Navigating multinational benefits: challenges and considerations

Much of the success that consultants find in solving challenges with multinational clients will come from actively listening to their needs, understanding the international marketplace and deploying a thoughtful solution.

As the global economy becomes more connected, it’s easy to see how one country can affect the rest of the world. This became more prevalent during the pandemic, when supply chains were impacted in ways that most did not expect. For example, reduced computer chip production in Asia dramatically affected vehicle manufacturing around the world – dramatically changing the supply and demand structure.  Additionally, the enhancement of communications and improvements in shipping and logistics have helped accelerate the sense of being more tightly connected across the globe.

For companies with an international presence, navigating our increasingly connected world is a matter of daily business. To be an international workforce, a “work from anywhere” mentality must take precedence as organizations become more connected. At the end of the day, they want to ensure their employees feel connected and cared for in all aspects of their wellbeing. Every office — whether domestic, international or a combination — is part of a single, connected entity. 

Given this reality, multinational employers want to ensure their employees thrive by offering comprehensive benefits that align with corporate strategies and values, despite where they are located.  Those benefits may also reflect the way they view their workforce – with consistency and cohesion. However, offering benefits internationally can be a challenge due to cultural norms and country regulations. Having the right partner with the right knowledge can help mitigate those challenges. 

Benefit consultants must consider all complex variables within a company, not just within their domicile country.  Consultants must consider differences in demographics, psychographics and even geographic locations. That may mean different attitudes towards benefits, different regional requirements or different benefit needs based on the multiple stages of life. When you start crossing international borders with multinational organizations, those challenges are only amplified.

The varying needs (both employees’ needs and the regulations of their native countries) can result in a range of different challenges:

Cross-border identity protection

In a recent case, a U.S.-based organization introduced a new voluntary benefits suite that included identity theft coverage to their U.S.-based employees.  While they also had employees in several provinces in Canada, they elected not to offer the voluntary benefits to the Canadian employee population.  Unfortunately, months later, the client experienced a cyber/identity issue with their Canadian workforce and the existing identity theft vendor could not provide coverage in Canada. This incident highlighted the necessity for a swift solution that could cater to both the American and Canadian marketplaces. 

Taking a broader view, had the organization adopted a holistic approach in the first place, they could have identified multiple viable international voluntary benefit solutions.  By doing so, they would have created a consistent and comprehensive benefits strategy that met the needs of all their employees, promoting overall organizational wellbeing. 

Unlocking the power of total rewards

Every year, Gallagher conducts a comprehensive benefits strategy and benchmarking survey from organizations across the United States, Canada and the United Kingdom.  The results of the survey are presented through the Workforce Trend Report Series, which captures insights on topics like health plans, a wide variety of employee benefits, salary planning, HR technology, retirement and more.

The Physical & Emotional Wellbeing report has historically acknowledged that offering ‘ancillary’ or ‘voluntary’ benefits is vital to an employer’s overall benefit strategy.  In the 2023 benchmarking report, the top reason for offering ancillary or voluntary benefits was to provide comprehensive benefit packages (see chart for top five reasons).  

Moreover, the larger the organization, the more important voluntary benefits are to the organizational strategy and its employees.  For the largest organizations, 74% feel that voluntary benefits are important to providing comprehensive benefit packages.  Many of those businesses have multinational strategies and a diverse employee workforce to supply benefits.

The modern workforce is composed of diverse employee populations, each with unique benefit preferences and expectations.  Generation Z (born 2001 to 2020) represents the young workforce, likely in the early stages of their career, possibly single or recently married, actively saving, considering homeownership and having a significant digital footprint presence.  In contrast, baby boomers (born 1947 to 1964) are more experienced in their career, may have fewer family obligations and place emphasis on wellness and preventative health as they prepare for transition into retirement.  

With the workforce now consisting of five different generations, catering to these varied interests becomes achievable through ancillary or voluntary benefits.  In many instances, voluntary benefits are paid primarily by the employee. 

Beyond the diversity from a generational standpoint, there is diversity from an employee population standpoint, including renewed focus on equity for part-time employees who are becoming more eligible for voluntary benefits due to a rise in the gig-economy post-pandemic. The goal for the employer is to choose a cost-effective combination of traditional and non-traditional voluntary benefits that aligns with the highest priorities for most of the employees. 

Considering the above, the key to the overall success of a comprehensive Total Rewards program is the communications and employee engagement.  According to Gallagher’s 2021 Q3 Insights Magazine, “reaching remote employees involves different methods, and likewise, engaging diverse workforce groups can require varied messages.” Recognizing an elevated need for transparency, many leaders are making a greater effort to ensure they project a sincere tone.  Without the full support of a comprehensive benefit package and diverse communications, the employees simply are not aware of the program and don’t appreciate the value of a wide-ranging benefits package. 

Unlocking success with multinational benefits

Much of the success that consultants find in solving challenges with multinational clients will come from actively listening to their needs, understanding the international marketplace and deploying a thoughtful solution. Nonetheless, there are a few tips to consider for ensuring success:

Employers are using Total Rewards to address compensation, virtual work, employee wellbeing, and DEI. In a post-pandemic era, global employers are looking for ways to attract and retain talent, regardless of location. The broad age range, demographics and various career and life stages are a global concern that make addressing wellbeing difficult. A key aspect is financial wellbeing and how employees are turning to their employers to aid in this. While benefit packages need to be culturally appropriate, it’s important to design flexible solutions for all demographics. Flexibility and options are a key component in the success of a global benefit strategy.

Summary

In a highly connected world, meaningful, intentional and holistic benefits help employees thrive. To that end, these thoughtful and cohesive benefits can help organizations prosper, but it will require some level of consistency – no matter where your multinational organization exists.  Those goals may result in additional advantages such as simplified benefit administration, enhanced (plan) solutions, and complimentary value-added services.  Meanwhile, clients may also experience internal efficiencies, reduced financial exposure and greater overall success. Global benefits should be considered for a variety of reasons, but success comes when you put people first. 

RAE Egleston is the area president, Voluntary Benefits Practice, at Gallagher.

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