Startup HR: Global Benefits Case Studies & Open Forum @AT&T Park - Edward Cha, VP Global Benefits Practice Leader, ABD Insurance & Financial ...
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Startup HR:
Global Benefits Case
Studies & Open
Forum @AT&T Park
Edward Cha, VP Global Benefits Practice Leader, ABD Insurance
& Financial Services, Inc.
Zaina Orbai, Director of Human Resources, Yelp, Inc.
April 17, 2014Speakers
Edward I. Cha Zaina Orbai
Vice President, Global Benefits Practice Director, Human Resources
Leader zorbai@yelp.com
ed@theabdteam.com
Zaina joined Yelp in 2011 and oversees
Ed is responsible for the development, global HR Operations including
communication, and management of Compensation, Benefits, Mobility and
international programs and serves as a Compliance programs. She built the Yelp
strategic consultant to ABD’s multinational HR Operations function from inception to
clients on broad benefits issues. current.
He has been consulting with multinational Previously, Zaina worked for 10 years in
and global firms for over eight years, with the Retail & Consumer space and held
a focus on international employee several HR and management roles at Levi
benefits and foreign mergers & Strauss, Target and Mervyns. She has
acquisitions. Previously, he was National had the opportunity to work in a range of
Practice Leader, Client Services in the HR functional areas such as recruiting,
International Employee Benefits Practice talent management, employee relations,
for Wells Fargo Insurance, Inc. and Client information systems and most recently
Management Partner for Mercer LLC. compensation and benefits.
Ed earned his bachelor’s degree in Zaina completed her Global Professional
mathematics with a minor in chemistry in Human Resources (GPHR) certification
and a master’s degree in applied from HRCI. Zaina earned a bachelor's in
mathematics from the University of Illinois business with a minor in management
at Urbana-Champaign. information systems from California
Polytechnic University, SLO and an M.B.A.
from the UCLA Anderson School of
Management.
.
2Goals for Today
1. Learn something new that you can take back
to the office and use.
2. Network with peers to share best practices
3. Have fun!
4Intro to Global
Benefits
1. Managing benefits globally takes time and money
1. 1 employee vs. 100 employee in a given country
2. What are you trying to accomplish?
1. Cost savings?
2. Ensure employees have adequate benefits?
3. Resolve attraction and retention issues?
4. Is there a global benefits philosophy in place?
3. Going from reactive to proactive management
4. Cultural Aspect
5The Big Picture
• Global benefits are complex – but it doesn’t have to be.
• Over analyzing the situation
• Story 1 – 2 employees in Brazil with little to no headcount growth.
• Under analyzing the situation
• Story 2 – 2 employees in Brazil with potential for large growth.
6Case Study 1
How are well-being programs implemented in
different countries across different regions?
7Case Study 1
• *Prices are only illustrative and can vary by provider, countries
included and headcount size.
• Bronze: EAP & Work-life Services (support on adoption,
education, child care, etc…) = ~$1.50 pepm (per employee per
month)
• Silver: EAP, Work-life Services and Wellness Coaching = ~$2.00
pepm
• Gold: The Bronze or Silver Package + a selection of below
services
• Additional services:
• Health risk assessment - $.50 pepm
• Training/Seminars - $400/hour
• Orientation Sessions - $350/hour
• Crisis Support - $350/hour (minimum 4 hours)
• Health Screenings - $120/participant (minimum 20 participants)
• Tobacco Cessation Seminars - $1,450 (two, two-hour sessions)
• Drug and alcohol testing – custom
• Expatriate Services – custom
• Interactive Self-Assessment Tool – custom
• Life/Career Coaching – custom
• Peer Support Groups – custom
8Case Study 2
What supplemental benefit options are available
in a given country for employers to provide and
how does a company decide what the best
options are for them?
9Case Study 2
Options to explore:
1. Allowance/Cash Stipend
2. Reimbursement
3. Locally placed insurance products (e.g. local medical insurance)
4. Global insurance products
10Case Study 2
Allowance/Cash Stipend
Pros
• Easy to facilitate (inform the payroll provider)
• Easy to manage (you only manage the amount provided)
Cons
• Generally not tax efficient (no tax breaks)
• No guarantee the employee will actually use the money for benefits
(e.g. purchasing medical insurance or life insurance)
11Case Study 2
Reimbursement
Pros
• You know the employee is securing benefits
Cons
• Depending on how it’s done and individual country tax laws, it may or
may not be tax efficient
• You may not have control over the level of benefit or plan design.
• Cumbersome to administer (obtain invoices, pay invoices)
• Possibly dealing with multiple individual plans
12Case Study 2
Locally Placed Insurance Products
Pros
• If tax breaks are available, employer/employee would be eligible.
• Benefit plan design is controlled by the employer
• If the population is large enough for a group plan, medical underwriting
may be waived.
• Can utilize a local broker to manage
Cons
• Setting up benefits takes time, money and effort.
• Continual monitoring and management, even with a local broker in
place – there are items the employer must handle.
13Case Study 2
Global Insurance Products
Pros
• Benefit plan design is controlled by the employer, can have multiple
plan designs.
• Easy to administer and enroll employees and dependents
• No medical underwriting for groups larger than 20 employees across
any number of countries. E.g. 1 employee each in 20 countries.
Typically this would be 20 individual plans.
Cons
• Generally not tax efficient (no tax breaks)
• Typically not admitted insurance (does not comply with local laws and
legislation)
• Generally more expensive (but not always)
14Case Study 3
What are some of the major challenges
employee's face while traveling internationally?
15Case Study 3
• Potential challenges:
• Substance Abuse
• Family/Friends/Relationships
• Repatriation (coming back to the home country)
• Kidnap & Ransom
• Political Risk
• Natural Disasters
• Potential solutions:
• Global Employee Assistance Programs (EAP)
• Global Business Travel Accident Plans with Medical Riders
• Global Security and Evacuation Services
16Case Study 4
What strategies are used for conducting a gap
and needs analysis for global benefits programs?
17Case Study 4
Example Process:
Step 1: Global Benefits Inventory
Step 2: Global Benefits Benchmarking
Step 3: Coordination of Quotations
Step 4: Implementation
18Case Study 4
Step 1: Global Benefits Inventory
Key Data to Focus On:
• Core Supplemental Benefits (generally, the most expensive
discretionary cost)
1. Medical/Healthcare (Dental & Vision)
2. Life Insurance
3. Short-term disability
4. Long-term disability
5. Retirement
• Gather material plan information, e.g.:
– Plan design (2x base annual salary, 60% of salary, etc.)
– Insurer/Provider
– Renewal Date
– Premiums, Commissions or Fees
– Notice Periods to Cancel
– Cost-sharing percentage, if any
19Case Study 4
Step 2: Global Benefits Benchmarking
Key Data to Focus On:
• Core Supplemental Benefits
1. Medical/Healthcare (Dental & Vision)
2. Life Insurance
3. Short-term disability
4. Long-term disability
5. Retirement
High-level Global Benchmarking
Below Market
Slightly Below Market
Generally At Market
Slightly Above Market
Above Market
Requires further information
Core Benefits that are Supplemental/Discretionary/Company Provided
Provided Short-term Provided Long-term
Total Provided Medical / Provided Life / Provided Retirement
Region Country High-level Recommendation(s) Disability / Typical Disability / Typical
Headcount Typical Market Typical Market / Typical Market
Market Market
Possibly add dependent life cover
1x annual salary with 1x
and a retirement plan. With over 20 None / Varies, but
Private Medical AD&D, no dependent
employees, it will be common to 75% salary / 66.7% 75% salary / 66.7% around 3-5% into a
28 Insurance / Private life / 1-3x annual salary
provide a retirement plan and may salary salary defined contribution
Medical Insurance with 1-3x AD&D &
become an attraction and retention (DPSP/RRSP)
Dependent Life
Americas Canada issue in the future.
20Case Study 4
Step 3: Coordination of Quotations
Step 4: Implementation
E.g. for Ireland:
• Obtain Irish Company’s name and address
• Obtain Company contact – name, email, phone (whether local or in
Ireland)
• Decide on subsidy (cost share) level for employees and dependents
• Complete application forms for new members
• Complete bank mandate
• Present via web conference or in person at client’s office
21Case Study 5
China - Where there is already provincial
coverage, do companies tend to provide
additional health insurance?
22Case Study 5
Factors to consider whether or not to provide additional
medical benefits other than social security or statutorily
mandated (process can easily be applied to most benefits):
1. If there is a social healthcare system – how good is it?
2. What do major benchmarking sources states is typical practice?
3. What do people on the ground today state is typical practice?
4. What can your firm even offer due to headcount size? Can you even get
a group plan?
5. What if the employee has a pre-existing conditions and gets rejected on
an individual policy?
6. Bottom-line – if the employee gets hurt, will they have some type of
coverage?
23Case Study 6
What are the "next big things" in global benefits
after captives, global wellness, actively managed
pools, etc.?
24Case Study 6
Improving on:
1. Global medical, life, disability and retirement programs.
2. Global online, on-boarding and enrollment systems.
What is on your international wish list?
25QUESTIONS?
26KEY LEARNINGS
TO DATE
28GLOBAL FOOTPRINT
29EMPLOYEE VALUE PROP
1. Product & mission
2. Growth opportunities
3. Good place to work / Smart people
4. Compensation and benefits
30MORE & MORE COMPANIES ARE “BORN” GLOBAL
IT’S AN EVOLUTION
THE BASICS THE WORKS
Meet statutory Allowances/Stipe Healthcare
& regulatory nds/Reimbursem Programs and
requirements ents Plans
31STANDARDIZATION VERSUS LOCALIZATION
IT’S A BALANCE
Discuss with management team:
• Type of talent needed?
• Number of employees?
• Testing or growth phase?
• Expats versus local employees?
• What do local employees value?
• Understand cultural norms
32COMMON VARIATIONS ACROSS COUNTRIES
UNDERSTAND LOCAL
DIFFERENCES
• Government-provided benefits
• Government-mandated benefits
• Voluntary (not discretionary) benefits
• Market practice benefits
• Tax treatment of benefits
33FINALLY…
PARTNER WITH
EXPERTS
• Benefits Broker
• Third-Party Administrators
• Tax firm
• Employment law firm
• Immigration firm
• Mobility management company
34QUESTIONS?
35THANK YOU!
Merci Ndiyabulela
Danke Ke a leboga
Dank u Ndza nkhensa
どうもありがとう Ndi a livhuwa
Asanteni Ngiyathokoza
Chokran Grazie
شكرا Grazia
Dankie Cheers
Siyabonga Ke a leboga
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