fringe benefits report
TRANSCRIPT
-
8/6/2019 Fringe Benefits Report
1/13
~ 1 ~
TABLE OF CONTENT
1) INTRODUCTION [2]1.1) DEFINITION OF FRINGR BENEFITS [2]1.2) MEANING [2]1.3) PERQUISITES [3]
2) OBJECTIVES [5]3) TYPES OF FRINGE BENEFITS [6]4) FRINGE BENEFITS A WAY TO INCREASE EMPLOYEE
PRODUCTIVITY [8]
5) BEST WAYS OF DEALING WITH DIFFICULT EMPLOYES [9]6) EMPLOYEE BENEFITS [10]7) ADVANTAGES OF FRINGR BENEFITS [12]
7.1) ADVANTAGES FOR EMPLOYERS [12]
7.2) ADVANTAGES FOR EMPLOYEES [12]
8) DISADVANTAGES OF FRINGE BENEFITS [12]
9) LIVE EXAMPLE OF COMPANY [13]
-
8/6/2019 Fringe Benefits Report
2/13
~ 2 ~
1. INT TION:
1.1Definition of Fringe Benefits:
As perSection 115WB (1) ,narrated in Column 1 of Part A, fringe benefits means
any consideration for employment provided by way of any privilege, service, facility
or amenity, directly or indirectly, provided by an employer, whether by way of
reimbursement or otherwise, to hisemployees.
1.2Meaning:
Fringe benefits are compensations made to an employee beyond the regular benefit of
being paid for their work.
Some fringe benefits are fairly standard, such as offering a few days of sick time
or paid vacation time. Others can be significantly greater, and rarer. Key executives in
large companies might also enjoy fringe benefits like use of time-
share condominiums, paid continuing education, use of a company jet, use of a
company credit card, discounted or free health club memberships, and a significant
amount of paid vacation.
-
8/6/2019 Fringe Benefits Report
3/13
-
8/6/2019 Fringe Benefits Report
4/13
~ 4 ~
Here ismore informationabout fringebenefits.
Flexiblebenefits allowemployees topickbenefits that most theirneeds. The
idea is to allow each employee to choose abenefit package that is individually
tailored tohisorherownneedsandsituation. It replaces the traditional one-benefit-
plan-fits-allprograms that dominatedorganizationsformore than 50 years.
The average organizationprovides fringebenefits worth approximately 40%
ofan employeessalary. Traditional benefit programs were designed for the typical
employeesofthe1950s -amalewithwifeand twochildrenat home. Less than10%
ofemployeesnow fit thisstereotype. While 25% oftodaysemployeesaresingle,a
third ispart oftwo-incomefamilieswithnochildren.
Thethreemostpopulartypesofbenefitplans:
1. Modular plans: They are pre-designed packages of benefits, with eachmoduleput togethertomeet theneedsofaspecificgroupofemployees. oa
moduledesignedforsingleemployeeswithnodependentsmight includeonly
essentialbenefits. nother,designedforsingleparents,might haveadditional
life insurance,disability insurance,andexpandedhealthcoverage.
2. Core-plus plans: It consist of a core of essential benefits and a menu-likeselectionofotherbenefitsoptionsfromwhichemployeescanselect andadd to
thecore. Typically,eachemployee isgiven benefit credits, whichallow the
purchase ofadditionalbenefits that uniquelymeet hisorherneeds.
3. Flexiblespendingplans: Theyallowemployees toset asideup to thedollaramount offered in theplan topay forparticular services. Its a convenient
way,forexample,foremployees topayforhealth-careanddentalpremiums.
Flexible spending accounts can increase employee take-homepaybecause
employees dont have topay taxes on the dollars they spend out of these
accounts.
-
8/6/2019 Fringe Benefits Report
5/13
~ 5 ~
Most companiesrealize that fringebenefits likehealth insurancecontribute to
the well being of their employees. Wheneverpossible, they try to offer a t least
partiallydiscounted insurance toanemployee,even iftheyarenot legallyrequired to
do so. Fringebenefits like sick or vacation time tend tobe fairly standard as well,
even ifanemployeedoesnot work full time. Thesepaiddaysoffdo tend tohavea
capon them.Forexample,anewemployeemight get aweeksvacation time tostart,
andeight to tendaysofsicktimeforyear. Employeesenteringhigher-levelpositions
maybeofferedgreaterfringebenefitsas incentive to joinacompany.
In fields where there is a high demand for workers, such as nursing and
teaching, some unusual fringebenefits maybe offered to attract employees. mall
school districtshavegotten quitecreative in thisrespect,since teachersalariesarestill
relatively low. few unusual fringebenefits offeredby school districts havebeen
paid housingor use ofprivate lakes for fishing. More likely arepaid incentives for
joininga teachingstaffsuchashiringbonuses,offers tofundcontinuingeducationso
teachersget higherdegreesand thushigherpay,orofferingmentorprogramsfornew
teachers.
ometimes thefringebenefits turnout tobegreatlyneeded.Forexample, the
risingcost ofprivatehealth insuranceoftenmakesobtaininga jobwithagoodhealth
plan highly desirable. Where job compensation is not commensurate with money
needed to livecomfortably,housingallowances,orcompanyhousingcanoftenmake
thedifferencebetweenbeingable to takea joband lookingelsewhere.
omecompaniesalsopay fringebenefitsforthosewho worknight orswing
shifts. These fringebenefits maybe in the nature of a 1030% increase ofbase
payfor working a non-standard shift. This is called a shift differential and is quite
common in themedical fieldand inmanufacturing.
2. OBJECTIVES:
Theviewpoint ofemployers is that fringebenefitsforman importantpart of
employee incentives toobtain theirloyaltyandretaining them. The important
objectivesoffringebenefitsare:
-
8/6/2019 Fringe Benefits Report
6/13
~ 6 ~
1. To create and improve sound industrial relations.. To boost up employee morale.. To motivate the employees by identifying and satisfying their unsatisfied needs.. To provide ualitative work environment and work life.. To provide security to the employees against social risks like old age benefits
and maternity benefits.
6. To protect the health of the employees and toprovide safety to the employeesagainst accidents.
7. To promote employee s welfare by providing welfare measures like recreationfacilities.
8. To create a sense of belongingness among employees and to retain them. ence,fringe benefits are called golden hand-cuffs.
9. To meet re uirements of various legislations relating to fringe benefits.
3. T ES OF FRINGEBENEFITS:
Organi ations provide a variety of fringe benefits. The fringe benefits are classified
under four heads as given here under:
-
8/6/2019 Fringe Benefits Report
7/13
~ 7 ~
a. ForEmploymentSecurity:Benefits under this head include unemployment, insurance, technological
adjustmentpay, leave travelpay,overtimepay, level fornegotiation, leavefor
maternity, leaveforgrievances,holidays,cost oflivingbonus,call-backpay,
lay-off, retiring rooms, jobs to the sons/daughters of the employees and the
like.
b. ForHealth Protection:Benefits under this head include accident insurance, disability insurance,
health insurance, hospitalization, life insurance, medical care, sickbenefits,
sickleave,etc.
c. ForOldAgeandRetirement:Benefitsunderthiscategory include:deferred incomeplans,pension,gratuity,
provident fund,oldageassistance,oldagecounselling ,medical benefits for
retired employees, travelling concession to retired employees, jobs to
sons/daughtersofthedeceasedemployeeand the like.
d. ForPersonnelIdentification, ParticipationandStimulation:This category covers the followingbenefits: anniversary awards, attendance
bonus, canteen, cooperative credit societies, educational facilities, beauty
parlour services, housing, income tax aid, counselling, quality bonus,
recreationalprograms,stresscounselling,safetymeasuresetc.
Thefringebenefitsarecategorizedasfollows:
a) Paymentfor Timenot worked: Benefits under this category include: sick leave
withpay,vacationpay,paidrest andrelieftime,paid lunchperiods,grievance time,
bargaining time, travel timeetc.
-
8/6/2019 Fringe Benefits Report
8/13
~ 8 ~
b)Extra Payfor time Worked: This categorycovers thebenefitssuchas:premium
pay, incentivebonus,shiftpremium,oldage insurance,profit sharing,unemployment
compensation, Christmasbonus, Deewali orPoojabonus,foodcost subsidy,housing
subsidy,recreation.
4. FRINGE BENEFITS - A WAY TO INCREASE
EMPLOYEE PRODUCTIVITY
Manypeoplebelieve that increasingfringebenefits,orbenefits that arenot mandated,
establishes loyaltyandboostsproductionamongemployees. omeargue thesebeliefs
are incorrect,but manyotherssupport them.
It wouldbedifficult toexamine theeffectsofallpossiblefringebenefits,but looking
at afewcangiveemployersasenseofhowemployeeproductivitymightbe increased
byofferingfringebenefits.
ome countries offerfree healthcare,but in other countries,people need tobuy
insurance. fferinghealth insurance isafringebenefit,and the qualityofit couldbe
directly tied toemployeeproductivity. Ingeneral,sickemployeesarenot productive
employees, and any insurance offered to workers shouldbe affordable and offer
reasonableamounts of coverage. ffordability shouldadditionally take intoaccount
things likecopaymentsanddeductibles.
sgreat asfringebenefitsmaybewhen it comes to increasingemployeeproductivity,
theyarent toohelpful underbadworkingconditions. Employeesdeservebasicrights,
likebeing treatedwithrespectbysupervisorsandbeingpaidfairlyfortheirwork. ll
thebenefits in theworldmaynot makeupforconsistentlypoormanagement skillsor
under-marketpay.
-
8/6/2019 Fringe Benefits Report
9/13
~ 9 ~
5. BEST WAYS OF DEALING WITH DIFFICULT
EMPLOYEES:
There are several types of difficult employees who can make thework
environment miserable and unproductive for everyone in the workplace. The
personalities involved maybevaried,but therearebasicactionshelpful indiffusing
most situations. These include acknowledgment of theproblem, listening to all
concerns and identifying theproblem, andproviding constructive feedback when
dealingwithdifficult employees.
omepeoplefeel iftheproblem is ignored, it will goaway. Thesimple truth is, like
most problems, ignoring the issueofdealingwithdifficult employeesoften leads to
moreproblems. Thebest courseofaction is toacknowledge there isaproblem and
implement aplan to ease concerns. Getting to thebottom of the issue as soon as
possiblecan lead toasmoothandswift resolution.
supervisorormanagershouldresearch theproblempersonally insteadofrelyingon
thewordofanotheremployee. Listeningskillsarevery important at thisstage toget
the full story and to understand exactly what the issues are. The manager should
address theproblemcalmly,allowing theemployee time torespond. Clearexamples
oftheproblemsexperiencedshouldbeprovided,remembering toaddress theactions
andnot thepersonal aspectsoftheperson involved.
Identifying thepersonalityoftheemployee in question isakeycomponent todealing
withdifficult employees.Perfectionists will often takecriticismpersonally,whereas
unproductive employees may not acknowledgeconstructive criticismat all unless
clear examples and expectations are shown. Documentation and follow-up are also
important when dealing with difficult employees, especially if termination is
considered.
Termination isanoption,but researchhasshown it is morecost effective to tryand
resolvedifficulties in theworkplaceratherthanhiringand traininganewemployee.
ome coaching maybe required in order to help the employee in identifying the
problemand togive them tools tochange theirbehaviour. Whendealingwithdifficult
-
8/6/2019 Fringe Benefits Report
10/13
~ 10 ~
employees, managers should remember that everyone can occasionally have abad
day. It iswhen thebaddaysbecomeapatternandaffect theproductivityofothers that
actionsneed tobe taken.
lthough manypeople may feel defensive whenproblems areaddressed,providingconstructive feedback can help the employee improve hisor her workperformance.
Patienceandfeedbackcanhelp theemployee toget backon trackandbecomemore
productive. This in turn will serve asan example to other supervisors or managers
seekingways indealingwithdifficult employees.
6. EMPLOYEE BENEFITS:
Employeebenefitsare theextrasorperksapersonreceivesfromhisemployer. These
perksare inaddition to thebasicpayanemployeereceives inexchangeforhiswork.
For example, some common employeebenefits includevacationpayandpersonal
leave. ome typesofemployeebenefitsarerequiredby lawwhileothersareoptional.
The list oflegallyrequiredemployeebenefitsvariesfromplace toplace.
In manyplaces, employers are required toprovide certain employeebenefits. For
example,employers insomeplacesarerequired topaycertain taxesforthebenefit of
their employees. ften, employers are requiredby law to carry certain types of
insuranceaswell.
-
8/6/2019 Fringe Benefits Report
11/13
~ 11 ~
An employer may be required to have insurance that provides coverage if an
employee ishurt on the job, for instance. ometimesemployersarealsorequired to
carrydisability insurance toprovideat least some incomeforemployeeswhobecome
disabled,even ifthedisability isnot theresult ofawork-related injury.
ften, employersprovide employeebenefits that arebeyond those requiredby law.
Employers often do thisbecause goodbenefit packages help them attract qualified
employees.
Forexample,apersonmayreceivesimilarjoboffersfrom twodifferent companies. If
thepay isabout thesame, the jobcandidate maychoose thecompany that provides
thebest benefit package. Insomecases,employeebenefitsareseenasso important
that a jobapplicant mayconsidertakinga lower-paying job iftheemployeebenefits
areveryattractive.
For manypeople, health care coverage is among the most desirablebenefits. There
arecountlesspeoplewhodonot havemedical coverageandhave topayout ofpocket
for doctor and dentist visits.A single hospitalization, even for something relatively
minor,has thepotential tocost anuninsuredpersonagreat deal inmedical fees.
Ifan individual hasa family tocare for, thepotential costs maybeevenhigher.As
such, companies that offer generous medical coveragebenefits may have an easier
timeattractingandkeepingemployees.
Another in-demand employeebenefit is vacation time. Many companies offerpaid
vacationdays for employees who have worked for them for a significant period of
time.
These dayscanbeused foranypurpose the employeesees fit. Hemayuse them to
travel around the world or even to simply loaf at home in hispajamas. ome
companiesoffereachemployeeaset numberofdays,whileothers increasevacation
timeasemployeesgainseniority.
-
8/6/2019 Fringe Benefits Report
12/13
~ 12 ~
7. ADVANTAGES OF FRINGE BENEFITS:
7.1ADVANTAGES FOR EMPLOYER
1. Improvesefficiencyandproductivityasemployeesareassuredofsecurityforthemselvesand theirfamilies.
2. Premiums are tax deductibleas corporation expense, which means savingswith qualitycoverage.
3. Helpsattract andretainbetterqualifiedemployees.4. Provides high risk coverage at low costs easing the companys financial
burden.
7.2ADVANTAGES FOR EMPLOYEES
1. Employeeswithpersonal life insuranceenjoyadditionalprotection.2. Confidence incompanysschemesboostsstaffmoraleandpride incompany.3. Employees enjoy cheaper rates negotiated through their employer than they
couldobtainasan individual.
4. Peace of mind leading tobetterproductivity as employees are assured ofprovisionforthemselvesandfamilies inanymishap.
8. DISADVANTAGES OF FRINGE BENEFITS:
While giving fringebenefits will have significant advantages to employers and
workers, thesearesomeofthedrawbacksaccording toanemployment attorney:
1. Forsmall employers,fringebenefitswill cost more.Also, theyhave lesschoicein drafting their workers retirement or healthplanbecause of administrative
costs.
2. Thecost ofhealth insurancecoverage issteadilyrising in the U ,making it lessaffordable tomost employersespecially in tougheconomic times.
-
8/6/2019 Fringe Benefits Report
13/13
~ 13 ~
3. The morebenefitsa company will provide, the higher the administrative feeswill cost.
4. Employersmayface lawsuit (usuallyon thebasisofdiscrimination) iftheyfailtoprovidefringebenefits toall workersorexcludesomeonefromreceiving this.
9. LIVE EXAMPLE OF COMPANY:
FRINGE BENEFITS IN WIPRO :1. Cashcompensation.2. Social securityandwell-being.3. Development andeducation.4. Employeestockpurchaseprogram.5. 5% discount ofWIPR stocks (up to10% ofsalarypayments). Leaveofabsenceprograms (sabbaticalsetc.). Relocationprogram.. Railwayhalf-fareseason ticket.
9. FamilyService:Support in theareasofChildcare10.Homecareand Eldercare.11.Bonusforrecommendingnewemployees.12.Special conditionsforinsurance.13.Sicknessandaccident incomeplan.