Compensation & Benefits Flashcards
enacted in 1932
FLSA
must earn more than $684/week, salaried, or must perform certain duties.
Exempt employees
passed in 1931 and first federal legislation to mandate that laborers and mechanics be paid the prevailing wage on public works projects
Davis-Beacon Act
the usual wage, benefits, and overtime that are paid in the largest city in each county to the majority of workers on a public works projects
Prevailing wage
protects employees working under government contracts from working for substandard wages. Many provisions incorporated into the FLSA
Walsh-Healy Public Contracts Act of 1936
commute time is not compensable, but that employers must compensate workers for performing job-related tasks outside of work hours or during lunch breaks
Portal-to-Portal Act
prohibits employers from discriminating against older employees when it comes to benefit plans
Older Worker Benefit Protection Act of 1990
reduced the existing age limits restricting participation in pension plans. Also provided more protections for survivors or employees entitles to pensions, requiring that written approval be received from a spouse rejecting supervisor benefits and restricting conditions that could be placed on survivor plans
Retirement Equity Act of 1984
protects employees when they are entitles to pension plans, but those do not have the funds necessary to provide the promised benefits. Also, employers permitted to enroll employees in 401K plans automatically and employees have to opt-out.
Pension Protection Act of 2006
requires that insurers provide the same limits for mental health services. Does not require insurers to offer mental health benefits
Mental Health Parity Act of 1996
extra pay, aka premium pay, given to a worker to compensate for the danger, inconvenience, or added cost of a specific job or assignment
differential pay
pay 1.5x base pay for hourly workers who work 40+ hours per week
overtime
additional pay given to compensate employees for working less desirable shifts, i.e. the second or third shift
shift pay
additional pay to a worker who is “on call” - not actively working but available.
on-call pay
extra money above the base rate, paid to workers who are called back to work after their regular work hours are over and they have left the workplace
call-back pay
a minimum payment, required in some states but not by federal law, made to compensate workers who report for work but are not asked to put in a full day of work
reporting pay
additional money paid to compensate employees who are assigned to work in a dangerous location or in hazardous conditions
hazard pay
extra money paid to employees in one location to account for the higher cost of labor, or higher cost of labor, or higher cost of living, relative to other locations where the company has employees
geographic pay
the use of a job grading structure with extremely wide salary bands
broadbanding
employee’s compensation falls below the minimum of the compensation range
green circle
employee’s compensation is above the maximum compensation for their salary range
red circle
the inequity that arises when new employees demand, and receive, higher wages than current employees who are performing the same job
wage compression
a measure of how an individual employee’s pay relates to the pay ranges established by the organization and the larger market. It is defined as the employee’s salary, divided by the midpoint of the salary range for that position
compa-ratio
process that categorizes all jobs at a company according to the level of responsibility and skills required
job evaluation
ensuring that the pay levels within an organization correspond to the level of responsibility and skills required for the job
internal equity
the comparison of the pay levels of a company to other companies to ensure that the levels are comparable
external equity
a federal law that establishes minimum standards for retirement and health plans
Employee Retirement Income Security Act (ERISA)
pre-tax in the beginning
traditional IRAs
taxed in the beginning
Roth IRAs
retirement plan that involves employers setting aside money in retirement accounts for employees
Simplified employee pension plans (SEP)
these tests ensure highly compensated employees do not benefit unduly from 401K plans at the expense of other employees
Actual Deferred Percentage Tests
permits employees over the age of 50 to make greater contributions to 401k plans and make catch-up contributions
Economic Growth and Tax Relief Reconciliation Act (EGTRRA)
legal orders that enforce alternative payee arrangements, which are directed by an employee
Qualified Domestic Relations Orders (QDRO)
particular dollar amount is paid for each year of an employee’s service
flat dollar approach
percentage of average pay multiplied by years of service
career average
based on average annual earnings during a specified time at the end of their career
final pay approach
employee’s total benefits are updated annually with a credit based on their earnings for the year, interest at a fixed or variable rate, or both.
cash balance plans
for if you are 65+ years old, you have end stage renal disease, or you have been collecting disability for 2+ years
Medicare
Medicare Part __: hospital insurance (mandatory, no fee)
Medicare Part A
Medicare Part __: medical insurance (not mandatory, fee)
Medicare Part B
AKA Medicare Advantage, alternative to parts A & B
Medicare Part C
Medicare Part __: prescriptions (optional, fee, and must be eligible for A & enrolled in B)
Medicare Part D
