Hospitality Human Resources

1
HospitalityHuman Resources

• Chapter 9
• Incentive Benefits Administration

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What Youll Learn

• Characteristics and Advantages of Effective
  Benefits Programs
• Individual vs. Group Incentive Programs
• Categories of Benefits
• Factors to Consider when Developing Benefits
  Programs

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Effective Incentive Programs Should

• Aim toward specific goals that employees
  understand
• Be fair and easy to measure
• Allow for improvement in productivity/performance
• Have attainable goals
• Contain substantial rewards
• Tied to rewards such as advancement
• Rewards linked to output not time invested
• Rewards must be administered quickly

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Individual Incentive Programs

• Six common individual incentive programs
• Piecework rewarding employees who exceed
  established minimums
• Standard Hour (Day) based on the number of
  units completed in an hour/day
• Commissions incentives increase as sales
  increase
• Bonus Plans combination of base pay and
  incentives (can be individual or group based)
• Pay for Knowledge premise that knowledge more
  productivity or higher value
• Merit Pay increase in base pay wages at the end
  of a specific period (linked to performance)

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Group Incentive Programs

• Group incentives should motivate employees to
  perform cooperatively
• Cost Savings Plans (a.k.a. cash reducing plans)
• Reduce the amount of cash required to operate the
  business
• Profit Sharing Plans
• If employees improve profitthey share in the
  profit
• Includes Cash Plans, Deferred Plans,
  Combination
• Stock Ownership
• Employee Stock Ownership Plans (ESOPs)
• Stock Options less favorable due to higher
  taxes typically for upper management

Money or Merchandise?
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Quick Question

• Which of the following is NOT an individual
  incentive program?
• Standard hour program
• Merit Pay
• Cost-savings plan
• Bonus plan

Answer C
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Employee Benefits

• Benefits are often perceived by employeesas
  expected compensationthereforeBenefits are
  rarely seen as a motivator.
• Four Categories of Employee Benefits
• Mandatory Benefits
• Voluntary Benefits
• Pension/Retirement Benefits
• Miscellaneous

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Mandatory Benefits

• Legislated by federal state governments
• Social Security
• Provides financial security to employee and
  dependents
• Unemployment Compensation
• Provides 50 80 of pay not for reasons of
  misconduct
• Workers Compensation
• Provides compensation for employees who become
  disabled or die at work regardless of fault
• Family Leave
• FMLA 12 weeks unpaid for illness of self,
  child, parent, or other dependent also for
  newborn/adopted child

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Voluntary Benefits

• Not mandated by governmentbut have come to be
  expected by employees.
• Group Life Insurance typically offered with
  long-term disability
• Group Health Insurance rapidly increasing
• Consolidated Omnibus Budget Reconciliation Act
  (COBRA) qualifying events allow to continue
  HI
• Alternative Health Programs
• Health Maintenance Organizations
• Preferred Provider Organizations
• Self-insurance

Cafeteria Plans
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Pension Retirement Benefits

• Used to develop a stable, reliable workforce
• Contributory Retirement Plans employee
  employer contribute (typically 50 cents on the
  dollar)
• Non-Contributory Plans employer only
• Types of Plans
• Defined Contribution Plans
• Defined Benefit Plans
• Individual Retirement Accounts (IRA)
• Salary Reduction Plans 401(k)

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Other Benefits

• Educational Benefits tuition assistance
• Employee Assistance (EAP) counseling
• Child Care up to 5k with pretax dollars
• Cafeteria/Flexible Plans
• Core Spending provide core benefits, plus
  others they can choose from
• Module Spending pre-established packages
• Flexible Spending given amount of money to
  spend employee chooses benefits

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Quick Question

• Among forms of compensation, Section 401 (k)
  plans are examples of
• Defined Contribution Plans
• Salary Reduction Plans
• Educational Benefits
• Defined Benefit Plans

Answer B
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What You Know

• Why are benefits no longer viewed as motivators?
• How do individual and group incentives differ?
• What defines an effective incentive program?
• What are the major Mandatory benefit programs?
• What are some common Voluntary benefit programs?
• What are the most common kinds of pension and
  retirement plans offered?
• What services are commonly offered through EAPs?