Presentation on theme: "Chapter 13 Benefits and Services"— Presentation transcript:
1 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.
2 The Benefits Picture Today Indirect financial and nonfinancial payments employees receive for continuing their employment with the company
3 The Benefits Picture Today Benefits Required by Federal or Most State LawBenefits Discretionary on Part of Employer*Social SecurityUnemployment InsuranceWorkers’ CompensationLeaves under the Family Medical Leave ActDisability, Health, and Life InsurancePensionsPaid Time Off for Vacations, Holidays, Sick Leave, Personal Leave, Jury Duty, etc.Employee Assistance and Counseling Programs“Family Friendly” benefits for Child Care, Elder Care, Flexible Work Schedules, etc.Executive PerquisitesWhich benefits to offerWho will be coveredWhether to include retireesCoverage during probationPolicy IssuesHow to finance benefitsDegree of employee choiceCost containment proceduresCommunicating benefits options
4 Supplemental Pay Benefits Pay for Time Not WorkedSupplemental Pay BenefitsBenefits for time not worked such as unemployment insurance, vacation and holiday pay, and sick payUnemployment InsuranceProvides for benefits if a person is unable to work through no fault of his or her ownVacations and HolidaysPaid vacation days and holidays given by employerSick LeaveProvides pay to an employee when he or she is out of work because of illnessParental Leave and FMLASuch as pregnancy and maternity leaveSeverance PayA one-time payment when terminating an employeeSupplemental Unemployment BenefitsThe 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
5 Insurance Benefits Workers’ Compensation Provides income and medical benefits to work-related accident victims or their dependents, regardless of faultHow benefits are determined – The ADA – Controlling workers’ compensation cost – Case managementHospitalization, Health, and Disability InsuranceProvide for loss of income protection and group-rate coverage of basic and major medical expenses for off-the-job accidents and illnessesHealth 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 feesMental Health BenefitsUsed to deal with mental illnesses
6 Insurance Benefits Trends in Health Care Cost Control Communication, involvement, and empowermentPremiums and co-paysPrevention programsHealth savings accountsClaim auditsOther cost control options
7 Insurance Benefits Long Term Care Nursing assistance for former employeesLife InsuranceGroup life insurance or accidental death and dismembermentGroup Life InsuranceProvides lower rates for the employer or employee and includes all employeesBenefits for Part Time and Contingent WorkersUp to what extent its important?
8 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 dependentsPension PlansPlans that provides a fixed sum when employees reach a predetermined retirement age or when they can no longer work due to disabilityDefined Benefits Pension PlansA plan that contains a formula for determining retirement benefitsDefined Contribution Pension PlansA plan in which the employer’s contribution to employees’ retirement saving funds is specifiedPortabilityInstituting policies that’s enable employees to easily take their accumulated pension funds when they leave employer401 (k) PlansDefined contribution plans based on section 401(k) of the Internal Revenue Code.
9 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 disabilityDefined Contribution Pension PlansA plan in which the employer’s contribution to employees’ retirement saving funds is specifiedSaving and Thrift PlanEmployees contribute a portion of their earnings to a fund; the employer usually matches this contribution in whole or in partDeferred Profit Sharing PlanEmployers contribute a portion of profits to the pension fund, regardless of the level of employee contributionEmployees Stock Ownership Plan (ESOP)Qualified, tax-deductible stock bonus plans in which employers contribute company stock to a trust for eventual use by employeesCash Balance PlansDefined 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
10 Retirement Benefits Pension Planning and the Law Law impact on pension planningEmployee retirement income security act (ERISA)Pension benefits guarantee corporation (PBGC)Membership requirementsVesting vested funds (Money placed in pension fund that cannot be forfeited for any reason)Benefit formulaPlan funding
11 Improving Productivity Through HRIS: Benefits Management Systems Retirement BenefitsEarly RetirementEmployees retired before retiring dateEarly Retirement WindowA type of offering by which employees are encouraged to retire early, the incentives being liberal pension benefits plus perhaps a cash paymentPhased Retirement and the Aging WorkforceWhat is phased retirement programs?Improving Productivity Through HRIS: Benefits Management Systems
12 Personal Services and Family Friendly Benefits Benefits provided to employees voluntarilyCredit Unions - Employee Assistance ProgramsFamily – Friendly BenefitsBenefits such as child care and fitness facilities that make it easier for employees to balance their work and family responsibilitiesSubsidized child care – Sick child benefits – Elder care – Time off … etc.What is the effect on performance?Other Job Related BenefitsEducational subsidiesExecutives PerquisitesExamples and Use
13 Flexible Benefits Programs The Cafeteria Approach / Flexible Benefits PlansEach employee is given a benefits fund budget to spend on the benefits he or she prefersFlexible Spending AccountsEnable employees to pay for medical and other expenses with pretax dollars by depositing funds in their accounts from payroll deductionsFlexible Work ArrangementsTypesFlextimeA work schedule in which employees’ workdays are built around a core of mid-day hours when all workers are required to be presentCompressed WorkweekA work schedule in which employee works fewer but longer days each weekWhat is the effectiveness of flextime and compressed workweek programs?Other Flextime Work ArrangementsJob sharing – Work sharing - Telecommuting