Sie sind auf Seite 1von 26

Employee Compensation

and Benefits

Mike Otis, Associate Director
Human Resource Services
Employee Benefits
3770 Beardshear Hall
Human Resource Services
Agenda
Typical HR Organization
Compensation Goals
Compensation Approaches
Benefits Exercise
Employer Challenges
General Benefit Concepts
Health Benefits
Welfare Benefits
Retirement Benefits
Closing Thoughts

Employee Benefits
3770 Beardshear Hall
Human Resource Services
Typical HR Structure
Employee Benefits
3770 Beardshear Hall
Human Resource Services
HR VP
Employee
Relations
Equal Opportunity
Diversity
Workers
Comp
Leave of Absence
Payroll
Benefits
Compensation
Employee
Assistance
Recruiting
Goals of Compensation Plans
Employers are able to attract and retain
employees who will contribute to the
organizations success
Employees feel they are
compensated/rewarded fairly/equitably
for their efforts and contributions to an
organizations success
Employee Benefits
3770 Beardshear Hall
Human Resource Services
Employee Benefits
3770 Beardshear Hall
Human Resource Services

Supportive Corporate Culture
Executive Sponsorship
Rewards
Bonus
Salary Increases
Promotions
Equity Offerings
Awards
Recognition
New job assignments
Salary
Pay
Overtime (if in non-exempt
classification)
Benefits
Health Plans
Retirement Plans
Vacation/ time off
Paid Training
Working Hours
Employee Satisfaction
Total Compensation
What Factors Determines Pay
Employer considerations
Where employers compete for talent local or
national
What talents an employer competes for the
skill/knowledge level
How strongly the employer wants to compete
Lead the market
Meet the market
Lag the market
Employee Benefits
3770 Beardshear Hall
Human Resource Services
What Factors Determine Pay?
What job duties will be performed determines classification as
either Exempt or Non-exempt (Governed by Fair Labor Standards
Act (FLSA))
Non-exempt employees.
Eligible for overtime pay for hours worked in excess of 40
Employer must have record of time worked
Exempt employees
Typically executive, professional, or administrative
positions
Must meet minimum weekly pay guideline
Not entitled to overtime
Must meet both salary test and duties test
Employee Benefits
3770 Beardshear Hall
Human Resource Services
Employee Benefits
3770 Beardshear Hall
Human Resource Services
Compensation Structure
Job
Classifications
Rewards/Recognition
Compensation Philosophy
Benefits
Benefits
Employee Benefits
3770 Beardshear Hall
Human Resource Services
Compensation Structure
Example
Grade Minimum Midpoint Maximum
Midpoint
Progression
Range
Width
12 $93,500 $131,000 N/A 14% N/A
11 $81,800 $114,500 $147,200 14% 80%
10 $71,800 $100,500 $129,200 14% 80%
9 $65,300 $88,200 $111,000 14% 70%
8 $57,200 $77,400 $97,200 14% 70%
7 $52,000 $67,600 $88,400 14% 70%
6 $45,600 $59,300 $73,000 14% 60%
5 $40,000 $52,000 $64,000 10% 60%
4 $37,800 $47,200 $60,500 10% 60%
3 $34,300 $42,900 $51,500 10% 50%
2 $31,200 $39,000 $46,800 8% 50%
1 $28,800 $36,000 $43,200 N/A 50%
Utopia Enterprises Your
Employer of Choice!
We provide a buffet
of benefit choices to
meet your individual
needs!!
Employee Benefits
3770 Beardshear Hall
Human Resource Services
Employee Benefits
3770 Beardshear Hall
Human Resource Services
Benefits Offered
Source: 2005 Iowa Employer Benefits Study, David P.
Lind and Associates
Offered by Employers with 250
or more Employees
Rank
Health Insurance 97.7% 1
Life Insurance 95.4% 2
Retirement Plans 94.4% 3
Paid Holidays 94.1% 4
Pre-Tax deductions for Employee benefit contributions 86.5% 5
Long Term Disability Insurance 84.1% 6
Paid Vacation 83.7% 7
Educational Assistance/Tuition Reimbursement 75.1% 8
Sick Leave 73.8% 9
Employee Assistance Program (EAP) 73.1% 10
Fitness Center or Gym subsidy 36.7% 11
Long Term Care Insurance 32.8% 12
Flextime 32.5% 13
Casual Dress (every day, not just Fridays) 32.2% 14
Retiree Health Insurance (post age 65) 25.6% 15
Telecommuting 18.9% 16
Child Care Assistance (on or off site) 7.4% 17
Subsidized employee meals Not on list 18
Free Coffee/Soda Not on list 19
Pet Insurance Not on list 20
Employer Challenges
Structuring employee benefit packages that meet
the needs of a diverse workforce one size does
not fit all
Helping existing employees understanding the
value of their benefits
Administering benefit programs costly and time-
consuming. Not a profit-making venture!
Continued rising health care costs
Limited budgets Benefits average 25% - 40% of
Payroll in most organizations
Government restrictions/legislation/public policy



Employee Benefits
3770 Beardshear Hall
Human Resource Services
General Concepts
Publicly traded companies will tend to
structure pay/benefits that incorporate more
equity (stock options, savings match in
company stock, bonus tied to company
performance, etc)
Non-publicly traded companies/organizations
will spend more on non-cash incentives
Governmental organizations will on average
spend more on benefits in lieu of salary


Employee Benefits
3770 Beardshear Hall
Human Resource Services
Core vs. Non-Core Benefits
Employee Benefits
3770 Beardshear Hall
Human Resource Services
Core Benefits
(Traditional)
Non-core Benefits
(Voluntary Elective)
Health Insurance Dental
Prescription Drugs Vision
Basic Life Insurance Supplement Life, Dependent Life
Vacation Long-term care insurance
Holidays Auto-homeowners insurance
Sick Pay Mortgage services/discounts
Disability On-site daycare
Tuition reimbursement
Yes, even Pet Insurance
Health Benefits
General types of health coverage
Medical
Prescription Drugs
Dental
Vision
Most health benefit employee
contributions will be deducted from pay
pre-tax




Employee Benefits
3770 Beardshear Hall
Human Resource Services
Wellness Programs
Many employers are starting to see the value from
incorporating wellness initiatives into their work places
disease management
health risk assessments
fitness programs
on-site clinics and pharmacies
Prevention vs. Payment
Improve productivity/reduce
absenteeism/presenteeism
Difficult to measure the Return on Investment (ROI) of
wellness programs



Employee Benefits
3770 Beardshear Hall
Human Resource Services
Welfare Benefits
Provide safety and monetary security beyond
health
Typical benefits
Basic life
Supplemental (optional) life
Accidental Death and Dismemberment (AD&D)
Dependent life insurance
Short-term disability (STD)
Long-term disability (LTD)



Employee Benefits
3770 Beardshear Hall
Human Resource Services
Vacation
May be provided under separate
program or combined under a PTO (paid
time off) plan with sick days


Employee Benefits
3770 Beardshear Hall
Human Resource Services
Retirement Benefits
Defined Benefit Plans (traditional Pension)
Based on a formula that determines a future benefit
Defined Contribution Plans (think 401(k))
future value depends on contributions from employee and/or
employer
403(b)/ 457 Not-for-profit employers
401(k) For-profit employers
Other Types - Deferred Compensation Plans
IRS restrictions


Employee Benefits
3770 Beardshear Hall
Human Resource Services
Comments on Retirement
Defined Benefit (Pension) plans are the
exception rather than the rule
Many employers now will automatically
enroll employees in 401(k)/403(b) plans
Understand the time-value of money
compounding
DIVERSIFY investments Many
employees are too conservative or too
risky




Employee Benefits
3770 Beardshear Hall
Human Resource Services
Employee Benefits
3770 Beardshear Hall
Human Resource Services
401(k), 403(b) Illustration

- saving
$100/month
- average 5% annual return
- retirement @ age 65

Age
# of
years
to save
Balance
@ Age 65
25 40 $152,602
40 25 $59,551

Opportunity
Loss $93,051

- with employer match of $50/month

25 40 $228,903
40 25 $89,326

Opportunity
Loss $139,577

Conflicting Priorities for
Savings/Retirement
Car payments/car insurance
Mortgage/rent/student loans
Utilities
Food/beverages
Clothing
Entertainment
Life expenses in general





Employee Benefits
3770 Beardshear Hall
Human Resource Services
Other Voluntary Benefits
Offered as optional benefits typically
employee pays full cost
Voluntary benefit programs typically offered at
a discount price resulting from group
purchasing power
Employer may offer the option of payroll
deduction
Examples are auto/homeowners insurance,
pet insurance, computer purchase discounts




Employee Benefits
3770 Beardshear Hall
Human Resource Services
Laws Affecting Employee
Benefits and Compensation
Fair Labor Standards Act (FLSA)
Employee Income Retirement Security Act of 1974 (ERISA)
Age Discrimination and Employment Act (ADEA)
Family Medical Leave Act (FMLA) of 1996
Economic Growth and Tax Relief Reconciliation Act
(EGTRRA) of 2001
Health Insurance Portability and Accountability Act of 1996
(HIPAA) (and amendments)
Pension Protection Act of 2006
many, many others



Employee Benefits
3770 Beardshear Hall
Human Resource Services
Closing Thoughts
Employee Benefits
3770 Beardshear Hall
Human Resource Services
How employees are compensated takes many forms salary,
benefits, working conditions, challenging/stimulating work, co-
workers, etc. The right mix for each person is different
Pay policies will differ for every employer some will focus on
cash compensation and some will focus on Total Compensation
The employers main goal is structuring compensation and
benefit programs is to be able to attract and retain the right
employees needed to help the employer be competitive

Closing Thoughts
Employee benefits have huge budget impacts to employers
Benefits are the hidden paycheck for employees
Employees need to understand the total compensation an
employer provides not just the salary. Employers need to sell
Total Compensation not just salary
Employees need to be educated consumers of benefit
programs especially health care and retirement programs
Employees should take advantage of retirement plan offerings
and save early (time value of $$) and always save enough to at
least take advantage of employers matching contribution
Employee Benefits
3770 Beardshear Hall
Human Resource Services

Das könnte Ihnen auch gefallen