Dubai: Companies in the Middle East will run the risk of losing their valued expatriate workers and find it difficult to attract the best staff if they don't do something to improve their benefits programmes, experts have warned.
Many organisations in the private sector are lacking in the area of employee benefits, which are essential in retaining and recruiting top talent. There is very little provision that looks after the workers in case of disability and there are apparently no pension plans to supplement retirement in future years.
Duncan Crerar, head of employee benefits at Nexus Group, an independent insurance broker, pointed out that the benefits situation in the region is indeed "problematic".
Income protection
He said the "most glaring and recurring benefits omissions" in the Middle East tend to centre around income protection. Without income protection, workers will likely struggle to get by if they find themselves disabled or too sick to work. "There is typically little or no coverage provided in the case of long-term disability and all too often there is no meaningful platform or assistance for employees making provisions for old age," he told Gulf News.
"A common mistake made by Middle East-based businesses is to bundle all manner of benefits into a single lump sum wage. Strictly speaking, this does not qualify as a benefit. For example, a housing allowance that gets swallowed up with the rest of your outgoings is not the same thing as a company-provided house," he added.
He said it is crucial that business leaders offer clearly defined employee benefits if they are to stand out in a competitive marketplace. This is particularly important especially now that expatriates are growing increasingly concerned about the absence of substantive social security frameworks and top employees are looking to companies that demonstrate concern for their long-term wellbeing.
Crerar cautioned that employers can incur costs of between six to 18 months of an individual's salary should they lose an employee, largely due to the time and effort it takes to recruit, re-integrate and re-train new staff. So, the best way to avoid financial headaches associated with replacing employees and preventing them from joining competitors is to keep staff happy and loyal.
"This is where employee benefits come in, boosting employee welfare, ticking those all-important corporate social responsibility boxes, as well as acting as a hugely prominent incentive for attracting talented recruits," he said.
Hazel Cowling, partner and consultant director of biz-group agreed that more could be done to improve regulations around employee protection, but financial packages are not the only benefits that can incentivise staff. She suggested that companies should also look for alternative non-monetary ways to reward and retain their staff.
"Offering your staff a sense of job security is essential and this can be achieved by doing really basic things such as paying salaries consistently and on time, communicating regularly and being transparent about the company's external position, discussing career progression on a regular basis, providing safe and healthy working conditions or even celebrating team achievements regularly," she said.
"A company's vibe and culture are the foremost reasons that make people either stay in their job or jump organisations. Every company should go over and above employee benefits to ensure that their culture is attractive and creates a sense of pride and loyalty among the employees."
Crerar is optimistic that things will change. "Abu Dhabi has a legislation in place demanding medical coverage for all, and there are plans in place to extend this to all the emirates by around 2013.
"In the not-too-distant future, a full range of benefits will either become mandatory, or so common within the marketplace that out of touch employers will find it difficult to attract and retain top quality staff," he said.
