Chapter Six Presentation
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![Page 1: Chapter Six Presentation](https://reader033.fdocuments.us/reader033/viewer/2022061218/54826b2ab47959f10c8b47be/html5/thumbnails/1.jpg)
CHAPTER SIX
EMPLOYEE PAY AND BENEFITS
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OBJECTIVES
• Compute payroll deductions and net pay from information and tables provided.
• Identify optional and required employee benefits and recognize their value as additions to net pay.
• Explain trends in the workplace such as flexible schedules, job rotation, job sharing, and permanent part-time employment.
• Understand the role of unions and professional organizations in the workplace.
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Gross Pay, Deductions and Net Pay
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Gross Pay
• The total or agreed-upon rate of pay before any deductions are made.
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Ways of Getting Paid
• Hourly Rate: The number of hours you worked times the hourly rate of pay
• Overtime: Hours worked beyond the regular hours.
• Monthly Salary: You receive pay for 40 hours a week with no pay for overtime.
• Annual Salary: Divided into equal parts over the year
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Deductions
• Amounts subtracted from your Gross Pay.
• Examples: – Required by Law: Social Security, Federal
Income Tax, and State Income Tax.– Not Required by Law: Health Insurance, IRA,
TSA, optional benefits, etc.
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Net Pay• The amount left over after all
deductions are taken out. Net pay is also referred to as take-home pay.
• This is the amount of your check you can actually spend.
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Formulas
• Regular Wages or Salary + Overtime = Gross Pay
• Gross Pay – Deductions = Net Pay
• Look at figure 6-2. Employee Withholding Sheet.
• Look at figure 6-3
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Benefits and Incentives
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Profit Sharing
• A plan that allows employees to receive a portion of the company’s profits at the end of the corporate year.
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Paid Vacations and Holidays
• While you are on vacation you are paid as usual.
• Another benefit you might receive is paid time off for holidays. If an employee is required to work on a holiday they usually receive double time or time and ½.
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Employee Services
• Extras that companies offer in order to improve employee morale and working conditions.
• Example: if you work in a clothing store you might receive a 10% discount.
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Sick Pay
• Allowance of days each year are given for illness.
• It is normal to receive 3-10 days sick leave a year without deduction.
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Leaves of Absence
• Some employers allow employees to leave their jobs(without pay) for certain reasons, such as having children and completing education, and then return to their jobs at a later time.
• The Family and Medical Leave Act took effect August 5, 1993
– Stated that Employers with fifty or more employees must give up to twelve weeks unpaid leave per year for the birth or adoption of a child, care of a loved one, etc
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Insurance
– Most Employers offer insurance benefits to their employees.
– Most plans are paid for.– Insurance plans typically include
health, dental, vision, and life insurance
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Health Insurance
• A typical plan is a $150 deductible. After that the insurance will pay 80% and the user will pay 20%.
• We will discuss this in a later chapter.
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Life Insurance
• Pays a cash benefit to a designated person, called a beneficiary, when the insured dies.
• We will cover this issue in detail in a later chapter.
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Dental Insurance/Vision
• We will discuss in Chapter 27
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Bonuses and Stock Options
• Incentives based on quality of work done, years of service, or company sales or profits.
• Christmas bonuses are popular.
• Stock-purchase options give the employees options to buy stock in the business.
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Pension and Savings Plans
• Employee sponsored savings plans– 401 (K) for private employers– 403 (K) for government employers
• Usually employees can not withdraw from these accounts until retirement
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Travel Expenses
• If you are required to travel you receive money in order to travel.– Car, Insurance, gas expense, meals, lodging,
etc.
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TRENDS IN THE WORKPLACE
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Altered Workweeks
• Flexible Schedules– Starting and finishing when you like as long as
you are there eight hours during core hours.
• It allows people to work when their schedules are best.
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Job Rotation
• Training employees to be efficient in more than one specialized area.
• This can be costly to the companies, however it is better for the individuals because it helps them to improve individually.
• It is also better because then one person doesn’t have total control over one area.
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Job Sharing
• Two people share a full time job.
• Salaries are split according to each persons contributions
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Permanent Part-time and Telecommuting
• Some employees are choosing to work only part-time and some businesses are allowing those people benefits.
• Telecommuting allows employees to work in their own home in such areas as routine data entry, transcription, keyboarding, and software development.
• Information processing and related fields, home work is becoming popular.
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Childcare
• Many companies have started providing on-site child care facilities as well as coverage of child care expenses as part of employee benefits.
• Legislation will focus on high-quality, affordable programs for children and working parents.
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LABOR UNIONS AND PROFESSIONAL
ORGANIZATIONS
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History of Unions
• Unions were organized in the US as early as 1800.
• The first union was a local group of skilled craftspeople that wanted to protect themselves from competition by untrained and unskilled employees.
• 1886: the American Federation of Labor was organized by Samuel Gompers.
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More………..
• The unions had little power till 1935.
• In 1935 the National Labor Relations Act gave unions the right to organize and bargain with employers.
• In 1938, John L. Lewis became the first president of a new union called the CIO(Congress of Industrial Organizations)
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More………..
• Unions continued to grow in number, power, and size until 1947, when Congress passed the Labor Management Relations Act, commonly called the Taft-Hartley Act.
• This act was passed to limit the powers of unions and to curb strikes.
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More…….
• In 1955, the AFL and CIO merged under the leadership of George Meany and became the largest and most powerful union in the U.S.
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Functions of Unions:
• To recruit new members
• To engage in collective bargaining
• To support political candidates who are favorable to the union
• To provide support services for members
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More……..
• Collective Bargaining: the process of negotiating the terms of employment for union members
• Union contracts usually provide for seniority----last one hired should be first to be laid off.
• Mediation: When a union gets the help of a 3rd party.
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Three Types of Unions
• Craft Unions: members are people with a particular craft or trade.
• Industrial Unions: Industry workers. AFL-CIO, Teamsters, and United Auto Workers.
• Public Employee Unions: Municipal, county, state, or federal employees such as firefighters, teachers, and police officers.