Employee Benefits Chapter 10 PDF

Employee Bene+ts Chapter 10 Learning Objec-ves Key aspects of managing employee benefits and the characteristics of strategic benefits programs that are cost-effective. Employee benefits required by law. Discretionary employee benefits. Recent trends in retirement policies and progr...

Employee Bene+ts Chapter 10 Learning Objec-ves Key aspects of managing employee benefits and the characteristics of strategic benefits programs that are cost-effective. Employee benefits required by law. Discretionary employee benefits. Recent trends in retirement policies and programs, and the major factors involved in managing pension plans. Types of work-life benefits employers may provide. 2  Elements of an E6ec-ve Bene8ts Program Benefits Strategy Communicating Allowing for Employee Benefits Employee Information Involvement Administering Flexible Benefits Benefits for a Diverse Workforce Copyright © 2020 by Nelson Education Ltd. 3  Allowing for Employee Involvement Need should be determined through consultation with employees. How to do it: o Committees o Opinion surveys o Focus groups o Employee participation o Websites Copyright © 2020 by Nelson Education Ltd. 4  Bene8ts for a Diverse Workforce Flexible Benefits Plans (Cafeteria Plans) Benefit plans that enable individual employees to choose the benefits that are best suited to their particular needs A basic or core benefits package of life and health insurance, sick leave, and vacation ensures that employees have a minimum level of coverage. Employees use credits to “buy” whatever other benefits they need. Copyright © 2020 by Nelson Education Ltd. 5 Flexible Bene8ts: Advantages and Disadvantages Copyright © 2020 by Nelson Education Ltd. 6  Communica-ng Employee Bene8ts Informa-on Methods to Communicate Benefits to Employees In-house publications/bulletin boards Group meeting and training classes Online modules (self-service) Blogs/Benefit hotlines Social media Payroll inserts and pay stub messages Specialty brochures hotlines New hire orientations Copyright © 2020 by Nelson Education Ltd. 7 HRIS and Employee Bene8ts Benefits of an HRIS:  Reduced costs  Increased efficiencies  Accuracy Once operational, online systems are easy and inexpensive to adapt to employer and employee demands. Large organizations often outsource benefit administration. Copyright © 2020 by Nelson Education Ltd. 8  Concerns of Management Benefits constitutes 20 to 25% of payroll cost in Canada ( USA 30-35%) Management is concerned with tax consequences of benefits. Conference Board of Canada suggests a list of Cost Containment Strategies – Contribution changes (e.g., increase deductibles) – Dollar limits (e.g., dollar cap on eyeglass) – Coverage changes (e.g., limits on hospital upgrades) – Benefit caps (e.g., on dispensing fees) – Use of preferred providers Copyright © 2020 by Nelson Education Ltd. 9  Employee Bene8ts Required by Law Canada and Quebec Pension Plans (CPP/QPP) Employment Insurance (EI) Workers’ Compensation Insurance Provincial hospital and medical services Copyright © 2020 by Nelson Education Ltd. 10  Employee Bene8ts Required by Law Workers’ Compensation Insurance Insurance provided to workers to defray the loss of income and cost of treatment resulting from work-related injuries or illness Copyright © 2020 by Nelson Education Ltd. 11 Employee Bene8ts Required by Law Copyright © 2020 by Nelson Education Ltd. 12  Discre-onary Major Employee Bene8ts Healthcare Benefits: Medical benefits Dental, optical, and mental health benefits Wellness programs Employee assistance programs (EAP) Copyright © 2020 by Nelson Education Ltd. 13 Discre-onary Major Employee Bene8ts Copyright © 2020 by Nelson Education Ltd. 14  Payment for Time Not Worked Vacations with pay – Eligibility varies by industry, locale, and size of org. – Vacation duration (3,4,5 weeks) depends on work tenure (5, 10, 15 years) Paid holidays (statutory or designated by province) Sick leave (due to illness or injury) Severance pay – A lump-sum payment given to terminated employees by an employer at the time of an employer-initiated termination Copyright © 2020 by Nelson Education Ltd. 15  Re-rement Programs Retirement is an important part of life and requires careful preparations: Retirement Policies Preretirement Programs Pension Plans Copyright © 2020 by Nelson Education Ltd. 16  Types of Pension Plans Defined-benefit plan – benefits are determined by a predefined formula: years of service, average Contributory plan earning… Non-contributory plan Defined-contribution plan – Variety of forms: some involve profit sharing, matching contribution by employers, employers sponsored RRSP Copyright © 2020 by Nelson Education Ltd. 17  Pension Plans Federal regulation of pension plans  Registered pension plans (RPPs) are subject to federal and provincial regulations Pension portability  For a long time most pension plans lacked portability  Employees who leave the org. can leave their locked-in funds in their current pension plan or transfer into locked-in RRSP or transfer into new employer’s pension plan. Pension funds  Pension funds can be as trusted plan (administered by trustees) or insured (by buying purchasing insurance annuities) Copyright © 2020 by Nelson Education Ltd. 18  Employee Services: Crea-ng a Work–Life SePng Employee assistance programs (EAPs) Counselling services Childcare and eldercare Other services (work-life balance) Copyright © 2020 by Nelson Education Ltd. 19  Employee Services: Crea-ng a Work–Life SePng Employee assistance programs (EAPs) – Services provided by employers to help workers cope with a wide variety of problems that interfere with the way they perform their jobs Copyright © 2020 by Nelson Education Ltd. 20  Employee Services: Crea-ng a Work–Life SePng Eldercare – Care provided to an elderly relative by an employee who remains actively at work – About 32 percent of Canadians have eldercare responsibilities. – Employees spend an average of 23 hours each month on eldercare Copyright © 2020 by Nelson Education Ltd. 21  Employee Services: Crea-ng a Work–Life SePng Copyright © 2020 by Nelson Education Ltd. 22