Benefi ts 285package can assist in the recruitment and retention of qualifi ed employees.
Traditional benefi ts such as health insurance, retirement pensions, and
paid time away from work, combined with less traditional benefi ts such
as child and elder care, fl exible scheduling, and educational assistance, are
critical for attracting qualifi ed applicants, encouraging loyalty and long - term
employment, and motivating and rewarding incumbent employees.
Employee benefits often reach 40 percent of total compensation
costs. Medical insurance premiums are the highest - cost single benefi t.
Research conducted by the Kaiser Family Foundation and the
Health Research and Educational Trust found that premiums for
employer - sponsored health coverage rose an average 7.7 percent in- Premiums increased more than twice as fast as workers ’ wages
(3.8 percent) and overall infl ation (3.4 percent). Family health coverage
now costs an average of $ 11,480 annually, with workers paying an
average of $ 2,973 toward those premiums (Kaiser Family Foundation,
2006). Paid time off, vacations, holidays, and sick leave combined account
for about one - third of all benefi ts.
Employees often think of benefi ts as entitlements and not as compensa-
tion. In reality, the only entitlements are the benefi ts required by federal
or state laws, such as employer contributions to Social Security and Medi-
care or state pension plans, unemployment compensation, and workers ’
compensation. Aside from these, employers have tremendous discretion in
deciding what types of benefi ts to provide. This chapter discusses the variety
of benefi ts that organizations may choose to offer, as well as the quality - of - life
and quality - of - work issues that are becoming more prevalent in today ’ s
workplaces.
Required Benefi ts
All employers are required to contribute to Social Security, Medicare,
unemployment compensation, and workers ’ compensation benefi ts. Public
employers may be required by federal or state statutes to offer additional
benefi ts, such as retirement or disability. The benefi ts provided by nonprofi ts
are determined and approved by the board of directors.Social Security
Social Security provides retirement, disability, death, survivor, and Medicare
benefi ts for those beyond age sixty - fi ve. The Social Security system was