1. © Prentice-Hall, Inc., 2001 Chapter Eleven Discretionary Benefits

2. © Prentice-Hall, Inc., 2001 Table 11-3 The General Characteristics of Qualified Pension Plans (1 of 2) l Eligibility »Employers may impose any initial eligibility but for those that pertain to age or service. No minimum age over 21 can be required, nor can more than one year of service be required for eligibility. l Nondiscrimination »Employers cannot provide highly compensated employees (for example, vice presidents, chief executive officers) with preferential treatment with regard to employer contributions to the plans or the level of benefits received unless the employer contributions or benefit levels are based solely on employees’ compensation level or years of service.

3. © Prentice-Hall, Inc., 2001 Table 11-3 The General Characteristics of Qualified Pension Plans (2 of 2) l Vesting Requirements »Employers must provide employees with a nonforfeitable right to the funds they contribute to the plans on behalf of their employees after a specified period, commonly five years. For example, employees who terminate their employment after five years maintain the right to the funds contributed on their behalf by the employer. However, employees who terminate their employment before the five- year period forfeit the right to the funds contributed on their behalf by the employer. l Payout Restrictions »Employees generally pay a penalty (usually 10 percent) on withdrawal of funds from any qualified plan before early retirement age (59 1/2 years).

4. © Prentice-Hall, Inc., 2001 Table 11-4 U.S. Health Care Expenditures, 1960 to 1999 (1 of 3) YEAR 1960 1965 1970 1971 1972 1973 1974 1975 1976 PRIVATE TOTAL (BILLIONS OF DOLLARS) PER CAPITA (DOLLARS) PRIVATE TOTAL HEALTH SERVICES AND SUPPLIES (BILLIONS OF DOLLARS) 27.1 41.6 74.3 82.2 92.3 102.4 115.9 132.6 151.9 143 204 346 379 421 464 521 591 671 19.8 29.9 44.0 48.1 53.9 59.7 65.9 74.1 85.7 5.7 8.3 25.0 28.2 31.8 35.9 42.8 50.2 56.9

5. © Prentice-Hall, Inc., 2001 Table 11-4 U.S. Health Care Expenditures, 1960 to 1999 (2 of 3) YEAR 1977 1978 1979 1980 1981 1982 1983 1984 1985 PRIVATE TOTAL (BILLIONS OF DOLLARS) PER CAPITA (DOLLARS) PRIVATE TOTAL HEALTH SERVICES AND SUPPLIES (BILLIONS OF DOLLARS) 172.6 193.2 218.3 251.1 291.4 328.2 360.8 396.0 434.5 755 836 937 1,068 1,227 1,369 1,490 1,620 1,761 96.6 109.7 124.0 141.3 164.3 186.5 205.3 228.0 252.9 64.7 73.6 84.0 96.1 113.9 126.9 139.5 151.6 165.2

6. © Prentice-Hall, Inc., 2001 Table 11-4 U.S. Health Care Expenditures, 1960 to 1999 (3 of 3) YEAR 1990 1995 1996 1997 1998 1999 (est.) PRIVATE TOTAL Source: US Health Care Financing Admin., Health Care Financing Review (Winter 1994); Table 150. U.S. Health Care Financing Administration, Office of the Actuary: National Health Statistics Group (1999). [Online] http://www.hcfa.gov/stats. TOTAL (BILLIONS OF DOLLARS) PER CAPITA (DOLLARS) PRIVATE TOTAL HEALTH SERVICES AND SUPPLIES (BILLIONS OF DOLLARS) 699.4 993.3 1,039.4 1,088.2 1,149.1 1,228.5 2,689 3,637 3,772 3,912 4,094 ----- 416.2 537.3 559.0 586.0 626.4 ----- 283.2 456.0 480.4 502.2 522.7 -----

7. © Prentice-Hall, Inc., 2001 Table 11-6 Pay for Time-Not-Worked Practices in Medium and Large Private Establishments, 1997 BENEFIT Holidays Vacation Personal leave Jury duty Funeral leave Military leave AVERAGE AMOUNT PERCENT OF FULL-TIME EMPLOYEE RECIPIENTS 96 14 90 85 57  11 days per year Depends on tenure  days per year No stated maximum  days per year  days per year Source: US Bureau of Labor Statistics, Employee benefits in medium and large private establishments, 1997 (Washington, D.C.: US Government Printing Office, 1999).