HRM 200 Lecture 8: Chapter 13 and 14 Employee Benefits and Services and Occupational Health and Safety

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Chapter 13: Employee Benefits and Services
Learning Outcomes
EXPLAIN the strategic role of employee benefits.
DESCRIBE six government-sponsored benefits.
EXPLAIN why the cost of health insurance benefits is increasing and how employers can reduce
these costs.
DESCRIBE the two categories of pension plans and the shift that is occurring in their relative
popularity.
DISCUSS three types of personal employee services and seven types of job-related services
offered to employees.
EXPLAIN how to set up a flexible benefits program.
The Strategic Role of Employee Benefits
Employee Benefits
o indirect financial payments given to employees
o may include supplementary health and life insurance, vacation, pension, education
plans, and discounts on company products
o becoming larger part of total compensation
o useful in attracting talent
o increasingly important for aging workforce
Government-Mandated Benefits
o Employment Insurance (EI)
a federal program that provides income benefits if a person is unable to work
through no fault of his or her own
eligibility
benefit period
funding
supplemental unemployment benefit (SUB)
o Pay on Termination of Employment
does not apply to those on short-term contract or fired for just cause
amount of payment varies according to jurisdiction and circumstances:
pay in lieu of reasonable notice
severance pay (Ontario and federal jurisdiction only)
pay for mass layoffs (some jurisdictions)
o Leaves of Absence
unpaid time off
conditions vary by jurisdiction
employer must guarantee same or similar job when employee returns
common types:
o maternity/parental leave
o parental/adoption leave
o bereavement leave
o compassionate care leave
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o Canada/Quebec Pension Plan (C/QPP)
programs that provide basic level of security on retirement
three types of benefits:
retirement income
survivor or death benefits
disability benefits
benefits based on individual contributions made
o Workers’ Compensation
no fault insurance plan
income and medical benefits to victims of work-related accidents or illnesses,
regardless of fault
funded collectively by employers
administered by jurisdictional orkers’ compensation boards
Paid Time Off
o Vacation
minimum amount of paid vacation must be provided to employees
o Holidays
varies by jurisdiction
minimum 5 days, maximum 9
o Paid Breaks
uninterrupted break within a work day
e.g. 30 minute break on a shift over 5 hours
Voluntary Employer-Sponsored Benefits
o Life Insurance
o group plans offer lower rates and inclusion of all employees
o additional benefits:
accidental death coverage
dismemberment coverage
critical illness insurance
Supplementary Healthcare/ Medical Insurance
o supplements provincial healthcare plans
o group rates lower than individual rates
o employee usually pays a yearly deductible amount
o usually includes prescription drugs, private/semi-private hospital rooms, other health
costs not covered by provincial plans
o may include dental, vision care, hearing aids
Reducing Health Benefit Costs
o increase amounts paid by employees
o restrict drugs paid for by plan
o health promotion
o risk-assessment programs
o healthcare spending accounts (HCSA)
Short-Term Disability
o provides income to employees when absent due to non-work related injury or illness
o requires medical certificate
o usually covered by insurance company
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Sick Leave Plans
o provides income for 2 or 3 days
o usually a specified number of sick days per year
Long-Term Disability Plans
o income to employees for absence due to non-work related long-term injury or illness
o usually 50% to 75% of pay
o accelerating trend in claims
o disability management
o mental health issues are leading cause of disability claims
Sabbaticals
o time off to rejuvenate or pursue personal goals
o usually unpaid
o helps retain employees and avoid burnout
Retirement Benefits
o Defined Benefit Pension Plan
benefits formula based on
earnings and years of service
o Defined Contribution Pension Plan
benefits based on amount of
contribution and value of fund
o Group RRSP
employer sets up RRSP fund
deferred profit sharing plan
(DPSP)
portion of profits is put into fund
Employee Services
o Flexible Work Schedules
Flextime
Telecommuting
Compressed workweeks
Job sharing
Work sharing
Personal Services:
o credit unions
o counselling services
o employee assistance programs (EAPs)
o other personal services (social and recreational)
Job-related Services:
o subsidized childcare
o eldercare
o subsidized employee transportation
o food services
o educational subsidies
o family-friendly benefits
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