Article
10 min read
Author
Lorelei Trisca
Published
April 20, 2023
Last Update
July 11, 2024
Table of Contents
What are global employee benefits?
Examples of top-rated global employee benefits
Real-life examples of employee perks
Mandatory employee benefits for US employees
Why invest in a strong benefits package?
Global employee benefits trends in 2024
How to create an employee benefits package for your team
How to calculate employee benefits
Manage employee benefits effortlessly with Deel
Some employers may think they can’t afford to offer competitive employee benefits, but in today’s world of work, you actually can’t afford not to have an attractive employee benefits plan.
For 66% of workers, a strong benefits package is the most significant factor influencing their decision to accept a job offer. Similarly, companies with solid benefits offerings have 56% lower attrition than companies that don’t invest in perks.
But other than giving your business a competitive advantage in the global battle for talent, when building an international workforce, you need to ensure full compliance with local employment laws.
Here you'll learn everything you need to know about building a top-notch global benefits package while staying compliant in 150+ countries with Deel's HR and payroll compliance expertise.
Global employee benefits refer to the non-wage compensation offered to a distributed team on top of their net salary, encompassing various components such as healthcare plans, pension programs, wellness initiatives, and more.
These benefits are tailored to meet the needs of employees across different countries and are essential in attracting and retaining talent, promoting employee well-being and loyalty, and ensuring compliance with local regulations in the international work environment.
While statutory employee benefits depend on each country's employment laws, supplemental benefits, also called non-mandatory employee benefits, depend on what an employer is ready to offer.
For example, pet insurance and flexible working schedules have recently gained popularity, but employer-provided healthcare and retirement plans have been on the list of most desired employee benefits for a long time.
Other global employee benefits global workers appreciate include the following.
These packages typically cover preventive visits, routine cleanings, discounts on glasses, and more, and can cost from $10 up to several hundred dollars per employee per month.
By granting employees unrestricted paid leave as long as their work is completed, this benefit promotes work-life balance and empowers employees to manage their time and responsibilities more effectively, resulting in increased productivity and reduced burnout.
Providing financial security for employees' families in the event of the employee's passing, life insurance offers peace of mind and support during challenging times, helping employees feel more secure in their personal and professional lives.
Retirement benefits, such as pension plans and 401k contributions, offer financial security for employees after they stop working, ensuring a more stable and comfortable future, and encouraging long-term loyalty to the company.
Webinar to watch: Future of Work: What Talent Wants
Financial education and one-on-one counseling sessions help employees make informed financial decisions and improve their overall financial well-being, leading to reduced financial stress and improved job satisfaction.
Career development programs, including HR counseling sessions, paid courses, and soft skills training, foster professional growth and skill enhancement, empowering employees to take charge of their career progression.
By making monthly contributions towards employee student debt, employers can alleviate the burden of education expenses and supports employees' financial stability, enabling them to focus on their career growth.
From on-site daycare availability to flexible work schedules and dependent care assistance programs, these benefits aid working parents in managing their family responsibilities effectively, promoting a family-friendly work culture.
Wellness initiatives, such as gym memberships, meditation sessions, health screenings, and mental health benefits, prioritize employees' physical and mental well-being, leading to improved employee engagement and reduced absenteeism.
Providing a work-from-home stipend covers necessary equipment costs and acknowledges the challenges of remote work, ensuring employees have a conducive work environment, and maintaining productivity in remote settings.
This benefit offers coverage for pet health expenses, promoting a pet-friendly and caring work environment for employees with furry companions, enhancing employee satisfaction and overall workplace happiness.
Offering premium healthcare coverage that includes outpatient care, mental health support, and personalized treatments, this benefit appeals to top talent and prioritizes employee well-being, making the company an attractive employer in the market.
To enable your distributed workforce to connect and collaborate, you may want to provide passes for flexible office spaces, fostering teamwork and social interactions, strengthening employee relationships and promoting innovation.
These programs promote a culture of learning and leadership development, encouraging employees to grow professionally and fostering a sense of loyalty to the organization, creating a positive and supportive work environment.
Proven to boost employee well-being and productivity in countries like Spain and the UK, the 4-day work week introduces a healthier work-life balance and enhances employee satisfaction, resulting in increased retention and improved morale.
Here are some of the best employee benefits from top-rated companies worldwide:
According to the US Department of Labor (DOL), an employer must make sure their employees (and their families) have access to the following types of employee benefits:
Statutory employee benefits depend on the laws in each local market you hire from. Here are a few examples to illustrate how different labor laws can be.
In the US, paid time off is typically provided by most employers, but it’s not required by law. However, in most European countries, full-time employees are entitled to a specific number of paid vacation days per year, sometimes depending on their tenure.
Other mandatory benefits include:
In Asia, employees receive pension insurance, maternity insurance, unemployment insurance, medical insurance, and work-related injury insurance in almost every country.
Many employees residing in African countries are entitled to a skills development levy on top of medical and unemployment insurance.
In Australia, employees are entitled to paid time off, maternity leave, long service leave, paid sick leave, and superannuation.
In some countries in LATAM, such as Brazil, even dental care is mandatory. Other common statutory benefits include retirement plans, paid time off, medical care, and in some cases, 13th and 14th-month salary.
Additional resource
Check out our global hiring guide to learn country-specific lists of statutory employee benefits.
Employee benefits are an investment rather than an expense. According to Buck, 80% of employers experienced direct savings thanks to their voluntary benefits program, mostly through employee attraction and retention, employee engagement, and higher participation in cost-favorable plans.
The pandemic and subsequent rise of remote work started a talent war around the globe. Employees are getting picky, especially the ones who perform jobs in high demand, such as software engineers. In addition to competitive salaries, companies need to offer competitive employee benefits, too.
We want to live in a world where workers can access the best products, perks, and services regardless of their location.
—Khizar Naeem,
Senior Product Manager API & Partnerships, Deel
Benefits like unlimited paid time off, flexible working hours, or wellness programs can help increase your employee retention rate. Holistically healthy employees, who feel valued and fairly compensated for their work, are 74% more likely to be happy with their workplace, according to a Metlife study.
Learning about mandatory employee benefits around the world also helps you avoid legal penalties for non-compliance with local laws. When hiring international employees, you need to learn about minimum wages, taxes, working hours, and statutory benefits to ensure you provide your employees every legal entitlement.
Offering non-expensive incentives like paid time off can turn out to be a cost-effective strategy to meet your global team’s benefits needs while reducing overall business expenses. Small businesses can particularly gain from offering employee benefits that don't cost anything, like flexible working hours, as it'll help them attract talent despite a limited budget.
See how Crimson Education hired in new locations with more flexibility thanks to Deel.
With the right benefits package, you can help your employees be healthier, achieve a better work-life balance, and feel less stressed at work. All of this can contribute to them taking fewer sick days, creating a more positive atmosphere within the team, and working more productively.
With the changing employee needs, the global offer of employee benefits is evolving, too. Here are the top three trends we’ll see in 2024.
More than 75% of health insurers believe medical costs will significantly increase by 2025.
Research shows healthcare costs are one of the most overwhelming financial worries for families in the US. With this in mind, many US-based employers have decided to cover 100% of monthly healthcare premiums for their workforce. Whether this strategy pays off in the long term depends on how much this perk contributed to the reduction of employee turnover and the increase in productivity.
KFF’s calculation from 2021 says an individual healthcare plan was around $7,739 in total, while the total cost of hiring and onboarding a new employee was $4,425 per hire, according to an SHRM benchmarking study.
Workplace stress, burnout, and toxic environments can have a negative impact on employee productivity, motivation, and job satisfaction.
These negative effects became even more obvious after the pandemic and lockdowns took their toll on everyone’s mental health and employee stress reached a new all-time high. This pushed both employers and employees to focus more on maintaining a healthy work-life balance and company culture.
That said, it’s not uncommon to hear that an employee took a “mental health day” off from work or that an employer provides an EAP (Employee Assistance Program) as an employee benefit.
"Mental health will remain a top priority as inflation adds financial strains to a workforce already grappling with a tripledemic, caregiving concerns and hybrid work arrangements," commented Kim Buckey, VP of client services at Optavise for SHRM.
From flexible time off policies to flexible working hours, employers are realizing the importance of providing their workforce with options.
Flexibility allows talent to identify the conditions in which they’re able to do their best work and leverage their productivity to the fullest. According to McKinsey, flexible working arrangements, including the availability of remote work, are among the top three priorities for today’s job seekers.
Flexibility is the theme over everything. It goes back to the culture and so much is led by your management teams. It's been beyond proven that people have been successful in remote environments, it opens you up to really good talent and it [improves] retention strategy to show that we're giving you flexibility, and we're celebrating it.
—Casey Bailey,
Head of People, Deel
Creating an employee benefits package is complex, especially for global teams. Here are three critical steps to take.
Forecast your hiring in the upcoming year. Are you planning to hire five or 55 employees this year? Your team’s growth may help you determine how much money per employee you can set aside for the benefits.
Research the benefits you want to offer: If it’s health insurance, for example, clinics will offer packages of various prices, depending on their coverage and location.
Research the countries you want to hire from and compare the costs: How much would it cost you to hire an engineer from Mexico, Indonesia, or Germany?
Our employment cost calculator helps businesses understand the cost of employing workers around the globe. Check it out!
Survey your employees to discover which perks they prioritize and will actually use. Health insurance is the top priority for most people and that’s where the largest portion of your budget should go. Some, or all of your employees may work remotely. In that case, explore healthcare options in their own countries to make sure everyone has access to the same perks.
Calculate the cost per employee per year for each benefit you’d like to offer and determine which benefits are eligible for tax deductions.
Try to be as inclusive as possible. Understanding your employees and what matters to them will help you provide them with suitable benefits. Ask applicants what benefit was the key factor that made them apply for a job at your company. That way, you’ll learn what makes you an attractive employer and you can invest more in that particular benefit.
Bonus tip: Consider creating personalized benefits solutions. Some employees may not want to go to the gym, but they’d love to take dance lessons or live as digital nomads and prefer travel discounts.
Managing employee benefits requires human resources and time, and often requires a lot of paperwork. You may not have the capacity to deal with it on your own. Consider outsourcing your employee benefits administration to a third-party provider that can handle the whole process of offering, paying, and tracking the use of the perks you offer.
Companies that act as global employers of record can help, especially if you hire from multiple additional countries and have to keep up with numerous regulations to stay compliant. EORs are also valuable if your small business can’t afford robust benefits packages–EORs work with large amounts of clients and can unlock larger discounts.
To understand better how much in total your workers cost you and create forecasts and budgets for the future, calculate your employee benefits.
The formula includes, depending on your employee benefits package, mandatory benefits, fringe benefits, and any potential bonuses, commissions, merit pay, etc.
Here’s an example:
You’re from the US and want to hire a software engineer in Germany. For a monthly salary of $66,000, your total annual cost would be around $80,340. You’d have to pay:
Deel's Global Hiring Toolkit allows you to calculate your employer costs for a potential employee in another country so that you can make an informed decision.
Try one of our calculators:
A business needs to invest a lot of time and money into creating an attractive and compliant employee benefits package to attract and retain the world’s top talent.
Don't let the complexity of administration stop you from diving into the global talent pool. Let Deel help you manage a global team.
Solutions
© Copyright 2024. All Rights Reserved.