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Chapter 13. Benefits and Services. Name and define each of the main pay for time not worked benefits. Describe each of the main insurance benefits. Discuss the main retirement benefits. Outline the main employees’ services benefits. Explain the main flexible benefit programs.

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Chapter 13

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Chapter 13 l.jpg

Chapter 13

Benefits and Services

  • Name and define each of the main pay for time not worked benefits.

  • Describe each of the main insurance benefits.

  • Discuss the main retirement benefits.

  • Outline the main employees’ services benefits.

  • Explain the main flexible benefit programs.


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The Benefits Picture Today

Benefits

  • Indirect financial and nonfinancial payments employees receive for continuing their employment with the company


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The Benefits Picture Today

Which benefits to offer

Who will be covered

Whether to include retirees

Coverage during probation

Policy Issues

How to finance benefits

Degree of employee choice

Cost containment procedures

Communicating benefits options


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Pay for Time Not Worked

Supplemental Pay Benefits

Benefits for time not worked such as unemployment insurance, vacation and holiday pay, and sick pay

Unemployment Insurance

Provides for benefits if a person is unable to work through no fault of his or her own

Vacations and Holidays

Paid vacation days and holidays given by employer

Sick Leave

Provides pay to an employee when he or she is out of work because of illness

Parental Leave and FMLA

Such as pregnancy and maternity leave

Severance Pay

A one-time payment when terminating an employee

Supplemental Unemployment Benefits

The employer makes contributions to a reserve fund from which SUB payments are made to employees for the time the employee is out of work due to layoffs, reduced workweeks, or relocations


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Insurance Benefits

Workers’ Compensation

Provides income and medical benefits to work-related accident victims or their dependents, regardless of fault

How benefits are determined – The ADA – Controlling workers’ compensation cost – Case management

Hospitalization, Health, and Disability Insurance

Provide for loss of income protection and group-rate coverage of basic and major medical expenses for off-the-job accidents and illnesses

Health Maintenance Organization (HMO)

A medical organization consisting of specialists operating out of a community-based health care center. Which provides routine medical services to employees who pay a nominal fee.

Preferred Provider Organizations (PPOs)

Groups of health care providers that contract to provide services at reduced fees

Mental Health Benefits

Used to deal with mental illnesses


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Insurance Benefits

Trends in Health Care Cost Control

Communication, involvement, and empowerment

Premiums and co-pays

Prevention programs

Health savings accounts

Claim audits

Other cost control options


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Insurance Benefits

Long Term Care

Nursing assistance for former employees

Life Insurance

Group life insurance or accidental death and dismemberment

Group Life Insurance

Provides lower rates for the employer or employee and includes all employees

Benefits for Part Time and Contingent Workers

Up to what extent its important?


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Retirement Benefits

Social Security

A federal program provides benefits as retirement benefits at the age of 62. Also, survivor’s or death benefits paid to the employee’s dependents. In addition to disability payments to disabled employees and their dependents

Pension Plans

Plans that provides a fixed sum when employees reach a predetermined retirement age or when they can no longer work due to disability

Defined Benefits Pension Plans

A plan that contains a formula for determining retirement benefits

Defined Contribution Pension Plans

A plan in which the employer’s contribution to employees’ retirement saving funds is specified

Portability

Instituting policies that’s enable employees to easily take their accumulated pension funds when they leave employer

401 (k) Plans

Defined contribution plans based on section 401(k) of the Internal Revenue Code.


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Retirement Benefits

Pension Plans

Plans that provides a fixed sum when employees reach a predetermined retirement age or when they can no longer work due to disability

Defined Contribution Pension Plans

A plan in which the employer’s contribution to employees’ retirement saving funds is specified

Saving and Thrift Plan

Employees contribute a portion of their earnings to a fund; the employer usually matches this contribution in whole or in part

Deferred Profit Sharing Plan

Employers contribute a portion of profits to the pension fund, regardless of the level of employee contribution

Employees Stock Ownership Plan (ESOP)

Qualified, tax-deductible stock bonus plans in which employers contribute company stock to a trust for eventual use by employees

Cash Balance Plans

Defined benefit plans under which the employer contributes a percentage of employees’ current pay employees’ pension plans every year, and employees earn interest on this amount


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Retirement Benefits

Pension Planning and the Law

Law impact on pension planning

Employee retirement income security act (ERISA)

Pension benefits guarantee corporation (PBGC)

Membership requirements

Vesting vested funds (Money placed in pension fund that cannot be forfeited for any reason)

Benefit formula

Plan funding


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Retirement Benefits

Early Retirement

Employees retired before retiring date

Early Retirement Window

A type of offering by which employees are encouraged to retire early, the incentives being liberal pension benefits plus perhaps a cash payment

Phased Retirement and the Aging Workforce

What is phased retirement programs?

Improving Productivity Through HRIS: Benefits Management Systems


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Personal Services and Family Friendly Benefits

Personal Services

Benefits provided to employees voluntarily

Credit Unions - Employee Assistance Programs

Family – Friendly Benefits

Benefits such as child care and fitness facilities that make it easier for employees to balance their work and family responsibilities

Subsidized child care – Sick child benefits – Elder care – Time off … etc.

What is the effect on performance?

Other Job Related Benefits

Educational subsidies

Executives Perquisites

Examples and Use


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Flexible Benefits Programs

The Cafeteria Approach / Flexible Benefits Plans

Each employee is given a benefits fund budget to spend on the benefits he or she prefers

Flexible Spending Accounts

Enable employees to pay for medical and other expenses with pretax dollars by depositing funds in their accounts from payroll deductions

Flexible Work Arrangements

Types

Flextime

A work schedule in which employees’ workdays are built around a core of mid-day hours when all workers are required to be present

Compressed Workweek

A work schedule in which employee works fewer but longer days each week

What is the effectiveness of flextime and compressed workweek programs?

Other Flextime Work Arrangements

Job sharing – Work sharing - Telecommuting


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