Insurance as salary component
The modern approach to compensation and employee benefit plans helps in recognizing and rewarding your best employee(s). Improvement in productivity and employee-retention are the natural outcome of effective employee benefits strategies. One should have a look at these employee benefits resources that emphasize current trend in employee benefits administration.
Health insurance is essential for a comprehensive employee benefits package and is the preferred employee benefit for working professionals. Health insurance is responsible for making an employer the employer of choice for their prospective employees and job hunters. If you are in a position to afford just a few employee benefits, then make sure you choose health insurance as it may be the best gift for the employees and their families.
Short Term Disability Insurance
The T&C of short term disability insurance state that a certain part of an employee’s salary would be provided to him, even if they are unable to show up for work due to illness or an injury that disables him. This short-term disability coverage is also a part of comprehensive employee benefits package and is recommended for certain industries such as construction etc. This insurance also provides protection for employees, who prefer to work on long term basis. Such employers would definitely wish to include short term disability insurance in the employee benefits package.
Long Term Disability Insurance
The long term disability insurance is a kind of policy that helps an employee to save his income in case he or she is unable to work for a long period of time due to illness, injury or accident. Recent figures state that an average employee misses 2.5 years of work in case of long term disability. Long term disability insurance is one of the most critical components of an employee benefits package, as 20% employees have a chance of getting disabled or unable to work for a long period.
There are many types of dental insurance plans which the employers can offer to their employees as part of the Comprehensive Employee Benefits Package. The dental insurance plan covers both the preventative and emergency dental care. With the help of this insurance the employees can cover their dental expenses. This insurance, sometimes can also be availed through employer’s health insurance carrier with minimum charges, thus making dental insurance an inherent part of the employee benefits package.
Vision Insurance is also a part of the comprehensive employee benefits package provided by the employers. This insurance is optional for the employers to make it a part of the comprehensive employee benefits, but it ensures that its employees have regular checkup and examination of their vision. The employer also pays for the cost of corrective equipment thus making it a desirable and valuable part of the employee benefits package.
Life insurance is an accepted, prevalent and most desired component of the employee benefits package as the employees expect and treat life insurance as the most beneficial and attractive part of it.
Part II: Paid Vacations
Paid Time Off From Work
A comprehensive employee benefits package is not at all complete without the inclusion of paid time off from work. As part of the package, the employees get a variety of options for paid time off wherein the employers provide a number of days, which are classified in such a way that is suitable for both employers and employees. Various kinds of paid time off from work include:
- Paid vacation days
- Paid personal days
- Paid holidays
- Paid sick days
- Funeral leave
Reasons like simplicity and lack of desire in employees to take care of time off are pushing employers to opt for paid time off policies that eliminate the need for vacation etc.
Paid vacations are actually a kind of time off work which a company provides to its workforce as a part of benefits. The number of paid leaves is generally calculated based on the employees years of service with the company along with the designation held. The Federal Law in US does not enforce or recommend paid vacations to be implemented mandatorily by the employer; it’s fully upon the discretion of the employer to offer paid vacations.
The paid vacation benefits are so common that the employees expect them as a part of the comprehensive benefits package. Most of the organizations offer a certain number of hours off during each pay period with the company. The paid vacations in the US range from 5 to 30, whilst in many parts of the world, paid vacation policies are much more flexible.
According to a study at salary.com, done by the Society for Human Resource Management in the year 2004, benefits were described as follows:
- An employee with one year of service receives around 9 paid vacation days
- An employee with two years of service receives around 10 paid vacation days
- An employee with three to four years of service receives around 12 paid vacation days
- An employee with five years of service receives around 14 paid vacation days
- An employee with six to seven years of service receives around 15 paid vacation days
- An employee with eight to nine years of service receives around 16 paid vacation days
- An employee with ten years of service receives around 17 paid vacation days
- An employee with 11 to 13 and 14 to 15 years of service receives around 18 and 19 paid vacation days, respectively.
Advantages of Paid Time off Policy
- This policy facilitates the employees to use paid time off at their own discretion, since the employers treat them as adults
- This policy empowers the employers with certain checks over the unscheduled absence from work, which is also an issue related to productivity and commitment
- Employees like the flexibility offered by paid time off policy
Disadvantages of Paid Time off Policy
- Recent stats reveal that new employees are slower in accumulating their paid time off as compared to the long term employees
- Employees consider paid time off as a benefit and have a tendency to utilize all the time off awarded
- Employees consider the paid time off as their vacation time while they show up for work when they are down with illness
*Salaries are subject to change with time and may vary with company policies, general economic scenario and other factors mentioned above