November 5, 2021

The Cost Breakdown: Implementing An EAP in Malaysia and Your Bottom Line

If you are a business owner or HR professional, you may be weighing the pros and cons of an employee assistance program (EAP) sometimes referred to as a corporate wellness program. 

Arguably, the cost of implementing an EAP is of the greatest concern. 

Rather than give you a list of numbers on the price of specific programs offered by various companies in Southeast Asia, allow me to give you a framework for deciding the cost effectiveness of an employee assistance program in Malaysia. 

Instead of beginning with the cost of services, let’s begin by looking at the cost burden of employee mental health concerns as this is the very thing a corporate wellness program is designed to mitigate.

The Cost Burden of Employee Mental Health Concerns

Mental Health Concerns Reduces Workplace Engagement

When employees are coping with a mental health condition, they will more than likely be less engaged in the task at hand, as their mind is preoccupied with their personal struggle.

Stress, whether it is from an employee’s personal life or related to the workplace directly, will inevitably reduce productivity merely from a lack of focus while present. 

One study looking specifically at work engagement among Malaysian employees found psychological distress was one of three factors associated with poorer work engagement. 

Less engagement translates to less productivity! 

Stress Increases Employee Absenteeism

When an employee is absent productivity is either 1) halted or 2) a temporary replacement is called in who is likely less productive than a regular employee. 

What causes employees to take days off?

One of these reasons is stress. If employees are under stress, and particularly if this stress is exacerbated by demands in the workplace, they may be more likely to request time off. Stress can easily manifest in physical symptoms which also may lead to additional sick days.

A BMC Public Health study found that mental health, specifically stress, was one of the greatest influences of absenteeism. 

Greater absenteeism translates to less productivity!

Stress Leads to Costly Workplace Accidents 

Multitasking, especially while working, is a recipe for disaster!

It is difficult for employees to perform optimally if a concern is vying for their mental capacity. Stress from personal lives or the workplace leads to divided attention and reduced focus. 

A study in WORK: A Journal of Prevention, Assessment & Rehabilitation suggests that 60-80% of workplace accidents are stress related. 

Workplace accidents translates to not only less productivity but also cost for medical 

Mental Health Concerns Lower Retention Rates 

We know the difficulty in retaining top talent in the workplace. Job satisfaction is one of the greatest reasons why employees stay in a position or with the same company. 

We know that mismanaged stress or concern over personal matters does not lead to job satisfaction. Work becomes even more stressful when employees are concerned about how their stress is impacting their job performance. 

Not only do managers lose productivity each time they have to train a new hire, but it takes time for a new employee to learn the ropes and become proficient and highly productive at their job. 

Low retention rates and high turnover translates to reduced productivity and additional costs!

Mismanaged Mental Health Concerns Increase Healthcare Cost

In general, health insurance premiums are calculated based on average medical care usage. If your business provides health insurance benefits to your employees, you are already spending money on medical expenses for your employees. 

If your employees are struggling with stress and/or other mental health conditions that are affecting their physical health, it is likely that the cost of medical insurance is going to continue to rise for your company. 

Unaddressed or mismanaged mental health concerns translate to increased healthcare costs!

Delayed Intervention in Mental Health Concerns Costs More 

As is the case with most things, early intervention is always best!  And the same applies in the case of mental health!

The danger comes in waiting until an employee needs to take a leave of absence or can no longer function effectively or efficiently in their current role. Paying for time off, training a replacement, or hiring a new employee takes time, money, and energy (productivity). 

Delayed intervention in mental health translates to less productivity and increased costs!

The Cost Effectiveness of an Employee Assistance Program

Now that we have addressed the negative costs of unaddressed mental health concerns in the workplace, let’s look at the positive effects of an employee assistance program on your business’ bottom line!

Stress Management Prevents a Decline in Productivity

A corporate wellness program can provide stress management courses to help employees cope with workplace demands and/or concerns in their personal lives.

By providing preventive intervention and/or access to these services as soon as an issue arises, you can potentially stave off a significant reduction in your business’ productivity and even increase productivity from the current level.

The stress management services provided by an EAP translates to increased productivity!

Mental Health Intervention Improves Employee Engagement and Productivity

When stress is well managed, however, employees are more likely to be present and engaged in their work and work at full productivity. 

A corporate wellness program can assist employees by providing counseling services and strategies to manage stress. 

Other benefits of an employee assistance program in Malaysia include access and/or referrals to needed services in order to address the root cause of employee stress (e.g. access to legal counsel). 

Corporate Wellness Programs Improve Job Satisfaction and Improve Retention Rates

Retaining qualified employees keeps productivity high and costs associated with hiring and training low. 

Since we know the effect that job satisfaction has on employee retention, let’s look at how an EAP can help boost job satisfaction:

  • Helps manage stress that gets in the way of enjoying a job to the fullest
  • Provides access to additional benefits, outside of traditional healthcare coverage, that can have a huge impact on employee’s quality of life
  • Let’s employees know that the organization cares about their flourishing as an individual and an employee
  • Helps mitigate workplace conflict for better relationships with coworkers and management

Greater job satisfaction translates to higher productivity and lower costs!

EAP Research Indicates an Increase in Your Bottom Line

You may be concerned that the cost of a corporate wellness program will outweigh the benefits even if it continues to increase your business’ productivity but let me show you what the data suggests. 

According to the Employee Assistance Trade Association, an EAP should provide RM 3 for each RM 1 spent on the program.

Not only does this program eventually pay for itself, it actually increases your bottom line as employee productivity increases.

What Is The Next Step?

Now that you understand the detrimental costs of unaddressed mental health concerns in the workplace and how an employee assistance program can mitigate those costs and increase productivity for your company, what’s next?

You can take the first step to start a corporate wellness program (EAP) today by reaching out to one of the many EAP providers in Malaysia and tailoring a program to specifically fit the needs of your company. 

The following are potential services that can be offered via a corporate wellness program or an EAP:

  1. Mental Health Awareness Training
  2. Mental Health Counseling
  3. Counseling for marriage, family, and/or financial struggles
  4. Treatment for substance abuse
  5. Workplace Conflict Resolution
  6. Childcare and Eldercare Navigation
  7. Wellness Programs
  8. Legal Guidance
  9. Emergency Hotline

Your business may only need a few of these services and that’s okay. When contracting with a company, you can typically pick and choose the services your company will need. 

Among the many great services that an EAP in Malaysia can provide for your company, here are a few that make Solace Wellness stand out from the rest:

  • Employees have access to a 24-7 hotline and can begin counseling services within 24 hours. 
  • Solace has affiliations with psychiatrists and can administer mental health assessments.
  • Solace counselors accept referrals for clients for long term counseling sessions. 
  • Solace counselors are multilingual and can provide services in all major languages in Malaysia. 
  • Solace’s referral network of service providers spans across the country and is not limited to just the Klang valley.

What prevents you from picking up the phone and taking that first step today?