Chapter 13: Employee Benefits and Services Flashcards
Employee benefits
indirect financial payments that an employee receives during his or her employment with an employer
Such as supplementary health and life insurance, vacation, pension plans, education plans, and discount on company products
Benefits as a percentage of gross annual payroll (for public and private sectors combined) are approximately______percent
10
Figure 13.1
Top Benefits Choices among Canadians
Top Three benefits
1) Additional week of paid time off
2) $500 salary increase
3) $500 employer contribution to TSFA / Retirement
Mandatory government benefits include:
1) employment insurance (EI),
2) pension plans (CPP/QPP),
3) workers’ compensation,
4) time off,
5) pay on termination of employment
How many Mandatory government benefits are tehre?
5
five
Employment Insurance (EI)
a federal program intended to provide temporary financial assistance to eligible persons who experience interruption to their work through no fault of their own
EI benefits are not payable when an employee is terminated for just cause
Qualifying period
Part of EI
To receive benefits, an employee must first have worked a minimum number of hours during a minimum number of weeks
Canada/Quebec Pension Plan (C/QPP)
CPP
Programs that provide three types of benefits:
Retirement income
Survivor or death benefits payable to the employee’s dependents regardless of age at time of death
Disability benefits payable to the employees with disabilities and their dependents.
Benefits are payable only to those individuals who make contributions to the plans or to their family members
The retirement pension (1/3 CPP benefits)
is calculated as 25 percent of the average earnings (adjusted for inflation up to the average inflation level during the last five years before retirement) over the years during which contributions were made
Disability benefits (1/3 CPP benefits)
only paid for severe disabilities that are expected to be permanent or to last for an extended period. The disability benefit is 75 percent of the pension benefit earned at the date of disability, plus a flat-rate amount per child
Survivor benefits (1/3 CPP benefits)
are paid on the death of a plan member. A lump-sum payment is made to the plan member’s estate, and a monthly pension is also payable to the surviving spouse and each dependent child.
Worker’s compensation
Provide income and medical benefits to victims of work-related accidents or illnesses or their dependents, regardless of fault
In practice, there are two basic approaches to reducing workers’ compensation claims:
First, firms try to reduce accident- or illness-causing conditions in facilities by instituting effective safety and health programs and complying with government safety standards.
Second, since workers’ compensation costs increase the longer an employee is unable to return to work, employers have become involved in instituting rehabilitation programs for injured or ill employees
All provinces, territories and the federal jurisdictions require unpaid leaves of absence to be provided to employees in certain circumstances
Word
_______________ leave is provided in every jurisdiction (usually after one year of service). The amount of maternity leave is 17 or 18 weeks in each jurisdiction (15 weeks in Alberta), but parental and _______ leaves range from 34 to 52 weeks.
Maternity and parental
adoption
integrated absence management
This starts with collecting data. For instance, how many people are on leave; how many days of work is the employer losing; how much is the employer spending to replace absent workers; and what units have the attendance problems? These employers then closely monitor all aspects of their employees’ leaves and absences.
The number of paid holidays similarly varies considerably from one jurisdiction to another, from a minimum of ____ to a maximum of ____
5 to 9
Advance notice
AKA Reasonable notice
Advance written notice required if the employer is going to terminate employment of a worker without just cause
Pay in lieu of reasonable notice
A lump-sum equal to an employee’s pay for the notice period provided to employees who cease working immediately
Severance Pay
an additional payout on top of the minimum notice period requirements, and only applies if the specific conditions in the applicable jurisdiction are met
Who pays into workers’ compensation?
PREMATURE QUIZ QUESTION
The employer alone.
Who pays into EI?
PREMATURE QUIZ QUESTION
Worker and Employer
Group Life insurance
Life insurance provided to lower rates for all employees, including new employees, regardless of health or physical condition
Accidental death and dismemberment coverage
provides a fixed lump-sum benefit in addition to life insurance benefits when death is accidental.
It also provides a range of benefits in case of accidental loss of limbs or sight, and is often paid for by the employer.
Critical illness insurance
provides a lump-sum benefit to an employee who is diagnosed with and survives a life-threatening illness
Deductible
The annual amount of health / dental expenses that an employee must pay before insurance benefits will be paid
Short-term disability plans
Salary continuation plans
Provide a continuation of all or part of an employee’s earnings when the employee is absent from work because of non-work-related illness or injury
Sick leave
Provides pay to employees when they’re out of work due to illness.
Most policies grant full pay for a specified number of sick days—perhaps 12 per year, usually accumulating at the rate of, say, one day per month of service.
Pooled paid leave plans (or “banks”)
These plans lump together sick leave, vacation, and personal days into a single leave pool
Disability management
A proactive, employer-centred process that coordinates the activities of the employer, the insurance company, and healthcare providers in an effort to minimize the impact of injury, disability, or disease on a worker’s capacity to successfully perform his or her job.
The Top Challenges in Improving How Mental Health Issues Are Addressed in the Workplace
1) Employee perception and stigma related to mental health issues (60%)
2) Lack of front-line manager awareness (54%)
3) Inability to identify suitable modified work (40%)
What is the difference between a deductible and co-insurance in supplementary health care?
PREMATURE QUIZ QUESTION
A deductible is a set amount per year, co-insurance is a percentage of the total cost.
Pension plans
Plans that provide income when employees reach a predetermined retirement age
Pension plans fall into two categories:
1) Defined benefit pension plans
2) Defined contribution pension plans
defined benefit pension plan
A plan that contains a formula for determining retirement benefits so that the actual benefits to be received are defined ahead of time
Example: the plan might include a formula, such as 2 percent of final year’s earnings for each year of service, which would provide a pension of 70 percent of final year’s earnings to an employee with 35 years of service
