Some companies have very attractive bene-fits so they can easily hire talented staff. It is true that the larger companies can offer better staff benefits than small enterprises.
To retain staff and attract recruits, companies must give benefits that are more attractive than those provided by other companies. A recent STJobs survey showed that the top three benefits Singaporean employees want are annual leave, medical and hospitalisation leave, and medical benefits, in that order. Medical benefits are provided by the company to ensure that their workers are in the prime of health. My former colleague who is a government pensioner with the medical benefits entitlement card for heavily subsidised medical care said proudly: “This card is made of gold and it is something no money can buy.” While such benefits are not something one wants to claim unless necessary; they become more valuable as one ages.
The Singapore population will reach a critical point in 2018 when the number of people above 65 years will equal those under 15 for the first time notes United Overseas Bank (UOB) economist Mr Francis Tan in a research note.
By 2030, the gap between the young and old will widen more. The percentage of seniors will rise to 27 per cent and that of youths will decline to 10.8 per cent. This will put Singapore on par with present-day Japan which has 26.6 per cent of its population above 55 years of age.
The ageing population will put a strain in areas such as healthcare and social services that in turn, will affect the spending by government, employers, and individuals.
The goods and services tax (GST) increase was announced by Finance Minister Heng Swee Keat during his Budget 2018 speech on 19 February 2018. It will go up from seven per cent currently to nine per cent sometime between 2021 and 2025.
Mr Heng said that the exact timing of when the GST increase will kick in depends on the “state of the economy, how much our expenditures grow, and how buoyant our existing taxes are. But I expect that we will need to do so earlier rather than later in the period”.
The decision to increase GST was made to help fund expenditure in areas like healthcare, security, and other social spending. Healthcare expenditure, for example, has been increasing over the years, with the government spending S$3.9 billion in Financial Year (FY) 2011 and this figure increasing to S$10.2 billion in FY 2018.
In the next decade, an ageing population and increasing chronic diseases will mean building new healthcare capacity to meet rising demand and investing in new medical technologies to improve care quality.
Portable Medical Benefits Scheme
Under the Ministry of Manpower (MOM) portable medical benefits scheme (PMBS), the employer can make an additional contribution to the employees’ Medisave account every month.
Employees will be able to use the Medisave contributions to pay for the premiums of MediShield Life or Integrated Shield Plans, which can help to cover their inpatient needs.
To qualify for the two per cent tax deduction limit, the company must implement PMBS for at least 20 per cent of the local employees as at the first day of the financial year being assessed and for all local employees who start their employment during that financial year.
For full-time employees, the additional monthly contribution to their Medisave account should be at least one per cent of the gross monthly salary, subject to a minimum amount of S$16 per calendar month.
Canon Singapore has opted for the PMBS thus joining about 100 companies which have taken this approach in place of a regular group health insurance plan. For existing staff, Canon Singapore funds the premiums for MediShield Life, the Integrated Shield Plans, and the rider. About 700 employees come under the scheme.
The portable scheme acts like a comprehensive health insurance plan that is Medisave-approved and integrated with MediShield. Employees can take the plan with them when they leave the company, without losing benefits or undergoing further underwriting. Those under the scheme can continue paying for premiums using funds from their Medisave account or until they join another company that supports the scheme.
The Financial Times (8 March 2018) reported that India’s largest hotel chain, Taj Hotels, plans to pay for its female employees to undergo fertility treatment if they need or want it. This is part of a new policy intended to retain and promote female employees in the company. In a press release, the Indian Hotels Company, the chain’s Bombay-listed parent company which is part of the Tata group of companies, said that the company has decided to reimburse female employees for expenses related to “family expansion.” These expenses could include in-vitro-fertilisation, freezing eggs and sperm, and artificial insemination—procedures that are not typically included in health insurance packages provided by employers to their staff.
Indian hotel chains have difficulty finding and retaining qualified employees, especially at the high-end of the hospitality industry. Retention of women is particularly challenging for many Indian companies, as many young women come under intense pressure from their families to quit their jobs when it is time to have children.
Tata Family Values
Over the years, the relationship of Tata companies with their employees has changed from the patriarchal to the practical, and this is a bond that continues to be nourished by compassion and care.
Workers and their welfare were of utmost importance to the founder, Mr Jamasetji Tata. The Tatas pioneered several employee benefits that would later be mandated through legislation in India. Examples include the eight-hour working day, free medical aid, welfare departments, grievance cells, leave with pay, provident fund, accident compensation, maternity benefits, and gratuity.
The company created places for their employees to live fuller lives away from their offices and factories. The Tata townships in Jamshedpur, Mithapur, Babrala, Mathigiri, and elsewhere are epitomes of communal living.
Another company that puts importance on employee benefits is Singapore-listed Manulife United States Real Estate Investment Trust (MUST). It states that retaining talent is essential in the maintenance of skills and intellectual capital, productivity levels, and containing costs. The company strives to develop talent and ensure that all employees are exposed to career growth opportunities.
The company focusses on initiatives to promote work-life balance by investing in employee well-being as it is an important aspect of retaining valuable talent. A range of exercise activities and health screening programmes are offered to employees. Other initiatives include a weekly fruit day and a salad vending machine in the office building. Employees and their families are entitled to discounts on Manulife’s insurance policies.
The company believes that effective team building encourages communication, team work, and trust among employees. It organises regular lunches and dinners not only to celebrate successes and festivals, but also to facilitate communication within the team.
Some employers give designations such as “manager” or “executive” to junior employees merely to avoid employer obligations. Under the Employment Act, workers earning below S$2,500 are entitled to benefits like overtime pay, unless they are classified as managers or executives. Giving fancy titles may boost the prestige of employees but it is not a true benefit as they can’t claim overtime pay, for example. The MOM has warned employers not to mislabel staff for this purpose.
Improving Digital Skills
In May 2018, OCBC Bank announced it will spend S$20 million to develop digital skills in its 29,000 employees globally. Staff in their branches in Singapore, Malaysia, China, and overseas subsidiaries will be the first to participate in the OCBC Future Smart Programme. They will be trained in the seven domains that the bank has identified as critical to attaining digital competency.
The domains are Digital Business Models and Ecosystems, Technology and Data, Customer Centricity, New Risks, Marketing and Communications, The Way We Work, and Leadership in the Future World.
The domains comprise a suite of 6,000 online programmes as well as speaker sessions, workshops, and classroom learning. The bank hopes that the programmes will keep employees prepared for the fast-changing pace of technology so none will be left behind.
In June 2018, Citibank Singapore Ltd said that it will send 400 staff from the consumer banking and operations and technology divisions for training in the next 12 months under the professional conversion programme (PCP). PCP is a government-supported programme targeted at professionals, managers, executives, and technicians (PMETs) to undergo skills conversion and move into new occupations or sectors that provide career progression. It plans to reskill 2,000 staff over the next three years.
With business disruption surfacing almost monthly, companies are allocating more funds to staff reskilling to prepare them for new skills.
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