The New Corporate Nomad and How Employee Benefits Keep Them on the Team
The answer for many global employers lies in developing a group of employees -- kind of corporate nomads -- who can fill critical corporate talent needs, if only for a short periods of time. And in a recession, this option has become more common. A global employee benefits program becomes essential with these employees. Employers report that the most difficult jobs to fill in 2013 are those in the skilled trades, engineering, sales, technical staff and accounting and finance positions, according to the Manpower Survey. Employers can't afford to lose scarce talent because a global employee benefit program is inadequate.
For some firms, such as consultants and contractors, global employee benefit issues may be the key part of the equation for retaining talented employees. Comprehensive coverage gives employers, current employees and future employees the kind of peace of mind that can help make foreign assignments less worrisome and a more attractive option.
DBA Accident Insurance
The Defense Base Act (DBA) is a federal law that requires all U.S. government contractors to provide disability compensation and medical benefits to employees while working overseas. It's kind of a worldwide workers' compensation benefit. And it's not only required for companies with military contracts -- it also extends to all government contracts with any U.S. government agency.
DBA coverage is usually available from carriers for both primary, on-the-job coverage and wrap-around accident coverage. Wrap-around coverage usually covers employees when not on the job and away from work.
The best wrap-around coverage includes specialized claims handling and medical benefit coordination and worldwide accidental death and dismemberment coverage, in addition to other important features. DBA is often part of a portfolio of accident and health coverage options that include 24-hour employer-paid accident insurance, voluntary employee-paid accident coverage and specialty health/stop-loss coverage.
Travel and Accident Insurance
One of the worst nightmares that an employee can face while traveling overseas is the confusing and unfamiliar healthcare systems of other countries. It's an increasingly common issue, often unpredictable, and associated with both accidents and illnesses. What happens when an employee is confronted with an unexpected natural disaster in a country far from home? And with the increasing political unrest overseas, these issues remain top-of-mind for employees and employers.
Travel insurance generally covers the employee en route to the new location and before they leave to return to their home location. The core of the coverage is to give travelers access to medical, security and legal services along with information and personal assistance to travelers. How do you refill a prescription in Dubai? What should you do if you have lost or misplaced your passport? There are a host of issues that a traveling employee can encounter and many that they have simply not thought through before they leave the United States.
Equally important are similar requirements for foreign employees handling an assignment in the United States. Employees need access to a worldwide network of medical travel assistance and other services that offer a 24-hour call center and a global communications benefit. And what if, for example, a traveler requires admission to a foreign hospital where it's common to require full payment for services upon discharge? A good travel insurance policy provides a guarantee for reimbursement to the foreign medical facility along with the ability to debit the employer or employee's credit card for payment overseas.
Global Employee Benefits and Enterprise Risk Management
Formulating a global employee benefit program usually requires the active participation of risk management, human resources and senior management. One issue remains clear: long-term labor shortages throughout the world, especially for experienced and talented employees, require benefit programs that attract and retain the best employees. Managing the "corporate spend" and human capital can impact the success or failure of strategic initiatives.
Corporate risk managers may have overlooked human capital risks in formulating their enterprise risk strategy. That's not surprising -- It can be difficult to incorporate global human resource risk into the ERM program if data and information are only available on a country-by-country basis. There can be a need to develop baseline measures and data that will enable risk management and human resources to quantify the human capital risk. It's not unusual, for example, for many companies to lack a basic inventory of the different programs and policies throughout the world, especially if the company operates a decentralized employee benefit program.
Essential to this process is collaboration between risk management and human resources. At their core, risk management identifies and quantifies corporate risk, while human resources tends to focus on the needs and requirements of human capital. ERM helps risk management identify and mitigate human resource risks that may have been overlooked. Then it enables a process that can identify the best and most cost-effective ways to minimize human capital risk.
These risks can be multi-faceted, involving strategic, operational, market, financial, compliance and "people risks". A collaborative enterprise risk process can serve as the corporate catalyst, enabling management to be prepared for what could be an ongoing, significant issue that affects performance of the organization.
"Incorporating human resource issues into an enterprise risk management program can help resolve some potentially persistent issues, such as whether programs and policies ought to be heavily directed by the home office or whether these issues ought to be handled on a decentralized basis," explains Lance Henderson, Head of Distribution - Corporate and Life Pensions for Zurich Global Life North America.
He added, "When you think about it, your employees are your most important assets. These kinds of issues need to be an essential part of an enterprise risk strategy."
(The above piece is part of our continuing Insights series designed to highlight key products and services to our readers. This paid-for Insights was written and edited by Risk & Insurance®
on behalf of our marketing partner. Additional Insights can be found on our Web site at www.riskandinsurance.com.)
June 26, 2013
Copyright 2013© LRP Publications