Friday, July 18, 2008 Non-wage benefits By Nancy R. Cudis and Debra M. Estero Sun.Star Staff Reporter, Correspondent
SINCE many companies cannot afford to raise the salaries of their employees above the mandated minimum wage, some have come up with non-monetary ways to help workers cope with rising prices.
Some companies provide meal subsidies, health and life insurance coverage to employees while others give free education to children of their workers.
Jeoffrey Escala, senior manager of Celestica Philippines Inc., an international electronics manufacturing services provider that has established operations at the Mactan Economic Zone (MEZ), said the company provides meal subsidies, health and life insurance coverage to its workers.
Confederation of Philippine Exporters (Philexport)-Cebu executive director Fred Escalona noted that several export companies also provide meal subsidies so that their employees can save a little of their salary.
Some educational institutions, like St. Theresa’s College-Cebu, offer the children of their employees free education, from preparatory school to college. St. Theresa’s College human resource officer Alan Trani said that while the school does not have new benefits for its workers, other than those mandated by law, it also gives cash gifts for December.
But with basic commodities becoming more expensive—June inflation reached 11.4 percent against May’s 9.6 percent—many companies have realized that they are losing many workers to better-paying jobs overseas.
Marco Protacio, Hotel, Resort and Restaurant Association of Cebu (HRRAC) president and general manager of Waterfront Cebu City Hotel and Casino, said increasing prices are prompting industry workers to work abroad.
Migration
“Inflation is affecting our food costs, operations and (most of all) our employees who directly feel … the high cost of transportation and other commodities,” said Protacio in a phone interview.
The same is happening in other industry sectors.
“The big challenge of manpower now is migration, especially by engineers to Japan, Malaysia, Singapore and the US (United States) where the pay is higher. We can’t stop them from going out,” Escala said.
“What we’re doing is we evaluate every year the benefits we give to those (who stayed with us) to make sure we are competitive,” he added.
Brother International Philippines Inc., on the other hand, does not only provide competitive pay but also organizes social events, which promote loyalty to the company, said general manager Toshiaki Isayama.
Protacio said HRRAC members have not yet bared their plans to ease the effect of inflation on their workers, but individual establishments will continue with their respective salary increase programs based on performance and tenure.
A worldwide survey by Watson Wyatt Research revealed that the top reason used by people who leave a job remains to be dissatisfaction with the current compensation and benefits.
The study was presented by JobsDB country manager Jayjay Viray during a recent business forum held in Cebu City.
“In the Philippine situation, the top reason Filipinos give for leaving their companies is low-base pay,” Viray told a group of Cebu-based human resource practitioners.
The second reason is when an employee does not see a salary increase in the near future, she said.
She said it is important for companies to review their employees’ take-home pay on an annual basis to ensure that the salary given is still within a competitive range in the industry.
However, not all companies can afford giving more, particularly in the present economic conditions.
Escala, also president of the MEZ Human Resource Association, disclosed that some departments of certain companies in the zone are reducing production work from seven days a week to six or five days a week due to decreasing orders. This affects the take-home pay of some employees as well.
Oscar Canton, who owns a construction company based in Lapu-Lapu City, said in his industry most companies could not offer more aside from what is mandated by law.
Canton said he just feels blessed that his business is doing “good.” He said he also believes that he should share the company’s earnings with employees.
“I believe in giving more to my employees for them to be productive,” he said. He added that he give additional allowances to loyal workers.
Skilled workers, though, are more particular about their basic pay than non-monetary benefits.
Eliza Magallon, senior analyst for recruitment of a business process outsourcing company in Cebu, said workers in her organization are more concerned about how much they take home instead of health care benefits or non-wage benefits.
She said a company must make a study before providing additional benefits or incentives to its employees. “It’s not because it would create an imbalance in the industry, but it is more of sustaining it,” she added.
She said some companies implement an incentive program that also improves productivity.
JobsDB’s Viray said a company can also retain its talent through non-monetary ways, like implementing leadership and training programs.
It is also important for managers and decision makers in the companies to be visible and transparent and not to be afraid of answering the employees’ “hard questions,” she said. “Show leadership during the tough times, crises or moments of change. The employees must see that you are riding the rough seas with them.”
