Strategy for Human Resource Management Lecture 24 HRM 765.

Strategy for Human Resource Management

Lecture 24

HRM 765

Last Lecture• Group Incentives (dependent work)• Individual Incentives (Independent work)• Paying for Performance

– piece-rate plans– Gain-sharing– wage incentive plans– profit sharing– lump sum bonuses

• Deferred bonuses (long term stay)• Stock options • Hiring bonuses (in case of lose)• Perks • Golden parachutes (in case of merger)• International Compensation (base salary, difference in cost of living, assistance

programs)

Fundamentals of Human Resource Management 8e, DeCenzo and Robbins

Topic

Employee Benefits


Learning OutcomesAfter reading this chapter, you will be able to:

• Discuss why employers offer benefits to their employees.• Contrast Social Security, Old Age Benefit, and workers’ compensation benefits.• Identify and describe the major types of health insurance options.• Outline and describe major types of retirement programs organizations offer.• Explain the reason companies offer vacation benefits to their employees.• Describe the purpose of disability insurance programs.• List the various types of flexible benefit option programs.


What to do?

A

• Rs. 50,000

B

• Rs. 45,000

• 30 leaves /Year• Car• Free Medical• Life Insurance


IntroductionEmployee benefits

• Have grown in importance and variety

• Typically membership-based rewards offered to attract and keep employees

• Do not directly affect a worker’s performance, but inadequate benefits lead to employee dissatisfaction.


Benefits


Introduction

Costs of Providing Employee Benefits – Benefit and service offerings add about 40%

to an organization’s payroll cost. – Benefits become the focus of negotiations

with employees when large wage and salary increases are not feasible.


IntroductionContemporary Benefits

Offerings – Benefits today reflect the diversity

of the work force. – Challenge -- designing a benefits

package which is attractive to applicants and current workers, and provides all the legally required benefits.


Legally Required Benefits

Social Security – Financed by equal employee and employer

contributions, based on a percentage of earnings.

– Provides income for retirees, disabled workers and surviving dependents.

– Provides some health insurance coverage through Medicare.



Old Age Benefit

After the retirement a fixed amount of monney to an employee.



Workers’ Compensation – Paid by the organization– Rates based on likelihood of accidents, and

the type of industry. – Benefits pay expenses and/or compensate for

losses resulting from work-related accidents or illness, regardless of fault.



Family and Medical Leave

Vacations

Medical leaves

Paid leaves

Forced leaves


Voluntary BenefitsTraditional health

insurance

• Typically has the fewest coverage limitations for the employee

• Usually the most expensive


Domestic Partner Benefits

Benefits offered to an employee’s living partner. e. g. Wife/Husband


Voluntary Benefits

Preferred Provider Organizations (PPOs)

• Member health care providers agree to provide services at a fixed fee

• Employees are encouraged by lower rates to use member or “preferred” providers.


Voluntary BenefitsHealth insurance continuation

• The Consolidated Omnibus Budget Reconciliation Act (COBRA) – Provides for continuation of benefits for

up to three years after an employee leaves a job.


Voluntary Benefits

The HIPAA Requirement

• The Health Insurance Portability and Accountability Act.– Imposed on employers and health providers

regulations regarding the confidentiality of employee health information.



Summary

• Employee benefits (Other than pay/wages) • Social security• Old Age Benefit• Domestic Partner Benefits• Health Insurance • Preferred Provider Organizations (Fixed Medical Rate)• The Health Insurance Portability and Accountability Act• Benefits Overview Benefits that are common at large communications companies.


Strategy for Human Resource Management Lecture 24 HRM 765.

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