PowerPoint Presentation by Charlie CookPowerPoint Presentation by Charlie CookThe University of West AlabamaThe University of West Alabama

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Human Resource Human Resource ManagementManagement

ELEVENTH EDITIONELEVENTH EDITION

G A R Y D E S S L E RG A R Y D E S S L E R

© 2008 Prentice Hall, Inc. © 2008 Prentice Hall, Inc. All rights reserved.All rights reserved.

Benefits and ServicesBenefits and Services

Chapter Chapter 1313

Part 4 | CompensationPart 4 | Compensation

© 2008 Prentice Hall, Inc. All rights reserved. 13–2

After studying this chapter, you should be able to:After studying this chapter, you should be able to:

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

2.2. Describe each of the main insurance benefits.Describe each of the main insurance benefits.

3.3. Discuss the main retirement benefits.Discuss the main retirement benefits.

4.4. Outline the main employees’ services benefits.Outline the main employees’ services benefits.

5.5. Explain the main flexible benefit programs.Explain the main flexible benefit programs.

© 2008 Prentice Hall, Inc. All rights reserved. 13–3

BenefitsBenefits

Supplemental Pay

Employee Services

Insurance Benefits

Retirement Benefits

Types of Employee Benefits

© 2008 Prentice Hall, Inc. All rights reserved. 13–4

Policy Issues in Designing Benefit PackagesPolicy Issues in Designing Benefit Packages

Policy Issues

Who will be covered

Coverage during probation

Degree of employee choice

Which benefits to offer

Whether to include retirees

How to finance benefits

Cost containment procedures

Communicating benefits options

© 2008 Prentice Hall, Inc. All rights reserved. 13–5

Pay For Time Not WorkedPay For Time Not Worked

Vacations and Holidays

Parental Leave

Supplemental Unemployment

Benefits

Supplemental Pay

Benefits

Unemployment Insurance

Sick Leave

Severance Pay

© 2008 Prentice Hall, Inc. All rights reserved. 13–6

Insurance BenefitsInsurance Benefits

• Workers’ CompensationWorkers’ Compensation Provides income and medical benefits to work-Provides income and medical benefits to work-

related accident victims or their dependents, related accident victims or their dependents, regardless of fault.regardless of fault. Death or disability: a cash benefit based on earnings per Death or disability: a cash benefit based on earnings per

week of employment.week of employment. Specific loss injuries: statutory list of lossesSpecific loss injuries: statutory list of losses

Controlling workers’ compensation costsControlling workers’ compensation costs Screen out accident-prone workers.Screen out accident-prone workers. Make the workplace safer.Make the workplace safer. Thoroughly investigate accident claims.Thoroughly investigate accident claims. Use case management to return injured employees to work Use case management to return injured employees to work

as soon as possible.as soon as possible.

© 2008 Prentice Hall, Inc. All rights reserved. 13–7

Trends in Health Care Cost ControlsTrends in Health Care Cost Controls

Communication, Involvement, and

Empowerment

Health Savings Accounts

Premiums and Co-Pays

Cost-Control Trends

Prevention Programs

Claim Audits

© 2008 Prentice Hall, Inc. All rights reserved. 13–8

Other Cost-Control OptionsOther Cost-Control Options

Automating health care plan administration

Defined contribution health care plans

Eliminating retiree health care coverage

Benefits purchasing alliances

Controlling Health Care Costs

Outsourcing health care plan administration

© 2008 Prentice Hall, Inc. All rights reserved. 13–9

Retirement Benefits (cont’d)Retirement Benefits (cont’d)

Membership Requirements

VestingBenefit

FormulaPlan

Funding

Policy Issues In Pension Planning

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Retirement Benefits (cont’d)Retirement Benefits (cont’d)

Defined Benefits Plans

Defined Contribution Plans

Qualified Plans

Nonqualified Plans

Types of Pension Plans

© 2008 Prentice Hall, Inc. All rights reserved. 13–11

Retirement Benefits (cont’d)Retirement Benefits (cont’d)

401(k)Plans

Employee Stock

Ownership Plans

(ESOPs)

Savings and Thrift Plans

Types of Defined Contribution

Plans

Deferred Profit-Sharing

Plans

Cash Balance Pension Plans

© 2008 Prentice Hall, Inc. All rights reserved. 13–12

Personal Services (cont’d)Personal Services (cont’d)

1

Be aware of legal issues.

Ensure professional staffing.

Steps for Launching an EAP Program

Develop a policy statement.

Maintain confidential record-keeping systems.

2

3

4

© 2008 Prentice Hall, Inc. All rights reserved. 13–13

Flexible Benefits ProgramsFlexible Benefits Programs

• Cafeteria (Flexible Benefits) ApproachCafeteria (Flexible Benefits) Approach Each employee is given a limited benefits fund Each employee is given a limited benefits fund

budget to spend on preferred benefits.budget to spend on preferred benefits. Types of plansTypes of plans

Flexible spending accountsFlexible spending accounts Core plus option plansCore plus option plans

• Flexible Work ArrangementsFlexible Work Arrangements Flextime schedulesFlextime schedules Compressed workweek schedulesCompressed workweek schedules Job sharingJob sharing Work sharingWork sharing TelecommutingTelecommuting

© 2008 Prentice Hall, Inc. All rights reserved. 13–14

K E Y T E R M SK E Y T E R M S

benefitsbenefits

supplemental pay benefitssupplemental pay benefits

unemployment insuranceunemployment insurance

sick leavesick leave

severance payseverance pay

supplemental unemployment benefitssupplemental unemployment benefits

workers’ compensationworkers’ compensation

case managementcase management

health maintenance organization (HMO)health maintenance organization (HMO)

preferred provider organizations (PPOs)preferred provider organizations (PPOs)

group life insurancegroup life insurance

Social SecuritySocial Security

pension planspension plans

defined benefit pension plandefined benefit pension plan

defined contribution pension plandefined contribution pension plan

portabilityportability

401(k) plan401(k) plan

savings and thrift plansavings and thrift plan

deferred profit-sharing plandeferred profit-sharing plan

employee stock ownership plan (ESOP) employee stock ownership plan (ESOP)

cash balance planscash balance plans

Employee Retirement Income Security Act Employee Retirement Income Security Act (ERISA) (ERISA)

Pension Benefits Guarantee Corporation Pension Benefits Guarantee Corporation (PBGC)(PBGC)

vested fundsvested funds

early retirement windowearly retirement window

employee assistance programemployee assistance program

family-friendly benefitsfamily-friendly benefits

flexible benefits plan/cafeteria benefits planflexible benefits plan/cafeteria benefits plan

flextimeflextime

compressed work weekcompressed work week

job sharingjob sharing

work sharingwork sharing

telecommutingtelecommuting