in, especially when you don’t have enough funds to spend. Try focusing on covering the basic benefits needed to offer by law, and then customize each benefit based on the employee’s needs.
A remote work option may interest a certain group of employees, while a reimbursement for travel expenses (public transit, tolls, gas, etc.) will entice the others. Find out what works best for each employee, talk to them, and hear them out. Who knows, you might need not to spend a dime to retain that top talent and keep them happy.