Post on 05-Apr-2018
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1. Define each of the main pay for time notworked benefits
2. Describe each of the main insurance benefits
3. Discuss the main retirement benefits
4. Outline the main employees services benefits
5. Explain the main flexible benefitprograms
6. Discuss benefits provided bycompanies inAsia
2009 Pearson Education South Asia PteLtd. All rights reserved. 132
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Four main types of plans:1.Supplemental pay benefits
2.Insurance benefits
3.Employee services
4.Retirement benefits
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Benefits Indirect financial and non-financial payments
employees receive for continuing theiremployment with the company.
Types of employee benefit plans Pay for time not worked
Insurance benefits
Retirement benefits Services and family-friendly benefits
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Also known as supplemental paybenefits
Examples include:
Holidays
Sick leave
Parental leave
Proper leave records should be keptby employers
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Unemployment Insurance : Provides benefits if a person is unable to work through
some fault other than his or her own.
Vacation and holiday Number of paid vacation days varies by country.
Sick leave Provides pay to an employee when he or she is out of
work because of illness.
Parental leave Important benefit especially where many workers are
females with children
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Severance pay
A one-time payment when terminating anemployee.
Reasons for granting severance pay: Acts as a humanitarian gesture and good public
relations.
Mirrors employees two week quit notice.
Avoids litigation from disgruntled former employees.
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Workers compensation (monetary ormedical) Provides income and medical benefits to work-
related accident victims or their dependents,regardless of fault.
Death or disability: a cash benefit based on priorearnings.
Controlling worker compensation costs
Screen out accident-prone workers. Make the workplace safer. Thoroughly investigate accident claims. Use case management to return injured employees
to work as soon as possible.
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Hospitalization, health, and disabilityinsurance
Protects employees against hospitalization costs
and loss of income arising from off-the-jobaccidents or illness.
Accidental death .
Disability insurance
Insurance for health-related expenses
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Health maintenance organization(HMO)
A medical organization consisting of specialists
operating out of a community-based health carecenter.
Provides routine medical services to employees whopay a nominal fee.
Receives a fixed annual contract fee per employeefrom the employer (or employer and employee),regardless of whether it provides that person withservice.
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Life insurance
Most employers provide group lifeinsurance plans.
Employees can obtain lower rates in agroup plan.
Employer usually pays 100 percent of
the base premium; the employee paysfor any additional coverage.
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Pension plans Financial programs that provide a fixed amount
when employees reach a predeterminedretirement age or when they can no longer workdue to disability.
Defined Benefit pension plan:A plan that contains a formula for determiningretirement benefits
Defined Contribution Plans:A plan in which the employers contribution toemployees retirement savings funds is specified.
Portability: Instituting policies that enableemployees to easily take their accumulatespension funds when they leave employer.
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Social security plans Vary from country to countryBroadly 3 types of benefits
Retirement income
Survivors or death benefits payable to the
employees dependents regardless of age at thetime of death
Disability benefits payable to disabled employeesand their dependants.
Only if insured under Social security Act.
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Personal services: Social and recreational facilities
Transport and food:
Subsidies, in-house canteens, company vehicles Education subsidy:
Tuition refunds
Family-friendly benefits:
Child care, elder care, fitness facilities, flexiblework schedules
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The cafeteria (flexible benefits)approach
Each employee is given a benefits fund budget to
spend on the benefits he or she prefers.
The fund limits the total cost for each benefitspackage.
Core plus option plans establish a core set ofbenefits which are mandatory for all employees.
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The cafeteria (flexible benefits)approach (contd)
Pros
Employees can choose the package that suits thembest
Easier to introduce new benefits since company doesnot need to lock them in for all new employees
Cons
Additional admin cost as company has toperiodically update each employees package
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Objective: To meet the diverse needs ofemployees
Advantages:
Encourage responsible usage by employees Reduce wastage of benefits not fully utilized
Employees appreciate perks better because theyare more aware of the dollar value of benefits
Disadvantages: Extra cost
More administrative work as plan may becomplicated
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Flextime
Compressed workweek
Job sharing Teleworking
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A plan whereby employees workdays arebuilt around a core of mid-day hours whenall workers are required to be present.
Workers can arrange their own starting andstopping hours before and after the coreperiod.
Positive effects on employee productivity, jobsatisfaction, satisfaction with work schedule, andemployee absenteeism.
Positive effect on absenteeism was much greaterthan on productivity.
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Non-conventional 5-day, 40-hourworkweek
Example pilots, doctors, nurses etc.
Increase productivity Less disruption from shift changes
Longer time-off-work periods
Reduced absenteeism
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Job sharing Allowing two or more people to share a single
full-time job.
Teleworking Employees work from home using telephones and
the Internet to transmit letters, data, andcompleted work to the home office.
Allows employees to manage work and familyresponsibilities