Employee Benefits

Employee Benefits

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For most of history, employees did not receive any type of “employee benefits.”  They simply received their direct wages for time actually worked.  Beginning in the 1940’s, this changed.


During World War II and the years immediately following – due in large part to price and wage controls, employers in the United States began looking for ways to compensate employees in ways that did not involve direct wages.  This was done to cope with the constraints of wage controls, but also to find ways to compete for valuable employee talent, raise employee satisfaction, increase employer loyalty and retain those same employees for longer periods.  These methods enabled employers to reduce training and other turnover costs, increase productivity and become more profitable.

The growth and complexity of employee benefits and employee benefit planning has only increased over the years.  Initially, in the 1940’s and 1950’s, employee benefits were virtually unregulated.  However, over the years, federal and even state regulation has exploded with far more oversight and regulation and even state and federal mandated benefits.  This has required that employers must now make more complex decisions about the employee benefits they wish to provide and the procedures and policies they will use to provide them.  This also has necessitated the retention of professional employee benefit consultants.

The strictest definition of employee benefits includes only those benefits for death, accident, illness, retirement and unemployment.  There is disagreement whether the category of employee benefits should include other employer paid insurance programs such as Workers’ Compensation Insurance, insurance or Social Security contributions by the employer.  Regardless, these programs do exist, are required in most cases and do benefit the employee as well as the employer.

However, the broadest definition of employee benefits would include all benefits and services that advantage and profit the employee directly or indirectly.  These would include:

Legally required programs such as:

  • Workers’ Compensation insurance
  •  Social Security
  • Unemployment Insurance


Premiums Paid for private insurance programs and retirement plans:

  • Group health and medical coverage;
  • Group life insurance;
  • Group dental coverage;
  • Group vision;
  • Group disability;
  • Group long term care;
  • Pension plans;
  • Legal expense coverage; and
  • Property and liability coverages.

 

Payments for time not worked:

  • Vacations
  • Holidays
  • Sick leave
  • Maternity Leave
  • Jury Duty
  • Sabbaticals



Additional Cash Payments to Employees:
 

  • Profit Sharing
  • Savings Plans
  • Suggestion Bonuses
  • Christmas Bonuses
  • Moving Expenses
  • Deferred Compensation
  • Educational Expenses and/or reimbursements


Services Provided to Employees:

  • Subsidized cafeterias or meals
  • Wellness programs
  • Clothing allowances
  • Employee discounts
  • Recreation programs
  • even Van / Car Pooling



Recent studies of small to medium sized employer businesses, show employee benefit costs ranging from 20% to 40 % of payroll – the cost of a $30,000 per year employee could be anywhere from $6,000 to $12,000 per year total.  This, of course would include all benefit costs including Workers’ Compensation, Social Security contributions, etc.

Since 1994, Harman Stone’s clients entrusted our firm for invaluable advice, quality representation in the marketplace, clarity in a challenging business environment, and a partnership seeking new opportunities for profit, growth and prosperity.  We’re a wholly owned business and financial services firm dealing in products, services, and consulting advice in areas of risk, solutions and people.  We assist our clients foresee and engage ever difficult challenges and technologies boldly and courageously.

Let us help you protect your way of life through insurance protection and financial planning.  Call us soon to see about a time when we can sit down for a few minutes and discuss your needs, circumstances, and preferences, as well as possible ways we can be of assistance.  Thank you for your time and consideration.

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