EXPERTISE GUARANTEED: Employee Benefits and your company's duty of care

Employee benefits, better known as fringe benefits, are experiencing explosive growth. Given the duty of care that employers have towards their employees, it is important to keep pace with this trend. According to our experts, not all benefits are being fully utilised and, too often, the benefits offered are not fully tailored to employees' needs. On the one hand, there are “tangible” fringe benefits such as a company car, meal vouchers, etc. and on the other hand, there are “intangible” benefits such as group insurance or medical expense coverage. In this dossier, we would therefore like to take you through the most common intangible fringe benefits, which can also yield surprising returns in the longer term.

The importance of employee benefits

Offering these benefits is in the interests of both the employer and the employee. Specifically, this refers to all benefits that an employer offers to the employee that are not included in the traditional salary.

In addition to a competitive salary, employees benefit greatly from having a number of additional benefits in their remuneration package, because ultimately this leads to lower private expenditure in their daily lives and, in the long term, it is important to look forward to a comfortable retirement. And that's not all: what if an employee becomes seriously ill and loses part of their salary?

All these matters can be covered in our country by good insurance policies taken out by the employer for its employees. We are thinking here of the employer's “duty of care” towards its employees. To what extent does an employer provide a good safety net for its employees? Experts note that these issues are receiving increasing attention – from the employees' side – in wage negotiations, so it is in a company's best interests to provide good solutions in this area.

Moreover, there have been many positive developments in recent years, both from insurance companies and brokers. These are systems that are being developed to support HR departments, but also to facilitate access to these plans. What is also often unknown is that every SME now has access to these plans, which are no longer reserved for larger companies.

The group insurance

Group insurance should enable you to maintain your standard of living in the event of retirement, illness, accident or death.

Group insurance often focuses on retirement. In our country, every person who is active in the labour market is entitled to a statutory pension, also known as the first pension pillar. In addition, it depends largely on the employer whether and what type of supplementary pension the employee will have. The latter is also referred to as the second pension pillar. In other words, good group insurance helps to guarantee a comfortable retirement, both financially and otherwise.

A recent survey by Assuralia shows that 54 percent of employees surveyed trust that the government will provide a sufficiently high statutory pension. These figures demonstrate that there is a great deal of uncertainty and that it is therefore in a company's best interests to build up a favourable supplementary pension for its loyal employees and to be able to demonstrate this to job applicants in order to attract new talent in the “war on talent”. No less than 80 per cent of employees believe that it is also the employer's responsibility to contribute to this, and 76 per cent see this as an important factor in wage negotiations.

In the past, a distinction was often made between manual workers and white-collar workers in a company. For example, the pension plans (for a supplementary pension) for manual workers and white-collar workers were not the same. However, since 2015, efforts have been made to gradually abolish these differences. In concrete terms, new pension plans (introduced on 1 January 2015) may no longer make any distinction and companies with both workers and employees must, in principle, have the same pension plan.

However, the provisions for death and guaranteed income are often very affordable in terms of cost and, in the event of long-term illness or death, extremely useful for the employee or their surviving dependants. If, for example, the group insurance also includes death cover, the beneficiaries receive the amount of the death cover if the employee dies before retirement. Very often, this is a multiple of the annual income, taking into account the family situation. But it can also offer considerable financial protection while the employee is alive. For example, you can choose to save more for a supplementary pension or insure a higher death benefit.

Guaranteed income

Recent figures show that no other country has as many people on long-term sick leave as Belgium. Yet only 18% of employees currently enjoy this benefit, even though more and more employers want to include this guarantee in their group insurance policies for welfare reasons. It is therefore useful to examine this issue in more detail in this dossier.

More than half a million Belgians are currently on long-term sick leave for a variety of reasons: cancer, rehabilitation after an accident, burnout, etc. Guaranteed income provides a safety net. In concrete terms, employers make a conscious decision to guarantee replacement income for every employee so that they do not suffer financial ruin if they are unable to work due to an accident or illness. In our country, employees fall back on social security after one month of illness. In other words, employees receive their full salary during the first month of absence.

There are many different policies on the market that vary in terms of waiting period, type of cover, percentage of cover, age limit, etc. It is therefore advisable to seek assistance from an insurance broker.

The guaranteed income is also an extra-legal benefit that does not disappear like many other extra-legal benefits. Think, for example, of the company car that has to be returned or the meal vouchers that are not paid when you are not at work.

Medical expenses

Another important aspect is the medical expenses covered by the employer. According to experts, this is something that employees consider very important. Whereas the focus used to be more on financial recovery, prevention (such as dental care and outpatient costs) and support services (such as home help and reintegration into the labour market) are becoming increasingly important aspects of a good package.

Hospitalisation insurance protects employees, and often their family members too, against medical expenses before, during and after hospitalisation and in the event of serious illness. In addition, there is also increasing attention to outpatient medical expenses, with more generous reimbursement of medical expenses throughout the year, regardless of hospitalisation.

Furthermore, a very important advantage of this type of policy through work – compared to individual policies – is that acceptance is without medical formalities.

Given the market's need for these products, an evolution is also visible here. Current technologies make file management easier. For example, there are more and more digital tools that make it easier to keep track of everything. This saves both the HR department and the employee headaches and time.

Business Travel

Another important insurance policy – which, according to experts, is still too often overlooked – is travel insurance through work. After all, caring for employees who represent the company goes beyond mere “traditional” medical assistance. What if an employee has to go on a business trip and something happens?

This goes beyond the most logical things such as an accident or a strike affecting the means of transport you are travelling with. Very often, these policies also cover things such as an interpreter who is needed to assist you if something serious happens. What's more, there are policies that are fairly easy to take out and therefore cover not only the company's “frequent flyers” but also “occasional travellers”. In fact, family members of business owners can often benefit from this insurance too. Finally, the conditions of cover apply not only to larger companies but also to SMEs.

Awareness raising and guidance

According to experts, everything starts with good guidance and awareness raising.

According to experts, there is no standard formula or ready-made solution. There are so many factors – such as the sector, whether or not the work is manual, high-risk occupations, age, number of employees, region, etc. – that play a role in setting rates. In addition, most employees know that they receive “something” in terms of benefits, but are not familiar with the details or the policies. Employers, for their part, are often happy to offer fringe benefits, but do not go out of their way to find the most suitable formula.

In addition to the well-being of employees, which is paramount, employee benefits also have a financial aspect. There is nothing wrong with a company looking at which fringe benefits reduce wage costs. For example, hospitalisation insurance is not tax-deductible but is exempt from social security contributions, and group insurance is deductible as operating costs.

Succession is just as important

According to experts, succession is just as important as taking out the right insurance policies.

In addition, laws often change. Take the Verwilghen Act, for example, which was amended in 2007 but still has a major impact today. The Verwilghen Act imposes specific rules on the individual continuation of hospitalisation insurance when an employee leaves the company. Depending on the policy, the employer can continue the existing cover without any additional medical formalities.

However, trends also change over the years. For example, in addition to physical complaints, there is now much more attention for psychological complaints.

Whereas in the past, psychological complaints were dealt with purely through financial intervention, various insurance companies are now increasingly focusing on prevention and active support to help people return to work.

In addition, guidance ensures that employees find the right path more easily, which is also cost-efficient for the company.

Here too, according to the experts, it is very important that employers are aware of the most recent policies, but it is also important to inform employees about any changes.

As a specialist insurance broker, we have developed digital tools to make it easier for both employers and employees to track their files. The role of the broker remains crucial and must be able to provide advice and assistance. So make sure you get good advice and contact your insurance broker in good time if you have any questions or uncertainties.