HRM500 Week 8 Scenario Script: Providing Employee Benefits Slide # Scene/Interaction Narration HRM500 Week 8 Scenario Script - Part 1: Providing Employee Benefits Slide 1 Scene 1 Angela’s Office HRM500_8_1_Angela-1: Welcome back, team! Today we need to take a look at employee benefits such as insurance, retirement, and paid time off. Benefits are part of the total compensation package paid to employees. Benefits serve a function similar to pay. Benefits help to attract, retain and motivate employees. Employees look for different types of benefits, and should examine their benefits regularly. Benefits can also be complex and expensive. If we spend a lot on benefits but employees do not understand their value or how to use them, the company will waste money. At today’s meeting, we will examine benefits required by law, optional benefit programs, selecting employee benefits, legal requirements for employee benefits and communicating benefits to employees. Slide 2 Scene 2 – Angela’s office HRM500_8_2_Angela-1: Ashley and Michael, we need to look at creating a benefits package for the upcoming year for the organization. Employees have come to expect that benefits will help them maintain economic security. Even though many kinds of benefits are not required by law, they have become so common that today’s employees expect them. Where do you think we should start? HRM500_8_2_Ashley-1: We should first look at benefits required by law. The federal and state governments require various forms of social insurance to protect workers from the financial hardships of being out of work. Social Security provides support for retired workers; unemployment insurance assists laid-off workers; and workers’ compensation provides benefits and services to workers injured on the job. HRM500_8_2_Michael-1: Employers must also provide unpaid leave for certain family and medical needs. Because these needs are required by law, employers cannot gain an advantage in the labor market by offering them, nor can they design these benefits. The emphasis for these benefits must be adhering to the law. Slide 3 Scene 3 - Angela’s office 2 person, 3 part interaction will be used for the 3 most common types of health care plans HRM500_8_3_Angela-1: Good observations on required benefits, team! Now let’s take a look at optional benefit programs. These include various kinds of insurance, retirement plans and paid leave. HRM500_8_3_Ashley-1: The main areas of paid leave are vacations, holidays, and sick leave. We should also establish policies for other situations that require time off. Organizations often provide paid leave for jury duty, funerals of family members, and military duty. HRM500_8_3_Michael-1: Some organizations even offer paid time off to vote and donate blood! Establishing policies communicates the organization’s values, clarifies what employees can expect, and prevents situations in which unequal treatment leads to claims of unfairness. HRM500_8_3_A ...

1. HRM500 Week 8 Scenario Script: Providing Employee Benefits
Slide #
Scene/Interaction
Narration
HRM500 Week 8 Scenario Script - Part 1: Providing Employee
Benefits
Slide 1
Scene 1
Angela’s Office
HRM500_8_1_Angela-1: Welcome back, team! Today we need
to take a look at employee benefits such as insurance,
retirement, and paid time off.
Benefits are part of the total compensation package paid to
employees. Benefits serve a function similar to pay. Benefits
help to attract, retain and motivate employees.
Employees look for different types of benefits, and should
examine their benefits regularly. Benefits can also be complex
and expensive. If we spend a lot on benefits but employees do
not understand their value or how to use them, the company will
waste money.
At today’s meeting, we will examine benefits required by law,
optional benefit programs, selecting employee benefits, legal
requirements for employee benefits and communicating benefits
to employees.
Slide 2
Scene 2 – Angela’s office
HRM500_8_2_Angela-1: Ashley and Michael, we need to look
at creating a benefits package for the upcoming year for the
organization.

2. Employees have come to expect that benefits will help them
maintain economic security. Even though many kinds of
benefits are not required by law, they have become so common
that today’s employees expect them. Where do you think we
should start?
HRM500_8_2_Ashley-1: We should first look at benefits
required by law. The federal and state governments require
various forms of social insurance to protect workers from the
financial hardships of being out of work.
Social Security provides support for retired workers;
unemployment insurance assists laid-off workers; and workers’
compensation provides benefits and services to workers injured
on the job.
HRM500_8_2_Michael-1: Employers must also provide unpaid
leave for certain family and medical needs. Because these needs
are required by law, employers cannot gain an advantage in the
labor market by offering them, nor can they design these
benefits. The emphasis for these benefits must be adhering to
the law.
Slide 3
Scene 3 - Angela’s office
2 person, 3 part interaction will be used for the 3 most common
types of health care plans
HRM500_8_3_Angela-1: Good observations on required
benefits, team! Now let’s take a look at optional benefit
programs. These include various kinds of insurance, retirement
plans and paid leave.
HRM500_8_3_Ashley-1: The main areas of paid leave are
vacations, holidays, and sick leave. We should also establish

3. policies for other situations that require time off. Organizations
often provide paid leave for jury duty, funerals of family
members, and military duty.
HRM500_8_3_Michael-1: Some organizations even offer paid
time off to vote and donate blood! Establishing policies
communicates the organization’s values, clarifies what
employees can expect, and prevents situations in which unequal
treatment leads to claims of unfairness.
HRM500_8_3_Ashley-2: Group insurance is typically offered at
a lower cost than individual policies. When employees receive
insurance as a benefit instead of higher pay so they can buy
their own insurance, employees can get more for their money.
HRM500_8_3_Michael-2: The most important benefit is
medical insurance. According to the Fundamentals of Human
Resource Management textbook, almost seventy-five percent of
U.S. employees receive medical benefits. Health insurance
covers hospital expenses, surgical expenses and visits to
physicians. Many organizations offer dental care, vision care,
birthing centers and prescription drug programs as well.
HRM500_8_3_Angela-2: (interaction, home screen): Can you
give me a quick rundown of typical health care plans we can
choose from here at Montrose?
HRM500_8_3_Ashley-3: (interaction, home screen): Sure,
Angela! There are three common types of health care plans
organizations tend to use.
HRM500_8_3_Ashley-3a: (interaction, tab A): One widely used
option for health care is the health maintenance organization, or
HMO. This plan requires patients to receive their medical care
from the HMO’s health care professional, instead of being able
to choose their own provider.

4. HRM500_8_3_Ashley-3b:(interaction, tab B): A preferred
provider organization, or PPO, is another option. This type of
health care plan contracts with health care professionals to
provide services at a reduced fee. Often the PPO does not
require employees to use providers in the network, but it pays a
larger share of the cost of services from PPO providers.
HRM500_8_3_Ashley-3c: (interaction, tab C): A final option is
a flexible spending account controlled by employees. In this
type of plan, pretax earnings are set aside to pay for certain
eligible expenses, such as health care expenses.
HRM500_8_3_Angela-3: Thanks so much, Ashley! Based on the
information you have given me, I’m thinking that the PPO is our
most solid option for Montrose’s employee healthcare needs.
Michael, can you tell me about any supplemental programs we
can also implement to let our employees know we care about
them and their health?
HRM500_8_3_Michael-3: Absolutely! An employee wellness
program, or EWP, is a set of communications, activities and
facilities designed to change health-related behaviors in ways
that reduce health risks. EWPs aim at specific health risks such
as high blood pressure, high cholesterol levels, smoking, and
obesity by encouraging preventive measures such as exercise
and good nutrition.
Companies may also choose to provide life insurance, disability
insurance and long term care insurance.
HRM500_8_3_Angela-4: OK, team, we have now covered the
various types of insurance and paid leave available to
employees. The next topics we need to discuss are also optional
benefits - retirement plans and family-friendly benefits. Can

5. you start us off, Michael?
Slide 4
Scene 4
HRM500_8_4_Michael-1: Well, Angela, while retirement plans
are not required by organizations among persons over sixty-five
years of age, pensions provided a significant share of income in
2006. About fifty percent of people working for private
businesses have employer-sponsored retirement plans.
HRM500_8_4_Ashley-1: A contributory plan is funded by
contributions from the employer and the employee.
Noncontributory plans are funded entirely by the employer.
HRM500_8_4_Michael-2: The Employee Retirement Income
Security Act, or ERISA, is a federal law that increased the
responsibility of pension plan trustees to protect retirees;
established certain rights related to vesting and portability; and
created the Pension Benefit Corporation. This is the federal
agency that insures retirement benefits and guarantees retirees a
basic benefit if the employer experiences financial difficulties.
HRM500_8_4_Ashley-2: A defined contribution plan is a
retirement plan in which the employer sets up an individual
account for each employee and specifies the size of the
investment into that account. A defined benefit plan guarantees
a certain level of retirement income.
HRM500_8_4_Michael-3: In a cash plan, the employer sets up
an individual account for each employee and contributes a
percentage of the employee’s salary. The account earns interest
at a predefined rate.
HRM500_8_4_Angela-1: This is great, team! It seems we will
have a wealth of options to choose from when selecting
retirement plans for our employees. Next we need to look at
family-friendly benefits.
Slide 5

6. Scene 5
HRM500_8_5_Ashley-1: Sure, Angela. These types of benefits
include family leave policies and child care. Normally, these
benefits support employees with family responsibilities.
Family or parental leave grants employees time off to care for
children and other dependents. Additionally, child care benefits
may take several forms, requiring different levels of
organizational involvement. The lowest level is helping
employees collect information about the cost and quality of
available child care. At the highest level of involvement, the
employer actually provides child care at or near the work site.
HRM500_8_5_Michael-1: Other support comes in the form of
college savings for employees’ children as they grow up. Elder
care benefits provide information and support rather than direct
financial assistance. Organizations may provide access to
counseling, flexible schedules and printed resources.
HRM500_8_5_Angela-1: This information is very helpful. We
want Montrose to be known as a family-friendly company,
that’s for sure! Let’s move on now to selecting an employee
benefits package, legal requirements for employee benefits, and
communicating benefits to employees.
Slide 6
Scene 6
*Add URL’s or screenshots for the resources listed
HRM500_8_6_Ashley-1: We must select an employee benefit
package based on our employees’ needs for leisure time and
protection against old age, loss of health and loss of life.
HRM500_8_6_Michael-1: The benefit plan must complement
the efforts of employees on their own behalf. The benefits
should be evaluated annually.

7. HRM500_8_6_Ashley-2: Employees expect to receive benefits
that are legally required, widely available and ones they value.
By offering a cafeteria plan, employees can choose from a set of
alternatives that allow them to select the types and benefits they
want.
HRM500_8_6_Michael-2: Employers should look at costs of the
benefits being offered. The benefits should also be coordinated
with social insurance programs to which the company makes
payments.
Resources to research the costs include the Bureau of Labor
Statistics (BLS), the Employee Benefit Institute and the U.S.
Chamber of Commerce.
Slide 7
Scene 7 – Angela’s office
HRM500_8_7_Angela-1: What are some of the legal
requirements and issues we need to look at when determining
employee benefits?
HRM500_8_7_Ashley-1: Some companies may offer overtime
rather than adding new employees, and they may hire part time
employees instead of full time employees. The IRS strictly
limits the definition of “independent contractors” so that
employers cannot avoid legal obligations for classifying
employees as self-employed when the organization receives the
benefits of a permanent employee. The IRS provides a more
favorable tax treatment of benefits classified as qualified plan.
A number of laws are intended to provide equal employment
opportunities without regard to race, sex, age, disability and
several other protected categories. Equal employment

8. opportunities are intended to cover access to employment
benefits as well as many other job-related issues.
HRM500_8_7_Michael-1: Our company’s financial statements
must meet the many requirements of the Financial Accounting
Standards Board, or FASB. These accounting requirements are
intended to ensure that financial statements are a true picture of
the company’s financial status, and that outsiders, including
potential leaders and investors, can understand and compare
financial statements.
HRM500_8_7_Angela-2: These are important legal
considerations to be aware of! Our final topic for today’s
meeting will be the communication process regarding benefits.
Slide 8
Scene 8
HRM500_8_8_Michael-1: We must communicate benefits
information to employees so they will appreciate the value of
their benefits. This is essential so that benefits can achieve their
objective of attracting, motivating and retaining employees.
HRM500_8_8_Ashley-1: Our employees are interested in their
benefits, and they need a great deal of detailed information to
take advantage of benefits such as health insurance and four –
oh – one - k plans. Electronic technology such as the internet
and supporting databases can play a significant role in modern
benefit systems. Many companies are putting benefit
information on their intranets.
HRM500_8_8_Michael-2: Here at Montrose, we have many
ways of communicating benefits, which include brochures,
question and answer sessions, intranet pages, memos and email.
Some other communication vehicles include paycheck inserts,
retirement and health coaching,training programs and benefit
fairs.

9. HRM500_8_8_Angela-2: Our investment of creativity in
communications to employees can reap great returns in the form
of committed, satisfied employees. Great job team! Let’s
complete a brief activity to test your knowledge on employee
benefit packages before wrapping up today’s meeting.
Slide 9
Interaction – Matching Dropdown on the different types of
benefits available to employees and an example of each:
Benefits Required by Law – Social Security
Optional Benefits – Paid Leave
Health Insurance – Health Maintenance Organization (HMO)
Retirement Plans – Defined Contribution Plan
Family-Friendly Benefits – onsite childcare
Slide 10
Scene 9 – Summary – Angela’s office
HRM500_8_9_Angela-1: Great job matching the types of
benefits we have discussed with the examples of each.
Just to recap, our meeting today was designed to cover the
different types of employee benefits companies can offer in
order to revamp our own employee benefit package here at
Montrose.We covered benefits required by law, optional benefit
programs, selecting employee benefits, legal requirements for
employee benefits, and communicating benefits to employees.
You both have done a very thorough job. I think we have

10. enough information now to draft our proposal for the new
benefit package and present it Montrose’s Board of Directors.
Let’s plan to meet next week in the conference room to discuss
issues surrounding globalization and human resource
management.
Please set aside time this week to complete your discussions on
Benefitsand Collective Bargaining and High Involvement
Organizations and Benefits. Also, don’t forget that your
assignment on Performance Management is due. As usual, have
a wonderful week, team!