• Get familiar with 9 Learning Outcomes(LOs) LO• The role of employee benefits(Leary)• Benefits required by law(Journey)• Legal requirements for employee benefits(Hansey)• Optional benefits programs(ChaoQian)• Selecting employee benefits(Sugar)• Communicating benefits to employees(Justin)• Have some fun(Aziz!!!)
n.1. Something that promotes or enhances well-being; anadvantage.2. A payment made or an entitlement available inaccordance with a wage agreement, an insurancepolicy, or a public assistance program.3. A public entertainment, performance, or social eventheld to raise funds for a person or cause.4. Archaic A kindly deed.
For the company :• Attracting potential candidates• Motivating employees• Retaining those who may want to leave
For the employee:• Maintain economic security• Pensions→retirement• Insurance→unexpected costs
• Law requirements• Tax law tricks• Better deal with groups
To teach employees:• How to use them?• Why are they valuable? Communicating Benefit LO1! The importance of benefits
• Tax treatment of benefits• Antidiscrimination Laws• Accounting Requirement LO8! Regulations affecting design of benefit
Advantage True Falsethere are no limits or restrictions on the amount of capital or theoperating losses that a corporation may carry back or forward.no immediate tax on employees for the amount the employercontributesthe ability for employees to immediately take a tax deduction forthe funds they contribute to the plansFor the those in the middle class and lower classes, an earnings taxmay be a financial hardship, regardless of the amount.tax-free earnings on the money in the retirement fund
USA case:• During an interview it is illegal to ask only women if they have child-care needs.• Hiring only men to model male underwear is legal .• If a company unintentionally hires a disproportionate number of non-minorities, they can be held liable for discrimination.• Organizations can screen candidates using a test that reliably predicts on-the-job performance
• China Casea. It is illegal to ask only women to have a sexually transmitted _____disease examination or write about their menstruation whenrecruiting public officialsb.It is illegalto ask applicants to have a hepatitis B check.c.It is illegal to ask the applicants to have a postgraduate degreewhen recruiting a security.
• The condition not related to the jobs is illegal.
• Group6 company has determined that they will have to reduce their benefits costs to stay competitive. Which of the following solutions is not a choice for Group6 ? a) A) Eliminate health coverage b) B) Reduce the percentage of employees’ Social Security insurance they pay. c) C) Reduce their unemployment insurance costs by managing their workforce to avoid layoffs. d) D) Institute a safety program to minimize worker’s compensation costs.
• Accounting requirement in USA• -FASB -Why? -How?• Accounting requirement in China ↓
• The subsidies and non-monetary benefits for the employees health care and life• The cost of depreciation, maintenance and labor occurring in the inner collective benefit department• The hardship subsidies for employees or the fund set and managed by company for assisting the employees in difficulty• The additional cost for retired personnel• Other employees benefit according the requirement, for example, the funeral subsidies
U.S.A1. Social Security (To provide support for retired workers)• Old Age Insurance• Survivor Insurance• Disability Insurance• Health Insurance
• 1. Can I select to begin receiving the retirement benefits before I reach the full retirement age?• 2.What is exempt amount?• 3.How the cost of Social Security is shared between employers and employees?
2.Unemployment Insurance(To minimize the hardship of unemployment)• Payments to unemployed workers• Help in finding new jobs• Give incentives to stabilize employment• Make workers can afford to wait to return to their employer.
For company:• The size of the unemployment tax imposed on each employer depends on the employer’s experience rating. Careful human resource planning can minimize layoffs and keep their experience rating favorable
Who can receive it?• A is actively seeking work, but has no working experiences before.• B is not available for work because of his health condition.• C is out of job now because he was discharged for cause
“State programs that provide benefits to workers who suffer work-related injuries or illnesses, or to their survivors.”
3.Workers Compensation(To provide benefits and services to workers injured on job)• Disability income• Medical care• Death benefits• Rehabilitative services
4.Unpaid Family and Medical Leave• FMLA5.Health Care Benefits• PACA
U.S.A ChinaSocial Security Old Age Insurance Social Security Pension Insurance Survivor Insurance Basic Medical Insurance Disability Insurance Unemployment Insurance Health Insurance Maternity Insurance On-Job Injury InsuranceUnemployment Insurance Group InsuranceWorkers Compensation Disability income Housing Funds Medical care Death benefits Rehabilitative serviceUnpaid Family and Medical LeaveHealth Care Benefits LO2! Summarize the types of employee benefits required y law
Paid Leave Group InsuranceRetirement Plans “Family-Friendly” Benefits Other Quality of Work-Life Benefits
Percentage of Full-Time Workers with Access to Selected Benefit Programs
Paid Leave• Vacation - typically two weeks or less a year• Holidays - about 10 paid holidays each year• Sick Leave - based on length of service• Personal Days• Floating Holidays• Jury Duty• Funerals• Military Duty• Time Off to Vote
Most flexible approachEmployer pools personal days, sick days, andvacation days for employees to use as the need arises LO3! Describe the most common forms of paid leave
Group Insurance• Medical Insurance• Life Insurance• Disability Insurance• Long-term care Insurance
• 70% of all full-time employees in the U.S. receive medical benefits, which cover: – Hospital expenses – Surgical expenses – Visits to physicians
If the employee dies during the term of thepolicy, the employee’s beneficiaries receive adeath benefit payment. LO4! Identify the kinds of insurance benefits offered by employers
Retirement PlansAbout half of employees working in theprivate business sector have employer- sponsored retirement plans.
• Contributory Plan A• Noncontributory Plan BA. retirement plan funded by contributions fromthe employer and employee.B. retirement plan funded entirely bycontributions from the employer. LO5! Define the types of retirement plans offered by employers
• Defined benefit plan – pension plan that guarantees a specified level of retirement income.• Defined contribution plan – retirement plan in which the employer sets up an individual account for each employee and specifies the size of the investment into that account.
• Mrs. Fu does not know a lot about investing and wants to ensure she has some retirement income when she is old enough to retire. Aziz plans on changing his job every few years and is interested in investing his own money. Which plan would be best for Mrs. Fu and Aziz, respectively? a) A) Defined contribution; defined benefit b) B) Contributory; defined benefit a) c) C) Defined benefit; defined contribution d) D) Defined contribution; non-contributory
“Family-Friendly” Benefits Why: employees’ need to manage conflicts between their work and family roles• Family Leave• Child Care Benefits• College Savings Plans• Elder Care
Other Quality of Work-Life Benefits Name one possible employee benefit.• Subsidized cafeterias • Tuition• On-site health care reimbursement services • On-site fitness center• Moving and relocation • Off-site company expenses recreation area• Employee discounts on products • Pet services LO6!Describe how organizations use other benefits to match employees’ wants and needs
Not every recognition program needs to cost the companymoney. Honour Wall Certificates that is hand-signed by the executive A special surprise visit from (the owner) Recognition Outing - Give the employees a half day off and take them to an early Dinner/Lunch One day paid holiday level 3 level 2 Level1
Reflect upon the Brand Image Lunch for early shifters Dinner for late shifters
• Level 3:public holidays(around 29 days)• Level 2: public holidays plus a week• Level 1:public holidays plus three weeks
Sales：• 0.5% bonus for one productEvaluation from customers：• 2% for excellent• 1% for good• no bonus for plain or bad
• What’s the benefit of Shenzhen Hukou?1.Higher pay of insurance2.Fulfillment of job seeking3.Education of children4.Family members can get the residence withyou after 2 years.5.Free technical training
• There is a company which is planning to provide some benefits for its employees• What is its aim or start point？• Of course it is the company’s goals. If a company want to get a competitive advantage by retaining good employees, it must select and monitor its benefits effectively.
• What can the employees of the company get?• Objective parts: The types and quality of the benefits package.• Subjective parts: The value and expectations of the employees. (It is the criteria for the objective levels of benefits.)
Who should pay for the benefits?• 1. Companies’ goal: Keeping balance of the cost and attractiveness of its benefits.• 2.Employees’ economic position must be considered.
• If a company decides to start a certain benefit, how the company can ensure it can come into effect?
• For all effective benefits, there are three common standards to identify it.• Legal requirement• Availability• Demographic
• One important method to achieve the standards is to establish Cafeteria-style plans.
• The plans will lead to higher administrative costs, how to avoid it?• The answer is to use software packages and standardized plans.
• The analysis for Sunnia’s benefit project 1.Goal：Sunnia’s MVV 2.Expectation: Young female employees’ three needs: Survival, Development, Future Family 3.Budget So we want to design a more flexible arrangement for benefits. LO7! Explain how to choose the content of benefit package
• Using multiple channels• Be Congruent• Take responsibility• Establish mutual trust
• New employees – Offer introduction session• Present employee – Offer seasonal consultation• Distribute staff handbook• Encourage employees to ‘Enjoy’ the benefits
• Suggestion? LO8! Discuss the importance of communicating the benefits
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