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Chapter 11EMPLOYEE BENEFITS
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Benefits (Indirect Financial Compensation)
All financial rewards that are not paid directly tothe employee
Rewards that employees receive for being members ofthe organization and for their positions in the organization
Improve employee work satisfaction
Meet employee health and security requirements
Attract and motivate employees
Reduce turnover
Maintain a favorable competitive position
To meet legal requirements
Objectives of Benefits Programs
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Types of Employee Benefits
Required By Law(Statutory benefits) Discretionary(Voluntary)
Health care (medical/dental)
EPF (private sector)(retirement benefits)
Payment for time not worked- public holiday
- annual leave- sick leave- maternity leave
Payment for time not worked- Paternity leave- Marriage leave- Compassionate leave- Study leave etc
SOCSO (private sector)(Insurance benefits)
Other optional benefits- Loans (house/car)-Tuition fee reimbursement- Family-friendly benefits
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Under the Act, an employees earning less than RM3,000must compulsorily contribute to SOCSO.
Employees Earning More than RM3,000 and who had not
previously registered or paid contributions to SOCSO are given anoption to be covered under the Act.
Categories of employees exempted from SOCSO's coverage: Government employees
Domestic servants Self -employed Foreign workers Business owner
Rate of contribution: Employer: 1.75% of the employees
Employee: 0.50% monthly salary
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COVERAGE
1) Accidents which occur while in the course of the work.2) Accidents which occur while traveling
On a route between his place of residence and his place of work.On a route between his place of work and the place where he takes his mealduring any authorized recess.On a journey made for any reason which is directly connected to hisemployment.
3) Accident during an emergencyAccident which occurs during an emergency at the employer's premises whilein the course of assisting, rescuing, or protecting other people from disasters(such as a fire breakout).
4) Occupational DiseaseDisease that results from his occupation.
Examples:Loss of hearing due to exposure to continuous excessive noise.Respiratory diseases
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Employee Provident Fund (EPF)
Employees contributionAt least 11% of monthly salary
Employers contributionAt least 12% of monthly salary
EPF Act 1991 it is compulsory for all employees andemployers in the private sector to contribute towardsthe fund and continue to do so until they are 55.
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Pay for Time Not Worked
Public holidays
All employees are entitled to 10 paid Public Holidays (PHs)per year (as declared by Federal Government or/and StateGovernment)
The other 6 days will be chosen by the employers
Compulsory PHs:National Day,Kings Birthday,Birthday of Sultan or Head of State Workers Day (labor day)
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No. of years service No. of days leave per year Less than 2 years 14 2 - 5 years 18 more than 5 years 22
Pay for Time Not WorkedSick leave
Employees are entitled to sick leave if they have astatement (MC) from a doctor certifying them unfit for work.
If an employee is hospitalized, he/she is entitled toleave for up to 60 days per year.
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Years of service No . of days leaveLess than 2 82 5 12More than 5 16
Pay for Time Not WorkedAnnual leave Employees are entitled to take paid annual leave each year.Amount increases with years of service.Minimum paid annual leave as set by the Employment Act:
Maternity leave Every female employee is entitled to at least 60 consecutivedays of paid maternity leave in respect of each confinement.
Up to 5 children
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Discretionary (Voluntary) BenefitsHealth benefits
medical treatment On-site health care dental care Vision care
Payment for time not workedPaternity leaveLeave for educational purposesMarriage leave
Tuition reimbursement programsSpecial treats: e.g. annual dinner, family day Food coupons, subsidized cafeteriasTransportationLow interest loans (car / house)Uniforms and safety clothingStaff purchase discountsSports and recreational facilitiesLegal ServicesFinancial PlanningRelocation benefits
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Work/Life Benefits: Balancing Work and Home Needs
Time off for childrens school activities Employer-paid on-site or near-site child care facilities
Subsidized childcare costs (partial funding)
Health club and wellness programs Subsidized temporary or emergency dependent care costs
Extended leave policies for child/elder care
Educational reimbursement
Sick-child programs (caregiver on call)
Work-at-home arrangements/telecommuting
Flexible work hours scheduling
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Requirements for a Sound BenefitsProgram
Allowing forEmployee
Involvement
Benefits for aDiverse Workforce
Providingfor Flexibility
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Benefits for a diverse workforce
With the increasing diversity of todays workforce, therereally is no such thing as a typical employee
A workforce that is far from being homogeneous basespreference of benefits on factors such as
GenderAge
Marital status
Number of dependents
Years of service
Job title
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Providing for Flexibility
Flexible benefit plans (cafeteria plans) Benefit plan that allows employees to select from a widerange of options how their direct compensation andbenefits will be distributed
Allow employees to select benefits most appropriate totheir individual needs and lifestyles
Provide a menu or choice of benefits for employees toselect from
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Benefits Issues
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Communicating Information about Benefits Package
Workers need to fully understand benefits that are provided them
In-house publications (employee handbooks/newsletters)
Group meeting and training classes
Audiocassettes/videotapes
Bulletin boards
Payroll inserts messages
Specialty brochures
Employee self-service systems (ESS)
Poster, Visual Presentations (e.g. slide shows etc)
Benefits hotline (to answer questions related to EBs)
Intranet
Ways to communicate: