Employee benefits and issues in setting or designing
employees benefits program
PRESENTED BY: MAHHAM TARIQ
DOHA EJAZ
KHADIJA UMAR
WARDA SHAHID
PRESENTED TO: MA’AM ASIYA GULL
DATE: 30TH DEC, 2020
Employees benefits in organization
Employee benefits, also known as perks or fringe benefits, are provided to employees
over and above salaries and wages. These employee benefit packages may include
overtime, medical insurance, vacation, profit sharing and retirement benefits, to name
just a few. Offering benefits to your employees is important because it shows them
you are invested in not only their overall health, but their future. A solid employee
benefits package can help to attract and retain talent. Benefits can help you
differentiate your business from competitors
Employees benefits in organization
Depending on the type of organization and the job, employee benefits may be quite
different. For example, government employee benefit packages for full-time employees
look very different from the packages offered to part-time employees. Employee
benefits packages are typically discussed during the final interview or at the time an
offer is extended. The right benefits package can give you a distinct advantage in
competitive recruiting situations.
Employees benefits in organization
There are some basic benefit laws all employers must follow. Required benefits include:
• Provide employees time off to vote, serve on a jury and perform military service
• Comply with all workers’ compensation requirements
• Pay state and federal unemployment taxes
• Contribute to state short-term disability programs in states where such programs exist
• Comply with the Federal Family and Medical Leave (FMLA)
Employees benefits in organization
Employers are not required to provide:
• Retirement plans
• Health plans
• Dental or vision plans
• Life insurance plans
• Paid vacations
• Holidays or sick leave
How to design an employee
benefits programme
Step 1: Identify the organization’s benefits objectives and budget
An important first step in designing an employee benefits program is to identify its
objectives. This will provide overall guidance in establishing the selection and design of
the benefits program. Generally, this process does result in a list of specific benefits
offered but rather provides an overview of the organization’s objectives of offering
benefits that reflect both the employer and employee needs. Factors such as employer size,
location, industry and collective bargaining agreements should be considered in the
development of the benefits objectives. Some employers choose to have general benefits
objectives, while others incorporate the objectives in their total compensation philosophy.
Step 2: Conduct a needs assessment
The needs assessment may include an employer’s perception of employee benefits needs,
competitor’s benefits practices and tax laws and regulations. But a more recent trend is to
take a market research approach to employee benefits planning. Common market research
techniques include employee inquiries in the form of personal interviews, simplified
questionnaires or sophisticated research methods. While employee feedback most likely
will result in higher employee motivation and satisfaction with the benefits package.
Analyze the existing workforce demographics to assist in determining the needs of various
categories of employees. Younger employees may value paid time off more, while older
employees may place a higher value on retirement income plans.
step 3: Formulate a benefits plan
program
Using the data collected from all resources in Step 2, the employer can
begin to formulate benefits offerings in order of priority. Then the employer
will determine the cost of providing the prioritized benefits and evaluate
against the benefits budget.
Step 4: Communicate the benefits plan to
employees
Good benefits communication objectives should include:
• Creating awareness and appreciation of the new or existing benefits and
improving employee financial security.
• Providing a high level of understanding of the benefits offered.
• Encouraging wise use of benefits.
Step 5: Develop a periodic evaluation process to
determine effectiveness of benefits
Periodically reviewing the benefits plan program is another important step in the
benefits management process. The benefits program must be assessed on a regular basis
to determine if it is meeting the organization’s objectives and employees’ needs.
Changes in the business climate, the economy, the regulatory environment and
workforce demographics all create dynamics that affect benefits offerings
Setting employees benefit is one of the most complex disciplines in
the field of human resources. Handling employee compensation
issues properly requires knowledge of:
Issues in Designing Employment trends
How to value job both internally and externally
Employees Benefit
How to adapt to varying financial conditions
Companies set benefits to help build, motivate and retain a
strong, innovative and productive workforce but face some of the
following challenges:
Staying Current in a Changing Market
Change in such competitive environment have resulted in an increase in job responsibilities for
HR departments. In addition to balancing their daily workload (recruitment, employee relations,
training, etc.), many HR professionals are having to learn new roles and skills. This includes
staying up to date and accurately collecting and managing employee data. With so many rules and
regulations to abide by, especially with respect to healthcare, companies are more at risk for
lawsuits, fines and penalties.
2) Balancing added responsibilities with day-
to-day duties
Traditionally, HR departments handle recruitment, workplace safety, employee relations,
labour law compliance, payroll, training and employee engagement. With an already highly
utilized team, employers are challenged to add the time-consuming tasks of managing
progressive benefit strategies, exacting budgetary processes, and staying compliant with the
evolving healthcare legislation. Employers face countless challenges around their benefits from
employee education to enrolment to administration.
3) Perceived compensation equity among
employees
Employees each have their own perception of internal equity as it affects them among their
peers, managers and subordinates. If an employee believes they are underpaid, they will
typically react by reducing their effort or performance. This may result in, for example,
increased absenteeism and sick leave, tardiness, unmet deadlines, excessive work breaks, lack
of focus
4)Appealing to different demographics
Creating a benefits strategy that appeals to all ages and demographics is extremely tough, if not
impossible. While health, dental plan are important, a significant percentage of the workforce
also highly values a flexible work schedule and vacation policy. The importance of recognizing
that different groups of people value different things when it comes to benefits cannot be
understated.
Small Businesses face a lot of issues while setting their employees benefits as they have less budged
and want to survive in such competitive environment Small businesses meet the challenges with fewer
resources than large companies some of issues they face are as following:
Company Cost
Employee benefits are a normal part of doing business, but for a small business the cost can have a
greater impact on profit, cash flow and decisions about investment, expansion and hiring..
Employee Cost
Small-business employees often pay higher portions of the cost of employee benefits plans that offer
fewer choices, less flexibility and frequent changes in providers and policies that occur when small
businesses shop and negotiate for lower prices
EXAMPLE 1
Nayatel:
The employees of NAYATEL are entitles to the following benefits:
Performance based annual/fast track promotion as per skill set
Leaves:
• 20 casual/annual (encashable) leaves
• 40 medical leaves
• 5 marriage leaves
• 10 leaves for Hajj
• 5 leaves for Umrah
EXAMPLE 1 (Contd.)
Performance based 10% annual increment
Life insurance
Provident fund
EOBI
Annual performance rewards
Quarterly performance rewards
Medical facility for:
• Employee
• Spouse
• Children
EXAMPLE 2
• IBM (International Business Machines):
International Business Machines (IBM) Corp. employees receive many pension and
welfare benefits. Namely:
Retirement and financial benefits:
• Profit sharing
• 401(k) retirement plan
• Defined benefit pension plan
• Defined contribution pension plan
EXAMPLE 2 (Contd.)
Health and insurance benefits:
• Health insurance
• Life insurance
• Dental insurance
• Vision insurance
• Long-term disability insurance
• Temporary disability insurance
• Severance pay
• Accidental death and dismemberment insurance
Conclusion
• Offering benefits to your employees is important because it shows them
you are invested in not only their overall health, but their future as well.
A solid employee benefits package can help to attract and retain
talent. Benefits can help you differentiate your business from
competitors.
• In accordance with the constitutional provision of article 38, Government
of Pakistan started a social insurance scheme in Pakistan for the private
sector employees. Under this scheme, four types of benefits are provided.
