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15

  1. 1. 1. Benefits: Something that promotes or enhances well-being or a payment made or an entitlement available in accordance with a wage agreement, an insurance policy, or a public assistance program 2. Services: It matches an improvement (gain) in performance with a distribution (sharing) of the benefit with the employee 3. Direct Compensation: a. These are a type of compensation paid to employees from employers b. This is pay an employee receives for helping the company in the revenue generating cycle c. These forms of compensation reward an employee for the quantity of service or quality of service provided to the firm d. Examples are i. Base salary ii. Bonus pay iii. Overtime wages 4. Indirect Compensation: a. These are the second form of compensation from an employer to an employee b. The benefits and services some times called as indirect compensation c. The company is not physically paying the employee in money & They do not directly benefit the firm d. These forms of compensation are non monetary e. Examples are i. Time off ii. Training iii. Health insurance iv. Retirement contributions. 5. Elements of Compensation: a. Direct Compensations: i. Compensation Management ii. Incentives & Gain sharing b. Indirect Compensation: i. Security , Safety & Health ii. Benefits & Services - Base Pay & salaries Pay for performance - Legally mandated benefits Fringe benefits 6. Role of Indirect Compensation: a. Societal Objectives: These objectives address the social needs (health care, disability or retirement benefits) of the employee. The Govt helps the employers by tax treatment (tax free) programs to offer maximum benefits to the employees b. Organizational Objectives: These objectives stick the employee to stay on with an organization because of the offered fringe benefits. The time off benefits reduces the fatigues & enhances the productivity during the hours of work c. Employee Objectives: 7. Insurance Benefits: a. Health Related Insurance i. Medical Insurance: It pays for the sickness, accident & hospitalization expenses accommodation ii. Managed Care: It is a health care maintenance coverage related to health problems offered by the employer. iii. Vision Insurance: It includes eyes examination & eyeglasses for the vision care
  2. 2. iv. Dental Insurance: It includes dental examination & care v. Mental Health Insurance. It is psychiatric care & counseling b. Life Insurance: c. Disability Insurance: d. Other Insurance Benefits: i. Legal Insurance ii. Group Home Owner Insurance iii. Group Automobile Insurance 8. Employees Security Benefits: a. Employment Income Security: i. Severance Pay (for the below executive employees) ii. Golden Parachutes (mostly for the executive employees) iii. Layoff (despite layoff some firms provide income to employees who are available on recalled) b. Retirement Security: i. Developing a retirement plan ii. Employee Retirement Income Security Act (ERISA) iii. Early Retirement iv. Retirement Counseling 9. Time off Benefits: a. On the Job Breaks: i. Rest ii. Meal or Tea iii. Prayer b. Sick Days: c. Well Pay: Payment for unused sick leave is sometimes called well pay, which may serve an incentive for the attendance d. Holiday & Vacations: e. Leave of Absence: i. Illness ii. Pregnancy iii. Accident f. Family & Medical Leave Act of 1993: The 12 weeks of unpaid leave during any 12 months, under certain circumstances such as care of baby or care for serious health conditions of spouse, parents or child 10. Work Schedule Benefits: a. Shorter Work Times b. Flextime c. Job Sharing 11. Employees Services: a. Educational Assistance b. Financial Services c. Social Service i. Child Care ii. Elder Care iii. Relocation Programs iv. Social Services Programs
  3. 3. 12. Administration of Benefits & Services: a. Problems in Administration b. Traditional Remedies c. Cafeteria Benefits

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