Providing cross-border benefits complete with a myriad of variables is a dizzying prospect, but Amanda Wilkinson finds out from Honeywell’s Debra Corey that while consistency is key, it is often easier to standardise the perks package country by country so regard is paid to local practices
Luncheon vouchers may be an employee benefit that is sacrosanct in France, but few employers in the UK or indeed in the US hand them out to staff as a matter of course.
For those who work in international benefits this is just one of many cultural differences around the world that they have to take on board.
Debra Corey, director of compensation and benefits for Europe, Middle East and Africa at technology and manufacturing company Honeywell, says: “”The thing that is most important in international benefits is the global mindset and that’s where I have seen people both excel or fail. [Those] who really grasp that things are different from country to country – even within some countries there are differences – are the ones who really make it. People who try to do things the same way [across] each country, that’s where unfortunately it doesn’t work very well.”“
Corey has eight years of working in international compensation and benefits, starting with the clothing chain Gap. Then after a stint with retailer AS Watson, the owner of Superdrug, Corey moved to Honeywell last year.
She says the constant learning process of working within international benefits stimulates her. “That is the thing that is so interesting about international benefits, just when you think you know something, either you take on another country or the legislation changes.”
Corey is currently getting to grips with company car practices and brands in each of the 37 countries across her patch in order to standardise the perk.
Legal and taxation complexities mean it has taken almost a year to develop the car policy so that it is consistent, competitive, compliant, cost efficient and offers choice. It has also had to be flexible enough to accommodate disparities between countries.
For instance, with regard to choice, a cash allowance might be attractive and workable for the UK, but Corey says in some other countries, such as Belgium, it may have to be ruled out because after taking the taxes into account that both the organisation and the employee are required to pay, the allowance can end up being so low that it is not worthwhile.
Although Honeywell is able to leverage its buying power and drive down costs by having a preferred manufacturer supplier across Europe, it also has to ensure it chooses one that is suitable for all markets. “We are finding that one brand of car or manufacturer might be very attractive in one country, but then you go to another in central Europe and nobody even knows what it is and you can’t get it serviced.”
Although the ultimate aim with pooling schemes like this is for an organisation to use its increased buying power to reduce costs, there also needs to be a balance so the perk that is ultimately offered to staff remains attractive.
But Corey, who has worked elsewhere on projects to pool medical insurance, life assurance and travel insurance, says that the brand of some product types, unlike cars, is not of always of concern to employees. However, a provider’s reputation is important to those countries being asked to join the pool.
“The biggest way to win in pooling is to make sure [senior staff in your] country are involved in coming up with a partner. The worst thing that can happen is that your pooling partner has a really bad reputation in a specific country and the business there either has to be forced kicking and screaming to join or it says it is not joining,” she adds.
On occasions, Corey has blocked plans for pooling where a suitable provider wasn’t found.
While cost saving may be the driver behind such schemes, there is little point continuing with a provider if the customer service is bad. “If I start getting calls from our employees that they are not getting the service, then I don’t want to be with the provider, even if it’s going to save us money. First I will try and fix it, and if I can’t fix it, I will pull out,” she explains.
The difficulties in sourcing providers and cultural disparities mean it is often easier to standardise benefits on a country-by-country basis paying regard to common principles such as cost-efficiency, consistency and competitiveness. Corey has begun to do this at Honeywell, starting with the UK.
Although interested in flexible benefits, she is sceptical about it working across borders.
“Right now there are more dissimilarities than similarities between countries so it’s hard to have the same types of benefits for flex. In the UK a lot of people flex holiday, but if you [have] got a country where they have 35 days holiday, why flex? I am not convinced.”
There can also be issues with voluntary benefits schemes.
“When I moved to the UK I loved the idea of voluntary [benefits] and I tried to work with a provider to bring it into a few of my other countries in Europe and it just didn’t work. There wasn’t the infrastructure in place to put something like that in,” she explains. In addition, Corey says that in France, the unions already provide discounts on a whole range of products and therefore introducing voluntary benefits could have caused confusion.
She has also encountered a similar issue with employee assistance programmes. “In a lot of the countries they just didn’t have the culture. In France they were very nervous about calling a helpline [for assistance] with personal problems.”
However, she adds: “I am still an advocate of pushing the envelope and trying to roll out these programmes in other countries. I am not going to give up, it just was at that point in time it wasn’t right.”
The most complicated task Corey has worked on internationally is the development of a global share plan for executives while at Gap.
“At first we started out with a consistent approach and then the more we investigated it we realised that if, at the end of the day, it has a different outcome for employees [in different countries], then it’s not really consistent.”
Although consistency is a sound philosophy she feels it has to be balanced with the relative position of each country with regard to their compensation and benefits practices.
Corey says that while most of the countries in mainland Europe balance each other out in terms of what benefits are available, problems tend to arise with emerging markets such as India and China.
This is increasingly likely to occur as people are becoming more internationally mobile. At AS Watson, Corey spent time mapping out the groups of employees travelling abroad and categorising them into different sections. The most straightforward are expatriates, who she says can often continue with the same benefits including their pension, as they are due to return home after two or three years on assignment. Corey believes that, in time, as organisations become more global they will move towards short-term assignments, partly due to a desire to cut extra costs.
Where organisations have employees who are internationally mobile moving from one market to the other, Corey advises: “Don’t try and put them in a big standard benefits package, treat them differently and try and figure out what works best for them.”
Placing all mobile employees in an international medical benefits programme or international pension scheme is an option, but Corey warns that such a route is costly and needs to be considered alongside the company’s overseas business and HR strategy.
One thing is clear – international benefits are not for the faint-hearted. It certainly has its fair share of complex legal and taxation challenges for benefits managers to overcome.
1998-2005 In 2001, after a stint as senior manager for compensation and benefits for Europe at retailer Gap, Corey was promoted to director of international compensation and benefits. She was then responsible for the UK, Germany, France, the Netherlands, Japan and Canada.
2005-2006 Director of European compensation and benefits at AS Watson.
2006-current Director of compensation and benefits, Europe, Middle East and Africa at Honeywell.