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MGT-484 chapters 9-11
Terms in this set (39)
What are the 3 broad categories of discretionary benefits?
paid time off
Provide family benefits, promote health, and guard against income loss caused by such catastrophic factors as unemployment, disability, or serious illnesses
Provides employees time off with pay for such events as vacation
Provide enhancements such as tuition reimbursement and day care assistance to employees and their families
Less than 6 months duration, unable to perform, benefit amount 50% to 100% of pretax income
- Recover from injuries, surgery, treatment of an illness requiring any hospitalization, pregnancy
6 months to life, unable to perform any job qualified for, benefit amount 50% to 70% of pretax pay, 6 to 12 month waiting period, other benefits used first
Term Life Insurance
Provides protection to employees' beneficiaries only during a limited period based on a specified number of years
Whole Life Insurance:
Does not terminate until payment is made to beneficiaries
1. What are some of the paid time off categories we discussed in class?
Holidays, vacation, sick leave, personal leave, jury duty, funeral leave, military leave
What is a Paid Time Off bank approach to managing paid time off?
-Combine holiday , vacation, sick leave, and personal leave policies into a single paid time-off policy
-The idea is to provide individuals the freedom to schedule time-off without justifying the reason
-Reduces the incidence of unscheduled absences that can be disruptive to the workplace bc these policies require advance notice unless sudden illness is the cause
employee assistance programs
Help employees cope with personal problems that may impair their job performance such as alcohol or drug abuse, domestic violence, emotional impact, clinical depression, and eating disorders.
Outplacement Assistance Programs
Provide technical and emotional support to employees who are being laid off or terminated.
Why do companies offer tuition reimbursement programs and how do they work?
Employers offer this service to employees as a way to pay back employees for education expenses. This works by the student arranging for the school to charge the employer directly and or the student can pay tuition out of pocket and be reimbursed by their employer later.
Meet all of the minimum standard provisions, which permits employer and employee contributions to be made on a pretax basis
Refer to pension plans that do not meet at least one of the minimum standard provisions of the Employee Retirement Income Security Act. Neither employee nor employer contributions are permitted on a pretax basis
Defined Benefit Plan:
Guarantee retirement benefits specified in the plan document. They are usually expressed in terms of a monthly sum equal to a percentage of a participant's preretirement pay multiplied by the number of years s(he) has worked for the employer.
Defined Contribution Plan:
Employers and employees make annual contributions to separate accounts established for each participating employee, based on a formula contained in the plan document. Formulas typically call for employers to contribute a given percentage of each participant's compensation annually.
Why are defined benefit plans going out of favor with employers?
Employers face financial burdens. If contributions and investment returns are not enough to pay promised benefits the employer is responsible for making up the difference
What is a section 401(k) plan?
Named after the section of the IRC that created them. Also known as cash or deferred arrangements (CODAs). Permit employees to defer part of their compensation to the trust or a qualified defined contribution plan. Only private sector or tax-exempt employers are eligible to sponsor 401(k) plans.
What is the major risk to the employee if a company's 401(k) plan is funded by either a stock bonus plan or ESOP?
If the company runs into trouble, then not only would your job be in jeopardy, but your retirement, too.
What is health insurance and why do employers in the U.S. offer it to employees as a benefit?
Type of insurance coverage that pays for medical, surgical, and sometimes dental expenses incurred by the insured.
- Health insurance is offered to employees because it helps attract and retain quality employees
Provide protection against health care expenses in the form of a cash benefit
manage care plans
Emphasize cost control by limiting an employee's choice of doctors and hospitals
point of service plan
Combine features of fee-for-service systems and health maintenance organizations
HMO (Health Maintenance Organization)
Provides prepaid medical services. Most medical services are either fully covered or, in the case of some HMOs, participants are required to make nominal copayments.
Preferred Provider Organization (PPO)
Select group of health care providers agrees to furnish health care services to a given population at a higher level of reimbursement than under fee-for-service plans.
Flexible Spending Account (FSA):
Permit employees to pay for specified health care costs that are not covered by an employer's insurance plan
What are the legally required benefits in the U.S as of this fall?
Social security, Medicare, federal and state unemployment insurance, worker's compensation. These benefits are affected by federal and state laws.
How is Social Security funded?
Social security is paid both by the employer and the employee
How are unemployment insurance and workers compensation funded?
What are experience ratings and how can HR help a company reduce its expenses related to both unemployment insurance and workers comp?
The government's measure of how many people have you laid off in the past and what was the cost of providing them evidence
- The more people you lay off, the higher the wages, taxes will go up
Health insurance coverage for citizens age 65 and older
Medicare Part A:
Covers inpatient and outpatient hospital care and services
Medicare Part B:
Voluntary supplementary medical insurance
- Doctors' services, outpatient care, clinical laboratory services, some preventative health services, and ambulance services
Medicare Part D:
Medicare prescription drug program
Family and Medical Leave Act (FMLA):
12 weeks of unpaid leave for birth, adoption, foster care, serious family medical problems, worker's serious medical problem
- Retention of seniority, health insurance coverage, credit for previous service, and accrued retirement benefits
Employee benefit plan that allows staff to choose from a variety of pretax benefits.
Affordable Care Act (Obamacare):
Comprehensive health care reform law that addresses health insurance coverage, health care costs, and preventative care.
The Affordable Care Act requires certain employers with at least 50-full-time employees to offer health insurance coverage to their full-time employees.
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