AuthorJeffrey Wilson

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Employee benefits are those incentives, amenities, or perquisites "perqs") that employees receive above and beyond their basic salaries or wages. Certain benefits are required by law (such as overtime pay or excused absences under the Family and Medical Leave Act). Additional benefits or "benefit packages" are generally negotiated as employment terms and conditions between employer and employee. They may be negotiated individually between the parties or through labor-management contract negotiations affecting classes of employees as a whole. Importantly, if employees are represented by bargaining units within a union, they cannot negotiate directly with employer representatives for any change, addition, or deletion of a benefit (this statement does not relate to employee "choice" benefits packages, popularly referred to as "cafeteria plans," discussed below).

An employee benefit may be something as simple as free soft drinks during working hours or as complex as stock options or profit sharing plans. Typicaly, benefits include such advantages as health and life insurance, paid vacation or time off, flexible work hours, holiday pay, and retirement or pension pay.

Federal Laws that Impact Employee Benefits
Laws that Mandate Certain Benefits

There are certain employee benefits, above and beyond wages, that are legally required of all employers. These include social security contributions, federal and state unemployment insurance, and worker's compensation. The unemployment insurance program was established under Title IX of the federal Social Security Act of 1935 (42 USC 1101), which also governs social security contributions. Minimum working conditions and working environments are mandated by the federal Occupational Safety and Health Act (OSHA).

Laws that Impact Employee Benefits

The Employee Retirement Income Security Act (ERISA) regulates employers who offer pension or retirement benefit plans to their employees. One of the most important components of ERISA as it relates to employee benefits is that certain employers and plan administrators must pay premiums to the federal government for insurance to protect employee retirement benefits.

The Comprehensive Omnibus Budget Reconciliation Act (COBRA) has an important

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provision requiring the continuation of health-care benefits for employees whose employment is terminated (voluntarily or involuntarily) for a certain number of months, which may be further extended if employees pay the associated costs.

The National Labor Relations Act (NLRA) guarantees freedom of choice and majority rule for employees in choosing exclusive bargaining representatives to negotiate benefits for covered bargaining unit employees.

The Labor-Management Reporting and Disclosure Act of 1959 (also known as the Landrum-Griffin Act) protects employee contributions to union funds by requiring labor organizations to file annual financial reports.

The Family and Medical Leave Act (FMLA) requires employers with 50 or more employees to allow up to 12 weeks of unpaid, job-protected leave for the birth or adoption of a child or the serious illness of an employee or a spouse, child, or parent.

Veterans' Preference laws permit special employment preference rights for eligible veterans applying for governmental jobs. The preferential factors apply only at the time of initial hiring and/or in the event of a reduction in force.

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