As companies start getting back to some normality and workers are returning to work there are challenges ahead for multinationals but also opportunities, particularly when it comes to overhauling employee benefits to make them fit for purpose for a post Covid-19 world.
Many Multinational employers are looking at how they manage the return to work, including their people risks and business risks and key part of is adapting their benefits for a new working environment. Here are some key considerations.
The return to work
Managing the return to work needs to reflect different regulations in regions and countries.
For example, in the UK from 1st August the UK government has given employers the choice over whether their employees continue working from home or return to the workplace[i].
In France employees have returned to the office, but in the USA, because of recent new virus outbreaks some states have imposed working at home again. In the UAE, people are returning to the office, but many must wear masks if they cannot socially distance by two metres[ii].
Employers also need to consider how people feel about returning to the office. Some will be scared to return to the office and prefer to work from home. Others may be desperate to return as they have found working from home challenging. This may also be a generational issue. Workers in their 40s with families and space to work are more likely to welcome continuing to work from home than a 20-year-old graduate living in a flat share with limited space.
The situation is likely to continue to be extremely fluid for the rest of the year with local lockdowns and changes in government policies at short notice which will create a further challenge for employers.
One certainty is employers need to implement their carefully considered return to work plans. The initial focus for most employers will be providing a safe business or workspace environment for their employees, clients, and suppliers to operate within.
But organisations must also consider issues beyond the physical limitations of their buildings and surrounding areas and consider the wider risks around health and wellbeing for their business and their workers.
The rise of flexible working
The pandemic has increased the adoption of flexible working patterns and more companies are now recognising it can work. Google recently announced that nearly all their 200,000 staff worldwide will be working remotely until summer 2021[iii]. Facebook’s chief executive Mark Zuckerberg he expects half of its workforce to do their jobs outside Facebook’s offices over the next five to 10 years[iv].
A forecast by Global Workplace Analytics[v] estimates that 25-30% of the global workforce will be working from home multiple days a week by the end of 2021.
Employees may have tried working from home for the first time and now want a partial return to the office. Recent research by the Adecco Group UK found that the majority (77%) of UK employees say a mix of office-based and remote working is the best way forward post COVID-19[vi].
Employers will need to be mindful of this shift in attitudes to flexible working and tailor their employee benefits accordingly. Offering flexible working benefits could keep workers happy and motivated, and employee benefits may need to be adapted to homeworkers. They may for example include allowances for gas and electricity and providing desk equipment and internet access, rather than interest free season tickets which will not be needed if people aren’t travelling into the office as much.
There will also be health and safety issues to consider and what insurances employers have in place to cover home working.
Mental health issues
The pandemic has shone a light on mental health. Whilst this was already on the corporate agenda for many companies, the enforced lockdown and the impact on people’s mental health have highlighted the importance of this issue globally.
In the USA it was reported that the coronavirus pandemic was pushing America into a mental health crisis with anxiety and depression rising[vii]. A survey in India found that the number of mental illness cases had increased by 20% since the lockdown, with at least one in five people affected[viii].
In the UK, the Centre for Mental Health recently said the pandemic is likely to increase the number of people in Britain experiencing a mental health problem in the next two years.
Employers will urgently need to address mental health as we emerge out of this crisis and ensure mental health support is a key part of their health and wellbeing benefits.
A major factor that could come out of a rise in mental health issues is growing absenteeism and presenteeism. This is already giving global businesses a headache, especially in the Asia Pacific region.
In a survey by AIA Vitality, Hong Kong was highlighted as having one of the highest levels of absence and presenteeism of all the countries taking part in the survey. The estimated monthly cost of health-related absence and presenteeism per organisation in the city is estimated at $3,744,262[ix].
Meanwhile, in Singapore, it is estimated by 2030 absenteeism will worsen, leading to productivity loss. Cost to Singapore SGD$3.3 billion, 43% higher than in 2016. In the USA, the economy loses over $2 billion to absenteeism each year[x] .
In the UAE, the level of absenteeism in the workplaces is also moderate or high. This comes with a high price tag, due to the combined cost of wages paid to absent employees and reduced productivity.
Presenteeism – or going into work whilst sick is also a growing problem. Bupa Hong Kong reported employees spent a quarter of total working days working whilst sick, a productivity loss of HK$30 billion per annum. In Singapore, research by the Duke-NUS Medical School found it can cost local employers SGD$12.1 billion per annum.
The pandemic has seen this issue move into people’s homes too. Research[xi] by the Mental Health Foundation and LinkedIn with HR professionals, highlighted concerns that home working was causing a rise in employee burnout and ‘e-presenteeism’ in the UK.
They found over three-quarters (79 per cent) said they believed the widespread implementation of home working encouraged so-called ‘e-presenteeism’ – where workers feel obliged to be online and available, even if feeling unwell or already having worked their contracted hours.
Employers will need a robust mental health strategy to support their workers who may be struggling. This could include early intervention through being aware of these issues with the help of technology and rehabilitation through Employee Assistance Programmes and access to professional support.
The importance of wellbeing
The lockdown has also offered some insight into wellbeing challenges employees may face in future if they continue working at home.
A study from Yorkshire Cancer Research[xii] in May found that physical activity among adults had fallen by a quarter since the lockdown came into effect – leading to a third of people putting on weight. They found those who have increased in weight have put on an average of six pounds during recent weeks.
Coupled with this, the typical adult has gone from doing an average of two hours of physical activity a day prior to the restrictions to just one hour and 32 minutes now. This includes everything from a short walk to cleaning the home.
The lockdown has also caused some people to make poorer diet choices and increase their snacking leading to weight gain. Working at home may well become a growing trend but without adapting exercise and diet regimes there are clearly ‘hidden’ health risks that workers and employers need to be aware of.
Employers will need to factor in these different health risks that come from working at home, which could impact the health and wellbeing of their workforce in the future.
Companies might want to introduce wellbeing programmes that encourage a healthier lifestyle including eating more healthily and exercising more, taking regular screen breaks, and encouraging social interaction with colleagues, both virtually and in person.
They may also consider taking out Private Medical Insurance (PMI) for their employees so if they do get sick, they can access medical treatment quickly. This is likely to be increasingly important as NHS waiting lists look set to get longer following the pandemic.
As home working may reduce costs for companies, reinvesting this saving into PMI could be something businesses may decide to do and extend cover to a greater number of employees.
What does all this mean for employee benefits of the future?
The world of work internationally, is changing and so is the Employee Value Proposition (EVP). The traditional ways of working need to be overhauled to better reflect the flexible and agile way that people live their lives.
The pandemic has brought many existing workplace trends to the fore, speeding up adoption of things like flexible working as well as raising concerns around mental wellbeing. As discussed, it has also brought a whole array of additional challenges for multinationals considering their benefits packages. Employers will need to do even more to attract and retain employees as the world economy recovers.
As the crisis has focused much attention on health and wellbeing – this will need to be at the centre of any employee benefits package to enable employers to better support existing employees as well as attract the best talent in a competitive employment market.
Health cover will therefore be a priority for many, and we expect to see increased demand for PMI and global Employee Assistance Programmes, as well as more companies offering access to virtual GPs as a global standard.
Critical illness cover is expected to be offered by more organisations too, as there are growing risks to people’s health from serious illness.
Many people put off going to the doctors during lockdown or were unable to access appointments. For instance, Cancer Research recently estimated 2.1 million people have missed out on screening; 290,000 people with suspected symptoms have not been referred for hospital tests and more than 23,000 cancers could have gone undiagnosed during lockdown[xiii].
The NHS Confederation[xiv] recently said that the Covid-19 crisis could see the number of people waiting for NHS treatment double to 10 million by the end of the year. Employers will want to ensure their employers are looked after and have cover in place in case they get seriously ill.
We expect more enhanced people policies too. An early lesson from the crisis was that illnesses are no respecter of status or seniority. Employers should review their business protection insurances for employees deemed of major importance to the business.
But the crisis also gave some much-needed recognition to lower earning employees across the country. Such individuals often fill the more routine or mundane corporate jobs, yet many were pivotal to looking after and feeding the nation during the long weeks of lockdown.
Low paid does not equal low skills or low importance. Every employee represents an important cog in a corporate machine, even if that role often goes unnoticed. It follows that businesses now need to look after such workers and, where necessary and possible, aim to level-up employee benefits offerings at the next available review date.
Companies will also need to look at their business policies around health and safety, especially if more of their workers are going to work at home. The employer has a duty of care to ensure the home is safe for employees. Travel policies will also need to be looked at in light of the pandemic.
Multinationals have an opportunity to overhaul their entire benefits strategy and ensure it meets the needs of the workforce and the business going forward. With so many considerations employing a broker could save time and money, especially for those operating in multiple countries.
Brokers can help put together a global strategy that can be rolled out across multiple countries, but which considers local laws, cultures, and customs. We work with clients to build a sustainable business for the future, with a robust, healthy, and adaptable workforce.
As we move out of the pandemic this will be even more vital as companies recover from what has been the biggest upset in the global economy for more than 100 years.