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12 Cards in this Set

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Employee Benefits

Any type of compensation other than direct current wages paid to EE.
Total Compensation

(current cash salary) + (value of EE benefits)

Types of Loss Exposures managed into EE benefit Plan (3)

1. medical expenses for EE. 2. loss of income to EE(or EE dependents) 3. loss of productivity to an ER.

Why are EE benefits important for ER?

1. firms spend about 40% of payroll on benefits. 2. second largest expense behind payroll. 3. health insurance is very expensive.
Types of EE benefits to meet loss exposures. (5)


1. medical expenses. 2. loss of income due to retirement. 3. loss of income due to disability. 4. loss of income due to unemployment. 5. loss of income due to death.


1. Medical Expenses for an EE.


A) Traditional Indemnity Plans. B) Managed Health Care Plans. C) Consumer Driven Health Plans. D) Specialty Coverages for Narrow Defined Perils.


2. Loss of Income due to retirement.


- "Pension plan"


- Defined Contribution Plan


- 401 k % 403 b


- SOCIAL SECURITY RETINREMENT BENEFITS




3. Loss of income due to disability.


- occupational disability (workers comp)


- non-occupation disability (sick leave, short term, long term,


-SOCIAL SECURITY DISABILITY BENEFITS




4. Loss of income due to unemployment.


- severance package


-UNEMPLOYMENT INSURANCE




5. Loss of income due to death.


- life insurance


*Group term life insurance


-SOCIAL SECURITY SURVIOR BENEFITS


-WORKERS COMP DEATH BENEFITS


-survivor benefits under retirement plans.



Which benefits are required to be offered?


-Health Insurance


-Social Security retirement benefits


-Workers Comp


-SS disability benefits


-Unemployment insurance


-SS survivor benefits


- Workers comp death benefits


(OASDI,WC,U.I.)


Why do firms offer EE benefits as part of COMPENSATION?

1. take advantage of group insurance


2. to attract/retain capable EE


3.to enhance productivity of EE


4. Income tax advantages


($1 salary-> .40 benefits)


vs ($1.40 in salary w no benefits)