9 Employee Benefits and Allowances to Attract and Retain Talent in Malaysia

What are Employee Benefits？

Employee benefits in Malaysia typically refer to non-wage compensation provided to employees in addition to their regular salary or wages. These benefits are provided by employers as part of a total compensation package to attract and retain talent and promote employee well-being and job satisfaction. The specific benefits offered may vary depending on the employer, industry and terms of employment.

Why are Employee Benefits Important?

Companies should provide employee benefits for several reasons:

1. Competitive Advantage: In a competitive job market, offering attractive benefits sets employers apart from their competitors. Prospective employees often compare benefits packages when evaluating job offers, and a comprehensive benefits package can be a decisive factor in attracting top talent.
2. Talent Acquisition: Companies that offer desirable benefits are more likely to attract qualified candidates who possess the skills and experience needed for the job. This enhances the recruitment process by expanding the pool of potential candidates and increasing the likelihood of hiring the best-fit individuals.
3. Employee Value Proposition (EVP): A strong benefits package forms a key component of the Employee Value Proposition (EVP) – the total rewards offered by an employer in exchange for the skills, capabilities, and experience that employees bring to the organization. A compelling EVP enhances employer branding and reinforces the company's reputation as an employer of choice.
4. Retention and Loyalty: Beyond attracting talent, comprehensive benefits also contribute to employee retention. When employees feel valued and supported through benefits such as healthcare coverage, retirement plans, and professional development opportunities, they are more likely to remain with the company for the long term. This reduces turnover rates and associated costs while fostering a loyal and committed workforce.
5. Perceived Value: Offering desirable benefits communicates to prospective employees that the company values their well-being, recognizes their contributions, and is committed to supporting their growth and success. This perception of value enhances the employer's attractiveness and can positively influence candidates' decisions to join the organization.
6. Enhancing Employer Branding: A strong benefits package enhances the company's employer brand and reputation as an employer of choice. This attracts not only top talent but also customers, investors, and other stakeholders who value companies that prioritize their employees' welfare.

What are the Mandatory Employee Benefits in Malaysia?

In Malaysia, there are several mandatory benefits that employers are required to provide to their employees, as mandated by labor laws and regulations. These mandatory benefits include:

1. Employees Provident Fund (EPF)
2. Social Security Organization (SOCSO)
3. Workmen's Compensation Insurance
4. Annual Leave
5. Public Holidays
6. Sick Leave
7. Maternity/Paternity Leave
8. Termination and Retrenchment Benefits

4 Extra Benefits Attract and Retain Employees the most

• Insurance (medical, life, dental, or optical)
• Additional paid leave
• Remote working
• Flexible work hours

5 Extra Allowances Attract and Retain Employees the most

• Travel and Transportation Allowances

To help employees manage their commuting costs, companies often provide a petrol or transportation allowance, ensuring punctuality and reducing employee stress.

• Housing Allowances

Housing allowance helps employees afford comfortable accommodation closer to their workplace, reducing commute times and improving work-life balance.

• Meal and Food Allowances

For employees who spend long hours at the office, meal allowances are a welcome relief. These allowances cover the cost of meals during work hours, ensuring that employees have access to nutritious food without worrying about the expense.

• Health and Wellness Allowances

To support the physical health of employees and demonstrate the company’s commitment to their overall well-being, companies can provide benefits such as medical insurance, gym memberships, and wellness programs.

• Professional Development Allowances

It provide employees with the opportunity to attend training, workshops, or courses that enhance their skills and career prospects. It's a win-win for the organization as well, with improved talent helping to better achieve business objectives and goals.

The Employee Benefits Offered by Shell, Nestle, and Intel Have in Common

The top 3 winners of the 2021 Most Attractive Employer Awards are Shell, Nestle and Intel.

So, what are the employee benefits that these three companies have in common to attract employees?

Health and Wellness:

• Medical insurance
• Dental allowance
• Vision allowance
• Life insurance
• Disability insurance
• Mental healthcare
• Gym membership
• Sports facilities

Financial and Retirement:

• Car allowance
• Housing allowance
• Pension plan
• Retirement plan
• Performance bonus
• Company stock options

Family & Parenting:

• Mother's room
• Maternity and paternity leave
• Extended maternity leave
• Compassionate leave

Vacation & Time off:

• Sabbatical leave
• Paid leave
• Sick leave
• Volunteer time off
• Hospitalization leave
  

Perks and Discounts:

• Employee discount
• Flexible work hours
• Part-time work
• Remote work
• Company social events
• Casual dress code

The Unique Employee Benefits provide by Shell, Nestle, and Intel

Shell:

• Career break
• Working beyond retirement age
• Childcare support subsidy
• Half pay leave
• Leave bank
• Unpaid leave up to 3 months
• Mobile phone discount

Nestle:

• Company car
• Free flow of foods and drinks (including ice creams!)
• 13th-month salary
• Infant feeding scheme

Intel:

• Prepaid Legal
• Severance pay
• Profit sharing
• Additional employer EPF
• Wellness coaching
• Free health checks
• Maternity expenses subsidy
• Travel discounts
• Examination leave
• Convocation leave
• Marriage leave
• Tertiary education subsidy (employee's children)

Tax-exempt Allowances in Malaysia

It’s important to note that some allowances in Malaysia are tax-exempt, providing further financial benefits to employees — while others are not.

The tax-exempt allowances include:

• Childcare allowance
• parking allowance
• Traveling and Petrol allowance
• Meal allowance
• Monthly internet/phone bills
• Subsidized Loans (internal and external funds)
• Insurance premiums
• Professional subscriptions
• Scholarship
• Gift of phone/tablet
• Gift vouchers
• Pure gifts
• Rewards related to employment

Read More on Ajobthing : 

• Finding the Perfect Fit: 5 Personality Tests for Hiring Process
• 6 Key Hiring Trends Shaping Malaysia
• Optimizing Your Workforce: Hiring Part-Time Employees in Malaysia
• 7 Simple Ways to Improve Employee Performance with KPIs
• Understanding Form E: A Comprehensive Guide to E-Filing Submission

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