The Corporate Wellness Blog

The World Over: How Employee Benefits are Evolving with Globalization

September 6 2016

Prior to globalization, any given company’s employee benefits were fairly straightforward. Employees hired were rewarded with an amount of vacation, medical leave, retirement planning and health insurance that reflected their seniority, specific location or country.

As globalization has proliferated and thousands of companies now conduct business across borders, , corporate benefits packages have diversified. As human resources departments scramble to keep up with a company’s geographic expansion, the benefits that employees take for granted can vary wildly from firm to firm.

While globalization is often maligned for eliminating manufacturing bases or promoting cheap labor, in terms of benefit packages, the phenomenon may actually be beneficial for employees and companies.

Taking Everything Into Account

When establishing benefit packages for employees in a certain country, it’s vital to consider what matters most to that country’s population. And as a MetLife study of countries like the United States, Mexico, the United Kingdom, India, and Australia showed, the priorities of employees, employers and the top benefits are different for each nation. Those differences reflect each nation’s overall economic conditions and the educational level, age and wealth of its labor force.

A nation may also have a proprietary structure for certain benefits; retirement plans, for instance. In Australia, retirement funds are offered by the government; in the UK, private-sector pension plans are now embedded in the national culture. This means that when a company is entering a new market, both its existing policies and the policies of that nation must be taken into account.

A Closer Look: Paid Maternity Leave

Because it has been such a hot-button issue in the U.S. lately, let’s look at the specific benefit of paid maternity leave. For many years, the United States has lagged behind much of the rest of the world on this issue. While some 178 countries mandate a certain amount of paid maternity or parental leave, the U.S. does not. From this we can see that instead of watering down benefit packages in other countries, the internationalization of benefits can be to the employees’ benefit.

Case in point, many Silicon Valley giants have come out with more generous leave policies, led by Netflix’s offer of up to a year of paid parental leave for all of its employees. Many considered this another of several other luxury benefit offerings at companies like Apple, Netflix, Adobe that are already great places to work. But it’s also an indication that tech companies, as they expand internationally, are feeling the need to match other countries’ existing benefit policies. What these companies are doing out of legal requirement in a place like India, they now must match on their own in the United States, where there is no law in place.

The Curious Case of Vodafone

Last year, Vodafone announced that it would implement a mandatory minimum global maternity policy of 16 weeks paid leave, along with other benefits, in the 30 countries in which it operates. The telecommunications provider’s goal is likely to both retain its best employees and standardize its benefits packages across borders.

As globalization intensifies, benefits packages will continue to evolve, with companies adapting their global policies to fit with an ever more connected world. For well-educated and highly skilled employees, that should prove to be a good thing. For companies who retain those workers with more generous policies, it should eventually prove likewise. After all, at Vodafone sales are climbing and profits are on the rise.

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