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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 Discuss benefits provided by companies in Asia

2. 3. 4. 5. 6.

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Four main types of plans:

1.Supplemental pay benefits 2.Insurance benefits 3.Employee services 4.Retirement benefits

Benefits
Indirect financial and non-financial payments employees receive for continuing their employment with the company.
Pay for time not worked Insurance benefits Retirement benefits Services and family-friendly benefits

Types of employee benefit plans

Also known as supplemental pay benefits Examples include:

Holidays Sick leave Parental leave

Proper leave records should be kept by employers

Unemployment Insurance : Vacation and holiday Sick leave

Provides benefits if a person is unable to work through some fault other than his or her own.

Number of paid vacation days varies by country. Provides pay to an employee when he or she is out of work because of illness. Important benefit especially where many workers are females with children

Parental leave

Severance pay
A one-time payment when terminating an employee. 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.

Workers compensation (monetary or medical)

Provides income and medical benefits to workrelated accident victims or their dependents, regardless of fault.
Death or disability: a cash benefit based on prior earnings.

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.

Hospitalization, health, and disability insurance

Protects employees against hospitalization costs and loss of income arising from off-the-job accidents or illness.
Accidental death . Disability insurance Insurance for health-related expenses

Health maintenance organization (HMO)

A medical organization consisting of specialists operating out of a community-based health care center.
Provides routine medical services to employees who pay a nominal fee. Receives a fixed annual contract fee per employee from the employer (or employer and employee), regardless of whether it provides that person with service.

Life insurance
Most employers provide group life insurance plans. Employees can obtain lower rates in a group plan. Employer usually pays 100 percent of the base premium; the employee pays for any additional coverage.

Pension plans
Financial programs that provide a fixed amount when employees reach a predetermined retirement age or when they can no longer work due to disability. Defined Benefit pension plan: A plan that contains a formula for determining retirement benefits Defined Contribution Plans: A plan in which the employers contribution to employees retirement savings funds is specified. Portability: Instituting policies that enable employees to easily take their accumulates pension funds when they leave employer.

Social security plans

Vary from country to country Broadly 3 types of benefits Retirement income Survivors or death benefits payable to the employees dependents regardless of age at the time of death Disability benefits payable to disabled employees and their dependants. Only if insured under Social security Act.

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, flexible work schedules

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 benefits package.
Core plus option plans establish a core set of benefits which are mandatory for all employees.

The cafeteria (flexible benefits) approach (contd)

Pros
Employees can choose the package that suits them best Easier to introduce new benefits since company does not need to lock them in for all new employees

Cons
Additional admin cost as company has to periodically update each employees package

Objective: To meet the diverse needs of employees Advantages:

Encourage responsible usage by employees Reduce wastage of benefits not fully utilized Employees appreciate perks better because they are more aware of the dollar value of benefits

Disadvantages:
Extra cost More administrative work as plan may be complicated

Flextime

Compressed workweek
Job sharing Teleworking

A plan whereby employees workdays are built around a core of mid-day hours when all workers are required to be present. Workers can arrange their own starting and stopping hours before and after the core period.
Positive effects on employee productivity, job satisfaction, satisfaction with work schedule, and employee absenteeism. Positive effect on absenteeism was much greater than on productivity.

Non-conventional 5-day, 40-hour workweek

Example pilots, doctors, nurses etc.

Increase productivity
Less disruption from shift changes
Longer time-off-work periods Reduced absenteeism

Job sharing Teleworking

Allowing two or more people to share a single full-time job. Employees work from home using telephones and the Internet to transmit letters, data, and completed work to the home office. Allows employees to manage work and family responsibilities