global benefits forum...apr 15, 2015 · 5 lynsey wilson (uk) employee benefits consultant...
TRANSCRIPT
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April 15, 2015
Global Benefits ForumYour needs are unique. Our experts can help.
5:00-5:30pm Check-in, Drinks & Appetizer, Networking
5:30-6:45pm Global Speakers
6:45-7:30pm Fireside Chat, Q & A
7:30-8:00pm Networking
AgendaDRINKS AROUND THE WORLD
BeerCoopers Original Pale AleWineLayer Cake, Shiraz 2013
UKBeerNewcastle Brown Ale
BeerBeck’s, PilsenerWineDr. Loosen “Dr. L”, Riesling 2013
BeerTiger Beer, Pale Lager
Australia
Germany
Singapore
USABeerAnchor Steam® BeerWineRay’s Creek Vineyards, Chardonnay 2013 Donovan-Parke, Pinot Noir 2013
ABD’s Global Reach (video)
https://youtu.be/_Y_P3bm8HAE
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SPEAKERSAustralia – Michael Atta, Account Director, Honan Financial Services
Germany – Michael Stache, Senior Consultant, Profion GmbH
Singapore – Lawrence Adam, CEO, Sterling Knight
UK – Lynsey Wilson, Benefits Consultant, Finch Employee Benefits
USA – Tom Bayley, Global Head, Cigna Global Health Benefits
Global Benefits ForumYour needs are unique. Our experts can help.
DRINKS AROUND THE WORLD
HOSTEdward Cha, Global Benefits Leader, ABD Insurance and Financial Services
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Host
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Edward I. Cha (USA)
Vice President,Global Benefits Practice [email protected]
Ed is responsible for the development, communication,and management of international programs and servesas a strategic consultant to ABD’s multinational clientson broad benefits issues.
He has been consulting with multinational and globalfirms for over eight years, with a focus on internationalemployee benefits and foreign mergers & acquisitions.Previously, he was National Practice Leader, ClientServices in the International Employee Benefits Practicefor Wells Fargo Insurance, Inc. and Client ManagementPartner for Mercer LLC.
Ed earned his bachelor’s degree in mathematics with aminor in chemistry and a master’s degree in appliedmathematics from the University of Illinois at Urbana-Champaign.
Michael Atta (Australia)
Account DirectorGlobal & Corporate Benefits [email protected]
Michael currently heads up the Honan EmploymentBenefits Team, specialising in Global and CorporateBenefits with 10 years experience in working on globalinsurance solutions across Asia Pacific. He has a proventrack record in recommending and implementing largeemployment benefit programs into Australia, NewZealand and Singapore.
Michael holds a Graduate Diploma in Financial Planning,is a member of the Financial Planning Association ofAustralia, as well as an active member of the World WideBroker Network (WBN) and the International BenefitsNetwork (IBN), travelling extensively to remain in closecontact with global broker partners in order to obtain abetter understanding of their local requirements andensuring that their benefit programs continue to exceedlocal bench marking. Michael is currently involved ingrowing Honan’s employment benefits capabilities outof Honan’s Singapore Office.
Speakers
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Speakers
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Michael Stache (Germany)
Senior [email protected]
Michael is a Senior Consultant and Manager with morethan 8 years of experience in the field of local andinternational employee benefits. He advises companieson how to develop and implement competitive and costeffective benefit schemes. Michael is an experiencednegotiator, acting as middle man between investmentfunds and prospects/clients.
Michael assumed his current position with Profion 5years ago. Before joining Profion Michael was withAllianz as an employee benefits consultant. He hasinternational experience from his time with a globalreinsurer in New York.
He studied at the University of Augsburg, where hegraduated with a degree in Public Economics.
Lawrence Adam (Singapore)
Chief Executive [email protected].
Lawrence manages a Chartered insurance brokingoperation in Singapore with a focus on employeebenefits for multi-national corporations.
Lawrence has over 15 years experience consulting tomulti-national corporations setting up in Singapore,mainly on insured benefits. Lawrence is a Fellow of theChartered Insurance Institute, UK and has an MBA fromCranfield University, UK. Lawrence worked for 2 yearswith a venture backed technology startupheadquartered in San Francisco. Lawrence also workedin the Technology Mergers and Acquisitions departmentof Nomura in London. Nomura. Inc. is an investmentbank with USD19bn market capitalization
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Speakers
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Lynsey Wilson (UK)
Employee Benefits [email protected]
Lynsey has over 25 years in the Financial Servicesindustry with 14 years spent within employee benefits.She consults and coordinates a wide range of corporateUK employee benefit programmes including group risk,private medical insurancepensions, absence management, salary sacrificearrangements such as childcare vouchers and cycle towork schemes. Lynsey is also responsible for managinginternational client accounts including many new start upcompanies in the UK and mergers and acquisitions.
Lynsey obtained her Diploma in Financial Services in2013 and more recently obtained her Certificate inPensions Automatic Enrolment. Prior to joining FinchEmployee Benefits Lynsey was a consultant at WillisEmployee Benefits.
Tom Bayley, MBA
Global Head of Business [email protected]
Tom has spent his career in the multinational wellbeing space. He is responsible for managing the Global Business Development Team for Cigna’s wellbeing services and helping organizations plan for, organize and successfully implement international wellness initiatives. Tom has an MBA specializing in Healthcare Marketing and a BSBA in Marketing both from Xavier University in Cincinnati, OH. He resides with his wife and daughter in Pittsburgh, PA.
mailto:[email protected]
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Private Medical Cover and the impact of the Government Rebate and Fringe Benefits Tax!
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AustraliaMichael Atta, Account DirectorHonan Financial Services
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Australia
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• The Hi Tech / IT sector is one of the fastest growing employment sectors in Australia
• US Hi Tech companies establishing themselves in Australia as part of their expansion have experienced consistent growth
• The level of funded employee benefits provided in this sector is the highest across all employment sectors
What does a typical mid-tier benefits program look like?
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Australia
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Group Insurance• Death / TPD based on 3 times
annual base salary
• Income Protection covering 75% of base salary with a 30 day waiting period and a Benefit Period to age 70
• The level of funded employee benefits provided in this sector is the highest across all employment sectors
Group PrivateMedical Insurance• Hospital and Extras which includes
Dental, Optical, and Physiotherapy, etc. (Single would be the base offering through to Family cover).
Superannuation
EAPs
What are influencing factors that need consideration?
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Australia
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How competitivedo you want to be?
• Mid-tier benefit will meet local benchmarking
• Top-tier benefit to attract and retain employees
Consider your available budget
What is your global base offering
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A Snapshot of the Australian Healthcare System
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Australia
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The Government funded Medicare system is the foundation of our local health system
Medicare provides all Australians with basic health and medical services. This includes GP visits, treatment in a public hospital and pharmaceutical costs when treated in hospital. For low income individuals and families, Medicare will also cover dental and other allied practitioners
Pressures on the public health system
• Medical advances and development of new drugs, etc. has seen the average life expectancy increase substantially.
• The effect of this is the enormous financial strain it places on government resources
• Governments around the world are looking at means of addressing this problem. The Australian government is no different.
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Australia
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Medicare Levy Surcharge (MLS)In Australia, due to increasing cost of providing basic medical cover for all Australians, the government charges Australians Medicare Levy through taxes, to assist in funding this service of between 1% and 2% of our taxable income.
Government Rebate 0n Private Medical Insurance (PMI)• To encourage more Australians to
take out PMI and to ease pressure on the Public Hospital system, the Federal Government back in 2012 introduced a flat 30% government rebate on Private Medical Insurance premiums.
• In 2013, the government revised this rebate and one’s eligibility is now means tested based on total household income.
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Australia
Entitlement by income threshold for 2016-2016
Base Tier Tier 1 Tier 2 Tier 3
Singles $90,000 or less $90,001 -$105,001 $105,001 -$140,000$140,001 or more
Families $180,000 or less $180,001 -$210,00 $210,001 -$280,00$280,001or more
REBATE
Under 65 27.82% 18.547% 9.273% 0%
65-69 32.457% 23.184% 13.910% 0%
Over 70 37.094 27.820% 18.547% 0%
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This adds a significant layer of complexity in establishing Group PMI
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Australia
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Lifetime Health Cover Loading
At the time the Federal Government introduced the tax rebate on Private Medical Insurance they also passed legislation which stated that if one didn’t have some form of PMI by their 30th birthday then when they do decide to take out cover at a future date, they will pay a 2% premium loading for each year they did not hold cover from the age of 30.
This move has been very successful in getting Australians to take out cover earlier.
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Factors to Consider in Establishing PMI as Part of a Local Benefits Program
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What Level of government rebate should be applied to the plan?
• When we establish a Group Private Medical Insurance Plan, we need to factor in the government rebate percentage.
• This can never be an exact science, as whilst we know an employee’s salary, we have no means of determining each employee’s total household income.
• We recommend two options:
1. Factor in the full 28.82% rebate
2. Factor in a 9.273% rebate
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Fringe Benefits Tax (FBT)
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• In Australia the government charges FBT on the majority of funded benefits at a revised rate of 49%, as of 1st April. This is an increase from the previous rate of 47%.
• FBT applies to benefits such as Private Medical Insurance, discounted loans, company car.
• If structured correctly, we can avoid FBT on benefits such as Death / TPD and Income Protection.
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Do you fund Singles Cover only or do you fund cover based on employee needs?This really does come down to cost. Where possible we do recommend that cover be established based on each employee’s needs.
Based on our client base I would say that 70% of Hi Tech Companies will fund full cover and around 30% Singles cover. Two years ago these figures would have been reversed.
What provider should we choose?There are a number of Group Private Medical options that are available. The two more common and the two we tend to recommend include Bupa and GU (Grand United) Health.
Premiums can be funded Quarterly, Six Monthly or AnnuallyPremiums are closely regulated by the Federal Government with rate increases communicated March annually and come into effect April annually. Over the last ten years the average annually increases has been on average 5-7%.
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In Conclusion
• Overall as Australians we do enjoy an excellent Healthcare System which at the end of the day provides all Australians will access to basic medical assistance.
• Cost to fund PMI is a significant expense to Australians.
• Where provided as a funded benefit it is very well received and can be a key factor in retaining and attracting quality employees.
• Get advice and partner with a local Broker who can advise, implement and provide a high level of ongoing service and advice.
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• Honan Financial Services is one of the few brokers outside of the big four that understand and have the ability to recommend, implement and service local benefit programs.
• Head office is based in Melbourne with offices in Sydney, Brisbane, Perth, as well as Auckland, New Zealand and Singapore.
• Through this network, Honan Financial Services is able to provide a complete global solution.
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About Honan Financial Services
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Thank You
Australia is famous for its vast landmass, climate, beaches, kangaroos, koalas, etc. But when you visit us, it’s our beautiful wines, great beers and friendships that will remain with you.
At the conclusion of this evening’s presentations, I invite you to continue sampling some of our wine and beer, where I’ll be happy to answer all of your questions.
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Any Questions, eh?
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Germany
• Custom high-tech benefits benchmarking highlights.• Why there is no need for supplemental health benefits!
Michael Stache, Senior Consultant Profion GmbH
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Germany
Why are Germans so weird?
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St. NicholasKrampus Krampus
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Germany
Why there is no need for supplemental health benefits! Mandatory health benefits
State Sickness Fund or Private Insurance
Excellent Coverage
Inpatient, Outpatient, Dental, Vision, Salary Continuation, Drugs etc.
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Germany
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Custom high-tech benefits benchmarking highlights (1)
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Germany
Custom high-tech benefits benchmarking highlights (1)
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Germany
Percentage of Industries with a Benefit Plan
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All Industries
High-Tech
Custom high-tech benefits benchmarking highlights (2)
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Germany
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Custom high-tech benefits benchmarking highlights (3)
TYPE OF BENEFITS% OF COMPANIES
ROVIDING BENEFIT
Retirement Benefits 92%
Life Insurance / Survivors’ Benefits 98%
Long-Term Disability Benefits 77%
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Germany
DC Rate for Retirement Benefits
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€100,000
€50,000
Base Salary
% of contribution
1% 3% 4%2%
3.59%
All Companies
3.52%3.51%
3.79%
Start-Ups
Custom high-tech benefits benchmarking highlights (4)
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Germany
Custom high-tech benefits benchmarking highlights (V)
Level of Life and LTD Benefits
Average Life Lump Sum 2.1 x base salary
Average LTD Lump Sum 2.2 x base salary
Funding & Vesting
Funding Group Support Fund (72%)
Vesting Immediate (38% 55%)
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Fragen?(Questions?)
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Singapore
• With job vacancy rates up 8.9% and a fierce competition for talent in the tech sector, what part does benefits play to attract and retain talent?
• …and examples of how you can implement benefits for free.
Lawrence Adam, CEOSterling Knight
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Singapore –Tight market for talent…1. Vacancies available for all education levels, including university
degree level.
2. 58% of vacancies were in the categories “professionals, associate professionals, servicing and sales”.
3. Top reasons cited by employers for job vacancies in PMETs (Professionals, Managers, Executives and Technicians) include:
a) “Local employees find pay unattractive”
b) “Local employees lack the necessary work experience”
c) “Competition for local candidates from other employers is too stiff”
4. We see benefits playing a part in b) and c)
Source: Job Vacancies 2014 Report, StatsSing, Sterling Knight Analysis
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http://stats.mom.gov.sg/Pages/Job-Vacancies-2014.aspx
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…shrinking labour pool a long term issue due to demographics.
“…we expect our local employment growth to slow dramatically in the next few years, dropping from this base of 95,000 last year to around 20,000 per annum in the last part of this decade. This is largely due to our baby boomers gradually exiting the workforce, and our smaller cohorts entering the workforce”
Source: Parliament Committee of Supply Speech 9th March 2015
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http://mom.gov.sg/newsroom/Pages/SpeechesDetail.aspx?listid=510
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…but support is available!
Government support to companies in Singapore:
a) Wage Credit scheme - co-funding of 40% of wage increases given to Singaporean employees earning a gross monthly wage of SGD4,000 and below
b) Support on Benefits to make jobs more attractive to locals and to tap “non-traditional” workforce – how do we access this without cost?
Source: Inland Revenue Authority of Singapore: Wage Credit Scheme (WCS)
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http://www.iras.gov.sg/irashome/WCS.aspx
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Singapore - Benefit 1: Training of employees.
1. Productivity and innovation credits – 400% tax deductibility on training of employees or up to maximum SGD60,000 (USD45,000) cash pay-out.
2. Skills Development Fund – up to 95% of accredited course fees.
Sources:
1. Inland Revenue Authority of Singapore Productivity and Innovation Credit
2. Singapore Workforce Development Agency Funding for Employer-Based training
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http://www.iras.gov.sg/irashome/PIcredit.aspx#About_Productivity_and_Innovation_Credithttp://www.wda.gov.sg/content/wdawebsite/L102-ForEmployers/L223E-007EmployerBasedFund.htmlhttp://www.iras.gov.sg/irashome/PIcredit.aspx#About_Productivity_and_Innovation_Credithttp://www.wda.gov.sg/content/wdawebsite/L102-ForEmployers/L208-WSQforEmployers.html
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Singapore - Benefit 2:Flexible working hours…
1. Development grant of up to SGD40,000 (USD30,000) - aimed at helping employers defray the costs of implementing FWAs and other work-life programmes
2. Flexible Work Arrangement (FWA) Incentive up to SGD120,000 (USD90,000) - to motivate employers who have implemented FWAs to provide and sustain work-life friendly workplaces
Source: Ministry of Manpower Worklife Grant
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http://www.mom.gov.sg/employment-practices/work-life-harmony/Pages/work-life-grant.aspx
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Singapore …free travel on the BART equivalent in Singapore
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Singapore - Benefit 3:Employee Assistance Program
1. EAP implementation emphasis = “concierge” services provided by EAP rather than counselling.
2. Already commoditized as some insurers may automatically include it in their health insurance offering.
3. If not in the health insurance, most, if not all, of the cost can be subsidized via Workplace Health Promotion Grant.
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Singapore –Employee Assistance Program
Component Sevices/Activities Price Total Price Grant (*Subject to HPB’s approval)
Cost to Sterlng Knight/yr
General Health Online Health Risk Assessment (HRA)
$6.00Pepy
$120.00 $60.00 $60.00
Health Education Activities(Eg. 2x Lunch time talk)
$395.00Per hr
$790.00 $395.00 $395.00
$910 $455.00 $455.00
Mental Health Talks on Mental Wellness(1x EAP orientation & 1x Lunch time talk)
$350.00Per hr
$700.00 $700.00
EAP(Employee Assistance Program)5 session Model
$5.95Pepm
$1,428.00 $1,428.00 $
$2,128.00 $2,128.00 $
$3,038.00 $2,583.00 $455.00
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Conclusion:
1. Keep an eye on legislative changes in Singapore –they are likely to subsidize some benefits you are (will) provide.
2. Discuss with your consultants, who will keep up to date on this for you.
3. Check out our blog at: blog.sterlingknight.comwhere we provide some of these updates.
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http://blog.sterlingknight.com/
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Soalan? கேள்விேள்?有问题吗?(Questions?)
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Stay current with the new pension legislation that is a required for employers!
UKLynsey Wilson, Benefits ConsultantFinch Employee Benefits
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April 2015
UK Pension Legislation
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Who we areFinch Employee Benefits
• Based in Manchester (Sheffield and Halifax) UK
• Number of employees – 60
• P&C and Employee Benefits
UK Pensions• Millions of people are not saving enough for their retirement. Life
expectancy is increasing and people saving less.
Government basic pension – Single person £115.95 per week (£6,029 )
• Under the current law State Pension Age will already increase to:
• 67 between 2034 and 2036
• 68 between 2044 and 2046
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Solution / Auto Enrollment
• The Pensions Act 2008 requires all employers to automatically enrol their workers into a qualifying workplace pension scheme (if they are not already in one)
• Each employer is given a specific ‘staging date’ on which to do this –determined by total number of individuals in the employer’s largest PAYE (Pay As You Earn) scheme based on information from HMRC (Her Majesty Revenue & Customs) as at 1st April 2012
PAYE is the system that HMRC uses to collect Zincome Tax and National Insurance contributions (NICs) from employees.
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Staging Date
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Options• Use existing pension scheme
• Set up a new pensions scheme; or
• Use NEST
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• Introduced by the government as a low-cost pension scheme, the
National Employment Savings Trust (NEST)
• Defined contribution
• Trust-based scheme – with its own set of trustees
NEST
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Criteria
As an employer, you will need to:
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• automatically enroll and pay minimum contributions for any workers aged at least 22 but under State Pension Age, who earn more than £10,000 (2015/16 tax year) in a year.
• enroll and pay minimum contributions for workers at least 16 but under 75 who earn more than £5,824 in a year and who ask to be enrolled.
• enroll any workers aged at least 16 but under 75 who earn below the earnings trigger who ask you to enrol them. However, you don’t need to pay contributions for them.
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Contributors
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• It is common practice in the UK to base pension contributions on basic annual salary.
• However, the auto enrolment regulations introduced the concept of basing pension contributions on a band of earnings, known as ‘qualifying earnings’, of between £5,824 and £42,385 (2015/2016).
Phasing Contributions
Date Employee % Employer % Total
October 2012 – Sep 2017 1% 1% 2%
Oct 2017 – Sep 2018 3% 2% 5%
Oct 2018 onwards 5% 3% 8%
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Postponement• Can postpone at staging date or new joiners for up to 3 months.
• Why – time to prepare, cost, align with probationary periods
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Opting out
• Workers who have been auto enrolled have the right to opt out within one month from active membership created and receive a full refund of their contribution
• If opt-out they will be re-auto-enrolled in 3 years and every 3 years after that should they continue to opt out
• Opt out figures so far – LOW 5% - 15%
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Headline Responsibility
• Auto Enrolment Scheme
• Assess employee eligibility (every time you run payroll)
• Issue correct postponement notice (if using postponement)
• Provide information to employees when they become eligible
• Process opt-outs and refund opt-out contributions
• Repeat process every 3 years for those who opt out
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Thank YouAction Points
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• Find out your staging date if you go on The Pension Regulators website and enter your PAYE number: http://www.thepensionsregulator.gov.uk/employers/tools/staging-date.aspx
• Nominate a contact to ensure that you receive relevant documents which the regulator sends to employers: https://forms.thepensionsregulator.gov.uk/workplacepensionsreform/nominate.aspx
http://www.thepensionsregulator.gov.uk/employers/tools/staging-date.aspxhttps://forms.thepensionsregulator.gov.uk/workplacepensionsreform/nominate.aspx
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Questions?
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Cigna
Global Health Benefits
Tom BayleyGlobal Head of Business Development
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Global Wellness
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WORKING WELL: A Global Survey of Health Promotion and Workplace Wellness Strategies Survey Report (Buck, 2014)
Why global wellness?
Reducing sick leave & increasing presenteeism, followed by improved employee morale & engagement
Top international health drivers?
Stress & Physical Activity, followed by nutrition.
Who’s offering global wellness?
56% of multinationals have a global wellness strategy, up from 34%in 2008. HR leaders are most often the drivers of the initiative.
What are they offering?
The most common program elements are; HR policies for flex time & PTO, EAP, Wellness Communication & Flu Shots / Immunizations.
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Global Wellness (cont.)
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WORKING WELL: A Global Survey of Health Promotion and Workplace Wellness Strategies Survey Report (Buck, 2014)
What's cool and new?
Programs like Telephonic Physician Support, on-site child care, Cycle to Work and on-site lifestyle & nutrition programs
Most common programs to address productivity?
Flex time & PTO, tobacco-free worksites, ergonomic work stations andtelecommuting.
How to incentivize
Monetary incentives are not the answer – especially if lifestyle change is the goal. Use preventive services, gifts, merchandise, raffles or drawings. Communication, culture & program design are as valuable, if not more so, than monetary incentives.
Monetary incentives are pretty good if participation is the goal;health risk assessments or biometric screenings.
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Global Wellness (cont.)
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WORKING WELL: A Global Survey of Health Promotion and Workplace Wellness Strategies Survey Report (Buck, 2014)
What's the key to creating a culture of health?
Significant, holistic leadership commitment. Environmental & infrastructure support for healthy lifestyles. Ever-present wellbeing brand.
How to communicate the program?
Simplicity still seems to be best. Posters, emails & home mailings. Peer influence & competitive challenges are common, while gamification, social media, mobile & wearable device integration are slowly catching up to the US.
Final tips for success…
Use data to measure healthcare outcomes & drive next steps.
Allowing for the entire family to access wellbeing programs is on the rise, and is proving to provide for more meaningful results.
Measure employee satisfaction...not just participation.
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Questions?
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Thank You!
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Merci
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