GCC: Employers revamping benefit offerings to remain competitive
Source: Middle East Insurance Review | Oct 2018
The Gulf region has witnessed a concerted shift in employers moving from a pure-pay model to an emphasis on ‘total rewards’ for staff, said Aon in a new study on allowances and benefits in the GCC.
While in previous years organisations were spending more aggressively on their cash-allowance packages, the results this year show an increase in the prevalence of benefits being offered to employees across the region.
The enhanced end-of-service-benefit (EOSB) has also become a more frequent offering among employers, with figures more than doubling from 17% in 2017 to 35% in 2018, according to Aon. The prevalence of other benefits have also registered strong growth with life assurance up 12%, accidental insurance up 20% and long-term disability up 20% compared to one year ago.
This growing trend is reflective of organisations aiming to optimise their costs and total reward offering, while customising it to the needs of their workforce, according to Aon.
Other findings from the study revealed that:
- Paternity leave is becoming increasingly common among the best employers in the region;
- Maternity cover is the most prevalent treatment covered under medical benefit to all employee groups in the GCC;
- Standard working hours for the region clock in at 48 hours, with a range spread of eight hours per week;
- Typically, the maximum number of working days for annual vacation is 25 days and most organisations allow deferral of annual leave from one year to the next;
- The most prevalent allowances offered to executives, management and professionals are housing allowance, transport and children’s education assistance;
- Employees at executive and management levels are much more likely to receive education assistance, with a prevalence average of 83.5% among this group, while for professionals and support staff levels, the percentage is notably lower;
- The least common benefit for executives and professionals is overtime (10% on average), compared to a prevalence average of 50% for support staff; and
- Two thirds (65%) of organisations provide relocation allowance to employees at the executive, management and professional levels, compared to just over one third (34%) for support staff.
- The results of this study are particularly interesting, as they demonstrate how organisations are looking at and leveraging allowance and benefits structures to secure and retain the right talent with the right skillsets to help drive their business objectives. This is extremely important for the region, which is focused on promoting and nurturing local talent to support the growth vision of the GCC nations. The study also points at the shifting trends in the allocation of allowances and benefits, which will serve as a referral point for industry best practices,” said Mr Christopher Page, CEO, talent, rewards & performance, Aon Middle East and Africa.
The comprehensive study, conducted between February 2018 and April 2018, covers diverse business sectors across the GCC region and is based on an analysis of more than 100 multinational companies and locally-owned conglomerates across different sectors. M