Working in the same company throughout one’s career isn’t enough to cope with the increased cost of living anymore. According to the 2021 Randstad Malaysia’s Employer Brand Research, 72% of Malaysian employees ranked salary and benefits as being the top value proposition. While this isn’t breaking news, being able to increase salaries isn’t possible for many businesses, nor is it a sustainable solution to employee satisfaction.
But how much weight should companies give to employee benefits?
The gradual decline of choosing a better salary
In today’s changing landscape and economy, the workforce comes in all shapes and sizes, from remote employees to freelancers. To remain competitive and attract top talent, companies must focus on other aspects of their employee value proposition that meet the needs of their employees. According to the 2022 Hays Asia Salary Guide, more than 5 out of 10 employees looking to switch jobs are dissatisfied with their current salary or benefits package. While salary is important for a job, today’s workforce prioritises other factors such as work-life balance and flexible benefits, which includes wellness programmes.
Hence, it’s important for companies to recognize that there are other non-monetary methods to show appreciation and reward employees. Employee benefits have been shown to signify a company’s commitment to long-term employee satisfaction and well-being. Furthermore, the guide found that salaries were not the biggest reason why employees would stay with their current employer.
The findings from the survey are as follows:
- 41% – work-life balance
- 38% – salary or benefits package
- 37% – work location
- 36% – management style and company culture
The demand for better employee benefits is on the rise
According to a Qualtrics survey, Malaysia has the second-lowest employee engagement in Southeast Asia, with 54% in 2020, a decrease from 59% in 2016. The unfortunate truth is that many companies in Malaysia tend to provide standard and rigid employee benefits, which may not actually be what everyone needs. This creates a gap between what employers offer and what employees desire, which can be a disadvantage for companies in this competitive landscape. Employers in Malaysia need to further enhance their strategies by exploring ways to increase employee engagement such as offering more competitive employee benefits and creating a culture of recognition.
“Employees are increasingly demanding work-life balance from their employers, and there is a higher proportion of employees who view company benefits as important as salary. When it comes down to individual benefits, we see an increasing demand for optical, traditional Chinese medicine (TCM), and wellness benefits. Wellness benefits include gym membership, supplements, yoga classes, and mental well-being.” – shared Clarence Zhang, Co-founder and Country Manager for Mednefits Malaysia.
With the demand for better employee benefits on the rise, many Malaysian companies want to re-examine their strategies to place a greater focus on employee well-being. However, while there has been a shift towards employee flexible benefits as a means to attract and retain top talent, many companies are still unsure of where to begin.
A different approach to offering benefits to employees
A growing number of organisations that presently provide benefits through insurance or manual reimbursements are transitioning to the flexible benefits model. This comprises them implementing flexible benefits spending accounts for each employee and embracing the next-generation digital benefits platform, which has dynamic capabilities to meet a wide range of employee needs.
The digital benefits platform will replace the basic “portals” or “systems” that are not able to offer real-time data nor allow companies to self-serve when they need to. Companies will eventually look at digital benefits systems to cut premiums and administrative costs and implement flexible benefits with ease. Ultimately, with the average spending amount per employee likely to surge due to rising healthcare expenses, a viable path ahead is to shift to a flexible benefits model that allows the company to have complete cost control without losing the range of benefits offered to employees.
How Mednefits aids in the transformation of its clients
An example of a company that has reaped the benefits of a more productive and efficient workforce with a flexible benefits model would be Vieqwest, a Singapore-based Internet Service Provider that provides fibre broadband services to businesses and residential users. Viewqwest used to provide employee benefits via a traditional corporate healthcare plan that encompassed the usual hospital and outpatient medical coverage. However, they found that the solution was too costly and unsustainable in the long run, especially given how employees were severely underutilising the benefits in comparison to the premiums paid.
After discovering Mednefits, they found that the flexible benefits model suited their needs better because not only could they fully control the costs allocated towards such benefits, but they could even offer a range of wellness benefits that were more extensive than the previous medical-only coverage. All of this was done without incurring any additional costs, and in fact, they now had an automated and efficient platform to manage all these forms of benefits customisation.
Reshaping a better future for employee benefits
While there is an increase in demand for better benefits, the decision an employee makes between a benefits package ultimately comes down to their specific career goals. For some, a higher pay rate may be the most attractive option in the short term, but for others, it may be worth investing in a customised benefits package that could pay off in the long run.
To tackle the challenges that lie ahead, companies should begin leveraging solutions like Mednefits to cater to the needs of their employees. These companies provide an affordable and customisable corporate benefits solution that can be tailored to meet the needs of different employee groups.
