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Canada (158,059)
Commerce (1,633)


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McMaster University

Commerce 2BC3 Chapter 12: Managing Employee Benefits - Employers provide benefits to their workers for being part of the organization Benefit: Is an indirect reward given to employee or a group of employees for organizational membership - They often include retirement plans vacations with pay extended health insurance educational assistance and many marked programs - They are costly for the typical employer Strategic perspectives on benefits - Benefits should be looked at as a vital part of the overall compensation strategies of the organization Benefits as competitive advantage - Employers offer some benefits to recruiting and retention some because they are required to do so and some simply because doing so reinforces the company philosophy of social and corporate citizenship - Employers with good benefits argued positively within a community and the industry by customers, current employees, and workers in other firms - Benefits offered could aid in reducing employee turnover which makes the organizational performance benefit Workforce attraction retention - The composition of the Canadian workforce is changing and expectations of different generations of employees are affecting benefit decisions - It is well established that benefits influence employees decisions among which particular employee to work for while or just stay with or leave an employer, or to retied - A major advantage of benefits is that they generally are not taxed as income to employees and for this reason they represent as somewhat more valuable reward to employees than an equivalent cash payments Benefits design benefit plans: Can provide flexibility and choices from employers or can be standardized for all employees - Employers are finding that providing employees with some choices and flexibility allows individuals to tailor their benefits to their own situations - However, the more choices available, the more administrative demands are placed on the organization and number of decisions are part of benefits design - For example, why is each type of benefit offered? - Which employees should be given or offered which benefits? - How flexible should the package of benefits the total benefits costs can be funded by contributions from both the employer and the employee? Part time employee benefits - Many employers do not provide part-time employee benefits except some time off leave benefits Common Measurements Benefits Effectiveness As a percentage of payroll (pattern over a multi-year period) Benefits expenditures per full-time equivalent (FTE employee) Benefits costs by employee group (full time vs. part time, union vs. nonunion, office, management, professional, technical, etc.) Benefits administration costs (including staff time multiplied by the staff pay and benefits costs per hour) Health-case benefits costs per participating employee - Other metrics are used to measure the return on expenditures for various benefits programs provided by the employers - Some common benefits that employers track using HR metrics are worker's compensation, wellness programs, and disability insurance. - The point is that both benefit expenditures generally and costs for individual benefits specifically need to be measured and evaluated as part of strategic benefits Management types of benefits - A wide range of benefits are offered by employers Government mandated security benefit - There are many mandated security benefits that employers in Canada must provide to employees under federal, provincial and territorial laws Canada Qubec pension plans CPP QPP Canada's major pension plans providing regular payments to people in retirement who have contributed to either of these plans or bought over the years - Benefit payouts are based on the number of years you've worked and your earnings during that time are adjusted to keep pace with inflation of your retirement pension which is not started automatically. - You must apply for it CPP QPP officially starts at age 65 but you can apply to receive it as early as your 60th birthday or as late as the age of 70 Disability payments as CPP TPP- Disability benefit is available to people who have made enough contributions to the CPP TPP and their disability prevents them from working at any job a regular basis and the disability must be long-lasting or likely to result in death - The Canada pension plan disability vocational rehabilitation program is designed to help people to receive a CPP disability benefit to return to work Survivor benefits: Are paid to a deceased in control estate surviving spouse or common-law partner and dependent children - There are 3 types: 1) Death benefit is a one time payment to or on behalf of the estate of the deceased CPP to TPP contributor 2) The CPP TPP survivors pension is paid to the person who at the time of the death is a legal spouse, partner of the deceased contributor If you are separated legal status and there is no cohabitating partner you may qualify for this benefit 3) CPP TPP children's benefit is paid to a dependent natural or adoptive child of the deceased contributor or child in the care and control of the deceased contributor at the time of death *The child must be either under age 18 or between the ages of 18 and 25 and full-time attendance at a school or university Old age security (OS) - Provides a monthly retirement benefit based on your age and the amount of time you have lived in Canada - They include the basic OAS pension and the guaranteed income supplement -GIS detention is not based on income it's a taxable fully indexed benefits available to all Canadian residents 65 and older to get the OAS benefit you have to apply for it at least six months prior to reaching age 65 Guaranteed income supplement (GIS) - Is an additional monthly benefit paid to residents of Canada to receive a basic full or partial OAS pension and you have little or no other income Employment insurance: Temporary financial assistance for unemployed Canadians - People who look forward or upgrade their skills, Canadians who are sick pregnant or caring for a new born or adopted child as well as those who must care for family member who seriously else with significant risk of death may also be assisted by the basic benefit - As of 2009 the basic benefit rate was 55% of average earnings up to a maximum of $447 per week -EI payment is a taxable income and regular benefits can be paid from 14 to a maximum 45 weeks - Compassionate care of benefits are available as an employee has to be away from work temporarily to provide care or support a family member was gravely
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