NAME:AFREEN SHAIKH

COURSE:MBA(HRD) 2ND YEAR

EMAIL ID:affushah01@gmail.com

NUMBER:8408037440

ROLL NO:1719
SUBJECT:COMPENSATION
MANAGEMENT
TOPIC: EMPLOYEE BENEFITS
 EMPLOYEE BENEFITS DEFINITION

In general, indirect and non-cash compensation paid to an employee. Some

benefits are mandated by law (such as social security, unemployment compensation,
and workers compensation), others vary from firm to firm or industry to industry
(such as health insurance, life insurance, medical plan, paid vacation, pension,
gratuity).
 FEATURES OF EMPLOYEE BENEFITS
(1) Employee benefits are those payments which are paid to him in addition to the wages
and salary he receives.
(2) These benefits are not given to the worker for any specific performance of the jobs but
they offered boosting his interests in work and make the job more productive for him.
(3) Employee benefits represent labor cost. Whatever benefits are offered to the
employees in kind or in money terms account for cost.
(4) These benefits are offered to employees irrespective of their merit. Merit or non merit
is not the criterion for these benefits.
(5) Benefit given by the employer is meant for all the employees and not a specific group
of employees.
(6) This is a positive cost incurred by an employer to finance employee benefit.
TYPES OF EMPLOYEE BENEFITS
1.Medical Insurance:
• Medical insurance covers the costs of physician and surgeon fees, hospital rooms,
and prescription drugs. Dental and optical care might be offered as part of an
overall benefits package. It may be offered as separate pieces or not covered at all.
Coverage can sometimes include the employee's family (dependents).
• Employers usually pay all or part of the premium for employee medical insurance.
Often employees pay a percentage of the monthly cost. The cost of insurance
through an employer
2.Disability Insurance:
Disability insurance replaces all or part of the income that is
lost when a worker is unable to perform their job because of illness or injury. This
benefit is not commonly offered.
There are two main types of disability insurance:
• Short-term disability insurance begins right away or within a few weeks of an
accident, illness, or some other disability. For example, someone hurt in a car
accident would be offered a few paid weeks to recover.
• Long-term disability insurance provides benefits to an employee when a long-
term or permanent illness, injury, or disability leaves the individual unable to
perform his or her job. For example, an employee with spinal injuries could be
entitled to long-term disability benefits until retirement age.
3.Life Insurance:
• Life insurance protects your family in case you die. Benefits are paid all at once to
the beneficiaries of the policy — usually a spouse or children.
• You can get life insurance through an employer if they sponsor a group plan.
Company-sponsored life insurance plans are standard for almost all full-time
workers in medium and large firms across the country. You can also buy it
privately, but this is usually more expensive.
4.Retirement Benefits
Retirement benefits are funds set aside to provide people
with an income or pension when they end their careers.
Retirement plans fit into two general categories:
• In defined benefit plans (sometimes called pension plans), the benefit amount is
pre-determined based on salary and the years of service. In these plans, the
employer bears the risk of the investment.
• In defined contribution plans: employer or employee contributions are specified,
but the benefit amount is usually tied to investment returns, which are not
guaranteed.
5. Fringe Benefits:
• Fringe benefits are a variety of non-cash payments are used to attract and retain
talented employees. They may include tuition assistance, flexible medical or
child-care spending accounts (pre-tax accounts to pay qualified expenses), other
child-care benefits, and non-production bonuses (bonuses not tied to
performance).
• Tuition reimbursement can be an especially important benefit if you plan to take
classes in your personal time. This can be a great way to advance in your career.
Most firms offering tuition assistance require that courses are related to job duties.
6.House rent allowance:
For most employees, House Rent Allowance (HRA) is a part of their salary
structure. Although it is a part of salary, HRA, unlike basic salary, is not fully
taxable. Subject to certain conditions, a part of HRA is exempted under Section 10
(13A) of the Income-tax Act, 1961.

The amount of HRA exemption is deductible from the total income before arriving
at a taxable income.
7. Salary Increment:
Salary increments are often expressed as a percentage of an employee's overall base
pay. An increment usually represents a portion of what the employee earns per year.
Employers use increments to increase or decrease base salaries or to award bonuses.
Employees use them as a benchmark to either negotiate a pay increase or a starting
salary with a new employer. Public employees typically receive annual raises based
on salary increments.
8.Pensions:
• The minimum eligibility period for receipt of pension is 10 years. A Central
Government servant retiring in accordance with the Pension Rules is entitled to
receive pension on completion of at least 10 years of qualifying service.
• In the case of Family Pension the widow is eligible to receive family pension on
death of her spouse after completion of one year of continuous service or even
before completion of one year if the Government servant had been examined by
the appropriate Medical Authority and declared fit for Government service.
THANK YOU