Federally Mandated Employee Benefits

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Offering employee benefits is one way a company must competes in today’s marketplace to retain old employees and attracts new ones. These benefit packages may range from offering basic health insurance to additional discretionary and perk benefits such as vacation and retirement packages. Benefit packages are often a large portion of employee costs and Federal mandates require an employer to carry and offer certain benefits even if they offer nothing else. Federally required employee benefits make up approximately a quarter of the costs associated with employer offered benefit packages. Some of these mandated benefits include Social Security, Worker’s Compensation Insurance, and the Family Medical Leave Act. Social Security along with Medicare, are benefit taxes that are equally paid by the employer and the employee in the form of a payroll tax. This tax constitutes the largest portion of the federally mandated benefits with its purpose being to “help provide financial support to workers and their families when workers retire, die, or become disabled. Medicare provides healthcare assistance to older workers and to people with long-term disabilities … often referred to as FICA (Federal Insurance Contributions Act) or OASDI (old age, survivors, and disability insurance) for Social Security deductions and as MHI (Medicare hospital insurance)” (BLS.org, 2005). In other words, Social Security and Medicare provides for the needs of both individuals and their families. This program protects aging individuals and the disabled from expenses that they cannot afford and that may drain their savings. Social Security is an insurance system administered by the federal government and as stated before, it is mandatory for both employees and emp... ... middle of paper ... ...mployees for longer periods of time. These benefits give certain assurances for both the employee as well as the employer, therefore should remain the obligation of both the individual and the business providing them. Employer benefits must be competitive to attract and keep quality employees but the federal government recognizes that “perk” benefits will not prepare and sustain employees for everything. Federally required employee benefits supported by both the employer as well as the employee such as Social Security, Worker’s Compensation Insurance, and the Family Medical Leave Act are important benefits to our society by providing certain assurances for a stable tomorrow. Works Cited http://www.bls.gov/opub/ooq/2005/summer/art02.pdf http://www.primepay.com/insurance-benefits/mandated-employee-benefits.aspx http://www.dol.gov/dol/topic/benefits-leave/fmla.htm
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