HRM 635 What are legally required benefits and why are they required by law?

Companies and the government are required to provide certain benefits to their employees and citizens. There are benefits required by the federal government and some required by state governments. The federally required benefits are social security, Medicare, Medicaid, health insurance, unemployment insurance, worker’s compensation, and family and medical leave. They are required by law in order to protect employees and help them prepare for retirement and were made in response to workers’ rights and welfare movements. Benefits that companies are required to provide, such as family and medical leave, can be waived if the company has less than 50 employees. An addition to these required benefits could be that companies should be required, by federal law, to provide maternity leave to both the mother and father of a newborn. Currently this benefit is only provided to the mother through the Family and Medical Leave Act of 1993. However, if the federal government was to extend this to the father, it could help reduce gender discrimination within recruitment and help provide families with the support they need.

Armstrong, Sharon, Mitchell., & Barbara. (2019). The Essential HR Handbook, Tenth Anniversary Edition. https://library-books24x7-com.lopes.idm.oclc.org/assetviewer.aspx?bookid=141667&chunkid=970802763&noteMenuToggle=0&leftMenuState=1

One of the most important and widespread trends in employee satisfaction recently has been an increased interest in the benefits employers provide for their staff. In fact, many recent studies including this one, show that employees today are just as if not more interested in a good benefits program, as they are concerned with the height of their salaries. This has translated into companies offering a great employee benefits plan, having the upper hand when it comes to both hiring and retaining top-tier talent. However, if you are a small business owner that is just getting started and cannot really afford to offer a sophisticated benefits package, it is important to know that there are still benefits that must be provided. There are legally required benefits that are considered mandatory for just about all businesses, ones that every company must offer to their staff according to federal regulations and laws. Mandatory benefits, also known as statutory benefits, are benefits that employer are required by law to provide to their employees. Examples include worker’s compensation insurance, unemployment insurance and, under some state and local laws, paid sick leave. What are the employee benefits legally required by law? These includes:

· Social Security and Medicare Workers

· Unemployment Insurance

· Required for Businesses With 50+ Full-Time Employees

· Health Insurance

· Family and Medical Leave

· Disability Benefits Required in Certain States

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The employee benefits that are required by law, are typically benefits that are considered absolute necessities for ensuring the health and safety of employees. That is why these benefits are standard across all states and industries and are enforced by laws that were created by the U.S. Department of Labor, to ensure that all employers are giving their employees access to them. Of course, there are always exceptions and regulations that vary from state to state, which is why it is important for all employers to be sure that they are following the legal requirements for their specific location. However, generally speaking, the following are employee benefits that are usually mandatory, no matter where your business is located in the U.S. Therefore, these legally required benefits provide workers and their families with retirement income and medical care, that mitigate economic hardship, resulting from loss of work and disability, and it covers liabilities, resulting from workplace injuries and illnesses.

HRM 635 What are legally required benefits and why are they required by law

Non-mandated employee benefits not required by law, are at the discretion of the employer. These can include benefits, such as paid vacation time, contributions to retirement saving plans, education assistance, wellness programs, and childcare assistance. However, federal law still affects discretionary benefits such as vacation leave in many states, and employers must be aware and adhere to these laws (Dessler, G. 2016). In my own opinion, I suggest that part of student’s loan should be waived, or no interest should be charged on them. These particular problems have kept many students depressed, frustrated and they continue to pay the debt till lifetime. While benefits such as paid time off, health insurance, and 401(k) plans are highly sought-after, basic benefits can also be invaluable for employees. So, employers should ensure that your business, its meeting, and its obligations are to provide assistance and compensation by way of Social Security, Medicare, unemployment, and workers’ compensation insurance. As made plain by the information listed above, employees are entitled to a variety of benefits which employers are required to offer by law.

References:

Armstrong, Sharon, Mitchell., & Barbara. (2019). The Essential HR Handbook, Tenth Anniversary Edition. [Books24x7 version]

Dessler, G. (2016). Human Resource Management (15th ed.). Pearson Education

Fisher, J. (September/October, 2007). “Reconciling the Family Medical Leave Act with Overlapping or Conflicting State Leave Laws,” Compensation & Benefits Review, pp. 39–44.

Benefits that are legally mandated offer workers and their families a retirement income and medical treatment, minimize economic hardship caused by job loss and disability, and cover liabilities stemming from occupational accidents and illnesses. Employers may provide vacation, health insurance, long-term disability coverage, tuition reimbursement, and retirement savings programs to their employees. It is critical to handle mandated and state-mandated benefits (U.S. Bureau of Labor Statistics, 2020). Employers should assess their responsibilities under state and municipal legislation, which may impose extra benefits. Employee perks mandated by law are often regarded as the fundamental necessity for guaranteeing employees’ health and safety. As a result, these benefits are uniform across all states and sectors, and they are governed by federal labor laws that require all businesses to provide them to their employees. Of course, there are always exceptions and restrictions that differ by state, so all companies must adhere to the legal requirements for their unique region (SHRM, 2021). It is usually recommended to consult a legal consultant specialized in these subjects if executives want clarity on labor regulations and obligatory employee perks. However, regardless of where a company is situated in the United States, the following employee perks are almost always required. As shown by the information above, employees are entitled to various benefits that employers are compelled by law to provide. Leaders may better understand the employee perks they should provide by reviewing the material given above. Employers are not obligated to provide health insurance under federal law. However, some significant firms may face financial penalties if they fail to comply with the Affordable Care Act. Employers are often not compelled by law to offer health insurance, pensions, paid sick days, severance compensation, or other benefits to their employees.

SHRM. (2021). Mandatory benefits. SHRM. https://www.shrm.org/resourcesandtools/tools-and-samples/hr-glossary/pages/mandatory-benefits.aspx

U.S. Bureau of Labor Statistics. (2020). Perspectives. In Bureau of Labor Statistics U.S. Department of Labor. https://www.bls.gov/opub/btn/archive/program-perspectives-on-legally-required-benefit-costs.pdf

SHRM. (2021). Mandatory benefits. SHRM. https://www.shrm.org/resourcesandtools/tools-and-samples/hr-glossary/pages/mandatory-benefits.aspx

Benefits are both indirect and direct financial compensation awarded to employees from their company. A company needs both aspects of benefits both legally and for employee engagement purposes. Prospective employees are always curious to see what is the most an organization can offer them. In fact, it can be the determination of which organization they choose to commit to regarding the non-obligatory benefits that an organization require.

Legally, there are some benefits that an employers must offer. They are required to cover liabilities to protect both the employee and the employer from injury or harm that could occur. An example of this is workman’s compensation. “Workman’s compensation laws aim to provide sure, prompt income and medical benefits to work related accident victims or their dependents, regardless of fault” (Dessler, 2016, p. 821). These benefits can be provided monetarily, in medical care, or both. The only factor that remains constant in every workman’s compensation case is whether the injury occurred at the workplace, fault never plays a part in the determination of compensation. Workman’s compensation is a required source of support for every employee. However, an employee can refuse treatment or care. Even if an employee is hesitant, it is encouraged by the employer to seek advisement and assessment from the workman’s compensation team.

A benefit that I wish would be mandatory for employers to provide is unpaid leave or FMLA. At our organization, permitted personal leave is granted at the discretion of the executive team. Each campus is different and not many of them do grant this. As a leader, I see the strain it causes a department to grant personal leave, so I understand the rational. However, there are always the “one off” situations that break my heart and want my campus to honor leave for those individuals.

Overall, benefits are an asset to a company that can make or break employee engagement. Although there are benefits required by law, it is the way the organization handles these benefit cases that maintains engagement and respect within the organization for these services.

Reference:

Dessler, G. (2016). Human Resource Management (15th ed.). Pearson Education.

HRM 635 What are legally required benefits and why are they required by law?