Mert & Holly Kilpatrick on tue 4 mar 03
----- Original Message -----
> In the US, there are such laws. They require employers
> to provide specific benefits (such as health insurance)
> to all full-time employees. These benefits can add
> substantially to the cost of having employees. It costs
> an employer much, much more to hire one 40-hour-per-week
> person than to hire two people for 20, or even 30, hours
> per week. The government intended for these mandatory
> benefits to better the lot of all working people.
I am not aware of a federal law mandating that employers provide any
particular benefit. A large company would not be able to hire employees if
they didn't provide competitive wages and benefits, and there are volumes of
laws governing the plan designs of plans which ARE offered, both so-called
welfare plans and qualified plans. And any health insurance that is
provided is highly regulated by state insurance regulations, and some
federal mandates (such as the 1970's requirements that companies providing
indemnity health plans also provide at least one HMO.) Correct me if I'm
wrong, but I don't know what law you would be referring to that requires
employers to pay for health insurance, or any other benefit (except of
course social security and medicare). In fact, some smaller companies
negotiate group insurance rates but the employees pay the full premium.
There are some local laws - some states such as NJ and CA require short term
disability, all require unemployment, and some cities like San Francisco
have particular regulations governing benefits.
The standard estimate for cost of fringe benefits has been about 35% of
salary for many years. Of course that varies by region, size of business,
I agree with Snail on the general principle, that mandated costs drive up
the cost of business and result in higher prices and lower salaries.
Companies, such as banks and large retail establishments, that operate with
lots of part-timers, make a calculated decision that they can still attract
enough capable employees to fill a certain percentage of positions without
benefits. Many companies do, however, offer some level of benefits to
part-timers, usually pro-rated in some way.
It is interesting to remember that health benefits, far from originating due
to government mandate, originated during the WWII days of wage controls.
Employers were not allowed to increase salary to attract employees, so they
provided compensation in other forms, health insurance being a key one, to
circumvent federal wage controls, and due to its tax-exempt status it has
become too expensive to alter the approach. But that's another discussion!
(No longer in HR, so I may be forgetting some of that stuff!)
Kathi LeSueur on tue 4 mar 03
>I am not aware of a federal law mandating that employers provide any particular benefit. A large company would not be able to hire employees if they didn't provide competitive wages and benefits, and there are volumes of laws governing the plan designs of plans which ARE offered, both so-called
>welfare plans and qualified plans.>>
What the law provides is that IF an employer offers health insurance it
must offer that benefit to ALL employees not just those of a certain
group. In otherwords, you can't give health insurance to managent and
omit it for the workers on the line. Some companies get around this by
paying management extra money to pay their own insurance. Everytime the
premium goes up, that group of employees gets a raise.