Case Study: Employee Benefits

Case Study

This month I interviewed Samer Abdel Kader, Head of SEI Investments Middle East on their latest advances in End of Service Benefits, an important strategy to research in order to recruit and retain employees.

 

Tell us your name and what you do

I joined SEI Investments back in April 2013 and I am currently heading the firm’s operations across the Middle East region. I am lucky to be part of one of the few organizations developing a customized solution for End of Service Benefit (EoSB) schemes in the Middle East, an area which is currently undergoing tremendous change and which is certainly generating more attention from both the private and the public sectors. In a nutshell, we help HR and finance departments across the region to best utilize one of the largest cash payments to employees – the end of service benefit – to help deliver on the HR objective of retaining talent and improving employee performance and productivity.

Tell us about your background

I started my career with SHUAA Capital where I focused on Investment Banking for five years and I was responsible for the execution and distribution of the Bank’s IPO and Private Placement mandates in the GCC and abroad. I then moved on to Emirates NBD Asset Management, where I spent two years overseeing the distribution of the bank’s range of Equity, Fixed Income and Alternative Asset Funds to the bank’s clients, before joining SEI Investments in 2013.

What is the best End Of Service Benefits (EoSB) for employees strategy you have implemented?

One of the best plans we implemented was for a UAE based employer with a large employee base. This was a rare case of an employer that recognized the effectiveness of a benefit system that rewarded long tenure with enhancements to EoSB. Employees were already receiving a significant uplift to their End of Service benefits, which was as high as double the amount mandated by law, after a certain length of service. The issue was, the majority of employees were not aware of this benefit – either because they did not know it existed or because they were not aware how much higher the payout was than the legal minimum required by the labor law. They only became aware of this benefit once they left!

So despite creating a unique benefit, the employer was not effectively generating the goodwill and standing out amongst the competition as a favorable employer. We were brought on board to help rectify the problem they were facing, in-spite of having an EoSB plan in place.

Can you take us step-by-step why it was a success?

The first step was to establish a communication plan so that employees knew what their EoSB entitlements where and how much better off they were with this employer than they would have been with an employer who simply paid the legal minimum required by the labor law. This was done through establishing a personalized web portal for each employee where they could see what this benefit was at any time.

In addition, we established a savings plan where employees could make monthly contributions from their salary into investment funds. Using the same portal, employees could view their savings plan contributions, review investment performance, and download plan rule booklets and application forms. The employer then set up a matching program for high performers, so employees who passed certain performance measures at their appraisal were rewarded whereby the employer matched a certain percentage of the employees’ contribution into the savings plan.

What this achieved was a differentiated model of reward, where employees who performed well and remained loyal were the best rewarded. Additionally, it helped employees build a savings culture through the financial self-discipline promoted by regular savings contributions.

The most important result for the employer was a dramatic improvement in their retention rates, particularly among their high performing employees who had been regularly poached by international competitors in their sector.

How does your company help organizations?

SEI runs some of the biggest pension schemes in the world today. We have leveraged our global capabilities to provide a solution to MENA based employers that cater to their unique needs around End of Service benefits.

The majority of the work we do is centered on the management of end of service funds to ensure employees’ gratuity is secured and that companies will not only afford making this payment, but can also use it as leverage to help companies improve dollar cost productivity and retain talent.

A well run scheme is based on separation of the asset from the balance sheet, establishment of a risk management framework, asset allocation program, investment implementation, and administrative and reporting services to provide oversight of the whole EoSB Scheme.

How can our readers find out more about SEI Investments?

For more information, readers can visit seic.com. I would encourage all HR professionals and company leaders to subscribe to our newsletter and follow our research and studies for the latest information on the management of EoSB schemes.

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