Employee benefits planning is essential to establishing your company in a new country. When your company grows in Jordan, you’ll face a series of requirements and employee expectations that will guide your planning process.
Employee benefits plan in Jordan
Benefits planning can be a valuable aspect of your growth strategy. When you begin recruiting, these provisions can draw in job seekers and help you build your team faster. Once you’ve hired your employees, benefits can increase retention rates, helping to reduce onboarding costs and create an experienced workforce. Possible benefits include:
- Private health insurance
- Holiday bonuses
- Pension schemes
- Transportation allowances
Mandatory benefits in Jordan
Benefits are also essential to compliance. The country’s labor laws require employees to give their employees specific provisions, including:
- Paid annual leave
- Paid sick leave
- Paid maternity leave
- Social security contributions
Designing Jordan employee benefits plans
It’s essential to approach the design process with an organized mindset to ensure you address every need. Requirements will vary from one country to another, but you can create a plan using the same fundamental steps anywhere in the world.
1. Evaluate your finances
Determine how much you’re willing to spend before you start adding provisions to your plan. Consider your revenue and existing expenses to see how benefits fit in.
2. Research the market
Learn about the labor market to compete within it. Research different companies and their benefits packages to find out which provisions are commonly offered.
3. Select benefits
Allocate your funding to required provisions first, then use your remaining budget for supplemental benefits and perks.
Average cost of benefits
Guiding your planning with an average market cost may not be the most beneficial method. Employers can pay drastically different amounts for benefits, which can skew the metric. Factors such as business size, location, and industry will influence how much a company is willing to pay for its benefits plan.
Instead of relying on an overall average, set a budget unique to your earnings. The best strategy is to allocate a percentage of your revenue. This way, your budget will scale with your company as it grows.
How to calculate employee benefits
Calculations for benefits vary based on the type of provision. Many allowances and bonuses come with straightforward calculations — you set a monetary amount and distribute it accordingly. Other benefits, such as company cars, are more complex. In the case of a car, you may choose to set a monthly mileage limit and fuel expense to manage costs.
The labor laws provide guidance on how to calculate required benefits such as maternity and annual leave pay. Among these required provisions are social security benefits. Rather than a set amount, these contributions are based on a percentage. Employees must pay 7.5 percent of their salaries, and employers pay 14.25 percent of employees’ wages.
How are employee benefits taxed in Jordan?
Income tax applies to all salaries, allowances, wages, and bonuses — whether in cash or in kind. Employers should determine estimated annual values for benefits in kind to define employee income and deduct the appropriate amount for taxes.
Employee health benefits
In Jordan, the government and social security contributions support the public healthcare system to give people free and low-cost care. Employers are responsible for making these social security contributions. Private health insurance is not required, but employers can offer it as a supplemental benefit.
Choose G-P for employee benefits planning in Jordan
G-P’ global employment platform helps you build and scale an international team quickly and easily, ensuring all benefits offered to candidates are compliant and in line with local regulations. Learn more about our platform and request a proposal today.