Are your employee benefits still relevant?
Sanlam Corporate's Dr Matete Lerutla and Viresh Maharaj present findings of the 2020 Benchmark Survey.
CHRO South Africa on Friday hosted a webinar in partnership with Sanlam Corporate where the question was raised whether employee benefits are still relevant for the current times. The event coincided with the release of the 2020 Sanlam Benchmark Survey, which is one of the most referenced research papers in the retirement fund industry and seeks to provide insights and stimulate conversation that effects a positive financial outcome in retirement for South Africans.
The survey is based on the findings from over 1,000 interviews conducted with key stakeholders.
Sanlam Corporate managing executive for human capital Dr Matete Lerutla said that the Covid-19 pandemic accentuated the need for companies to review their benefits, which need to evolve along with the changing needs of the dynamic workforces they were supporting.
The Benchmark Survey analysed generational split of clients administered by Sanlam and found that millennials now account for just under 50 percent of active contributing members, with Generation Xers accounting for 40 percent. This, Matete said, needed to be reflected in the way companies approached their employee benefits offerings.
Said Matete: “We also need to reflect on how personalised the benefits offering is. How often do we engage with our employees regarding their benefits? Is it something that we do once a year, quarterly? Or is it something that we don't do but rather wait until we are probed for answers? Because if we are not relevant to the employees that we are serving, then we are not delivering the employee-centric value proposition that we espouse to.”
She suggested that companies review their employee benefits offerings by allowing for more flexible employee benefit contributions, providing options for employees to opt-out and opt-in when their personal circumstances demand and reducing work-related expectations when employees face personal and professional conflicts.
In the context of the pandemic, Matete said employees were facing threats on three fronts – the potential loss of life, potential loss of income and the very real possibility that they won't have enough savings to take care of their medical needs in the event that they do fall sick and that these factors cause strain on the physical and mental wellbeing of employees that HR practitioners needed to take into account. With all these challenges in mind, it is foreseeable that people will struggle to balance their immediate needs with the importance of investing for the future.
The success of any organisation would thus depend on the extent to which it had its employees’ interests at heart and implements employee-centric value propositions.
“Retirement fund contributions are entrenched in the offering employers provide from an employee benefits standpoint, with the benefactors often given little choice having the find. However, despite this mandatory retirement savings requirement, only 10 percent of employees are retiring comfortably,” said Matete.
Sanlam Corporate managing executive Viresh Maharaj then presented the findings of the research, saying 12 percent of South Africans polled were concerned about the short-term impact of Covid-19 on their personal financial situations and two-thirds were concerned about the long-term effects of the virus and the lockdown.
“Looking at the All Told Covid-19 Survey, which polls South Africans at each week during the lockdown, to get their progressive views on various issues, we see that the fears of loss of earnings increased dramatically as did fears around lawlessness. This reflects the increasing desperation across various segments of South Africa.”