Before we delve into the many advantages of a balanced employee benefits package, we would like to explain exactly what this term means. Employee benefits, in practice often abbreviated to EB, include a wide range of personnel benefits or extra-statutory benefits that reflect your corporate culture. The most common are:
- Company cars
- Electronic devices such as laptops and mobile phones
- Insurance such as hospitalisation insurance
However, costs such as ambulatory care, dental care, guaranteed income or a supplementary pension plan can also be part of an employee benefits package.
Extra-statutory benefits are often attractive from a tax viewpoint and put you as an organisation in a strong position in the war for talent. They are therefore an ideal way for employers to diversify on the labour market. In most cases they are also a far better option for employers and employees than paying extra salary.
Studies show that many Belgians overestimate the value of the statutory pension. Did you know that the average statutory pension after a full career is just 45-50% of your final salary?
That makes a supplementary pension an important – but still often underestimated – addition to the statutory pension. This extra-statutory benefit is an additional capital sum that your employees can build up through your organisation’s group insurance and receive on top of the statutory pension when they retire.
Supplementary pensions are subject to a mandatory minimum return. If this is not achieved, it is up to you as an employer to make a top-up payment to ensure that your employees don’t receive less than the minimum. Given that the minimum return will increase from 1.75% to 2.50% on 1 January 2025, this is the ideal time to take a closer look at your supplementary pension plan.
As a caring employer, you want to provide a meaningful supplementary pension for your personnel. If you have the financial room for manoeuvre, opt for a 3% supplementary pension instead of 1%. This will make a significant difference to every employee on retirement, especially if you take into account the rising cost of living.
Tip: it’s a good idea to communicate regularly and transparently about this cover. A supplementary pension is as valuable for school-leavers as it is for more seasoned employees. Because retirement is still a long way off for some, they tend to overlook and therefore fail to fully appreciate this benefit.
The retirement age in Belgium will rise over the next few years, to 66 in 2025 and 67 from 2030 onwards. Payouts are currently based on a retirement age of 65 in most insurance policies. These changes therefore raise many insurance- and non-insurance-related questions for both employers and employees. How can you anticipate these changes as an employer? And what action or actions should you or can you take to ensure all your employees remain well protected?
You can opt to align your various insurance policies with the rising statutory retirement ages. Naturally, if you extend the age until which benefits can be received, the insurance premium will increase too. If you do not do so, you run the risk of discriminating within your current workforce. For example, a 66-year-old employee will suddenly be without cover if he is absent for a long period due to illness, while a 35-year-old employee in the same situation will be covered.
Given that we will all have to work for longer, the importance of good mental and physical health for your employees will become even greater in the years to come. As an employer, it pays to invest in preventive health initiatives and
reintegration programmes.
