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Proposal for Employee Satisfaction Survey document sample
Proposal for Employee Satisfaction Survey document sample
Research Proposal 1 Research Proposal Compensation Plans and Employees Acceptance By Kathleen Cline and Gina Rager ILR 619 Indiana University of Pennsylvania May 7 th, 2007 Research Proposal 2 Compensation Plans and Employees Acceptance Table of Contents Abstract………………………………………………………………………3 Introduction/Background……………………………………………………4 Literature Review……………………………………………………………6 Problem Statement…………………………………………………………..10 Significance of Problem…………………………………………………….11 Null Hypothesis……………………………………………………………..12 Study Design………………………………………….………………….12-14 Health Care Coverage……………………………………………..…….14-20 Dental Insurance…………………………………………………………20-21 Vision Insurance …………………………………………………………21-23 Employee Assistance Programs………………………………………..……24 Employee Wellness Programs………………………………………..….23-24 Deferred Compensation Plans……………………………………….…..24-26 Deferred Benefit Plans……………………………………………………….27 Retirement Plans…………………………………………………….…...27-28 Life Insurance………………………………………………………..…...28-30 Short Term Disability………………………………………………….....30-31 Long Term Disability……………………………………………………..31-32 Salary Compensation Plans ……………………………………………..….32 Paid Time Off……………………………………………………………..32-37 Career Development ………………………………………………………...37 Other Benefits…………………………………………………………….37-38 Summary/Findings ……………………………………………………….38-39 Recommendations …………………………………………………….…..39-40 References…………………………………………………………….......41-42 Research Proposal 3 Abstract The purpose of this study is to determine if there is a relationship between certain compensation plans and employee acceptance. The study hopes to determine whether such factors as health insurance plans, dental plans, vision plans, prescription drug plans, retirement plans, employee wellness programs, and life/disability insurance have an effec t on an employee‟s satisfaction of said plans. This study looks at every aspect of compensation benefits to establish which compensation plans satisfy the employees to the fullest. The study also looks at the characteristics such as paid time off (i.e., personal/emergency days, vacation days, bereavement time), career development (i.e., tuition assistance and employee development programs), bonus/incentive plans, company discounted services, and flexible benefits to determine the employees contentment of th e aforementioned plans/programs. Research Proposal 4 Introduction/Background It used to be that if an employer wanted to entice a candidate to take a job all they would have to do is offer them a little more money to their base salary. Then it got to the point where employers, who were looking to lure someone away from a company and get that shining star candidate, would give them a signing bonus. In today‟s work force employees and potential employees do not just look at how much monetary compensation they are getting from an employer, they are concerned with their benefit packages. Employers focus on which incentives should be used in order to get and retain employees (Denisi, & Griffin, 2005, p.382). For many Human Resources professionals, establishing a compensation package that meets the needs of all employees can be a difficult task. In the early years of benefit packages, employers created them voluntarily; there were no laws or regulations in place to make the employers assist their employees in their health care. The employer did this as a positive incentive to retain the employees they already had and attract new candidates. Subsequently, benefit plans were thought to be “either contractual or gratuitous in nature,” in the eyes of the employer the beneficiary had no right to complain or make suggests to change the plans since they were only giving them out of the goodness of their hearts (Krouner, 1976, p. 426-427). Today employers design their benefit plans to give the employees a perceived notion “that management was genuinely concerned for their welfare” (Milkovich and Newman, 2008, p.406). In order to attract high level job candidates, it is important to incorporate a benefit package that entices workers from all spectrums of the workforce. Research Proposal 5 The researchers found this topic especially intriguing due to personal experience, working observations, and educational purposes. It is our thought that everyone involved in the work force will have a strong opinion regarding their compensation package. The researchers thought that this topic is important to them on a personal level, since they will be graduating from a masters program in May. Issues involving benefit plans will very soon be affecting them as well. This project will help the participants in a few months to determine what benefit plans will best suit their personal needs as well as the personal needs of others. They will someday be Human Resources professionals and will need to be able to determine what compensation packages will be best for their organizations and employees. The research that they participated in will give them a cutting edge outlook exceeding their peers due to their knowledge pertaining to the main concerns of employees in relation to their benefit packages now and in the future. Another main reason that the researchers chose this topic in particular was to conduct a study of benefits that will reflect the employees of Indiana County‟s Society of Human Resource Management (herein after SHRM), views on their company‟s bene fits. This not only was an excellent way for the county to get an incite to their employees feelings about their benefits, but this was also an interesting way to engage the graduate chapter. Through the research, the researchers are now able to think ab out the different aspects of the human resource profession. This was a fine time for the researchers to explore a topic that closely relates to their major and future career choices. Being able to use the researchers and not have to pay or take the time out of their busy schedules, SHRM members were made to rely on the skills and educational knowledge that the graduate SHRM members can offer. Research Proposal 6 Literary Review In order to understand what employee benefit satisfaction is, the researchers have found that the definition varies depending on the source. One that they found that will suffice for the researches purposes is that there are two dimensions of employee benefit satisfaction: “1) satisfaction with the cost structure of the benefit program and 2) satisfaction with benefit package quality” (Danehower, 1995, pg. 68). Research proposes that the “basic” benefits that most employers feel are necessary to provide are health insurance, dental, vision, disability, sick leave, vacation time, and maternity/famil y leave. These are the main attributes employees look at when considering taking a job. Even when these small portions of benefits are provided, employee‟s satisfaction is higher then employees that do not get the minimum benefits (Tatum, 2002, p. 27). Any other benefits that are tacked on to those seven categories listed above are often times thought of as perks of working for that organization and do substantially increase employees satisfaction. The researchers found that more and more employers are finding that a big problem with designing their compensation plans is deciding what benefits they want to offer. A way that employers have been able to get around this issue is using flexible benefit plans to let their employees have a more predominant role in the decision of their benefit plans, which over all leads to increased employee satisfaction (Barber et al, 1992, p. 56). Traditionally benefit plan decisions were made by companies benefit administrator /managers, teamed with other members of top management (Barber et al, 1992, p. 55). In the 1960s it became apparent through changing workforce demographics that “traditional benefit plans geared to the needs of the formerly preponderant nuclear family (i.e., an Research Proposal 7 employed male head of household, non working spouse, and children) failed to accommodate the interests of the new workforce” (Barber et al, 1992, p. 55). Most people thirty years ago had indemnity plans. Indemnity plans are a bit like auto insurance: you pay a certain amount of your medical expenses up front in the form of a deductible and afterward the insurance company pays the majority of the bill. (QuickQuote Financial Group, 2005) For years indemnity plans were the norm. Most of our parents were raised under this system. Under this type of coverage one can go to any doctor, any hospital, or chose any health care provider. You didn‟t need a referral to go to a specialist and the insurance company didn‟t tell you whether a visit was necessary or not. On the down side, fee-for-service plans usually involve more out-of-pocket expenses. Often there is a deductible, usually of about $200-$2,500 before the insurance company starts paying. Once you've paid the deductible, the insurer will kick in about 80 percent of any doctor bills. You may have to pay up front and then submit the bill for reimbursement, or your provider may bill your insurer directly (QuickQuote Financial Group, 2005). In the 1980s, health insurance costs and other benefits were on the rise due to inflation. As a way to keep costs contained, flexible plans were becoming appealing. Barber et al says, cost savings can be realized by (a) limiting the total cost of benefits by allowing employees to choose personally valued benefits within a cost constraint and, (b) improving efficiency of benefit use through increased awareness of benefit cost…To some extent, however, the cost containment effect of flexible benefits could be offset by increased administrative costs (associated with processing individual benefit choices) and by adverse Research Proposal 8 selection (where only heavy users of a particular benefit opt for that benefit) , (1992, p. 56). As an employer being able to provide employees with options of a choice in benefits increases the probability that “employees will become more aware of benefits costs, potentially leading to an increased employee appreciation of benefits” (Rabin, 1994, p. 68). The researchers found that in most instances employees underestimate the cost associated with their benefits, because they are not aware of the full capacity of their packages. Rabin states, it has been suggested that employees‟ attitudes toward their benefits are related to their understanding of benefits. Hence, the extent to which an organization‟s benefits communication program increases an employee‟s benefits knowledge and awareness, benefits satisfaction levels may be increased (1994, p. 68). One interesting study that the researchers found was done about how organizations make their decisions to determine their benefit plans. The study said that if employers let their employees have some say over the plans being considered, then their satisfaction with the ultimately chosen plan will be higher then if management chose the plan without any employee input (Davis et al, 1995, pg.256). If there are any perceived thoughts that management was not giving the employees wellbeing consideration, then the plans are more often then not looked upon as being unfair and subsequently disliked. The researchers found that as long as the employees were under the impression that management made the benefit plans in a fair manner, meaning their thoughts and concerns were taken into consideration, then they were more acceptant of them (Davis et al, 1995, p.256). Research Proposal 9 Due to the ever changing and increasing cost of benefits, employees are “feeling less loyal and committed to their employers, experiencing reduced job satisfaction and motivation, and exhibiting counterproductive behaviors” (Davis et al, 1995, p.257). If employees feel that their employer does not care enough about them and their families‟ health, they may develop an immense feeling of betrayal and tend to show it in their work. The United States is the only industrialized nation without universal healthcare. This has in the past, and is already proving to be a huge topic in the upcoming elections. Klein (2006) suggests, “In 2002, we spent $5,267 per capita on healthcare — $1,821 more than Switzerland, the nearest runner-up. And yet we had higher infant mortality, lower life expectancy and more price inflation” (Klein, 2006). Massachusetts has passed the nation's first near-universal healthcare plan, creating a structure that should cover 95%-plus of its citizens by making healthcare as mandatory as car insurance. Most states, including Pennsylvania have some sort of universal healthcare initiation in place, but who knows when or if they will ever get passed. Unfortunately in the richest country of the world, only those under the right plan get to enjoy our medical technology. Further, “because the United States provides little in the way of nationalized benefit plans, pressure on U.S. employers to provide and manage this broad spectrum of benefits is particularly intense” (Barber et al, 1992, pg. 55). Problem Statement Through research and personal communication with human resource professionals, it is concluded that benefit satisfaction can produces a negative effect on the employee. Two major problems that we have found are: 1) due to the overwhelming fact that Research Proposal 10 employees do not either understand or fully acknowledge their benefits, the employees and the employer both lose out and 2) employees are not using their benefits correctly at times, causing the employer to have to spend more money than needed on that employee (Huseman, and Hatfield, 1978, p.4). After speaking to many human resources professionals, the researchers found that there are instances where employees do not take full advantage of all the benefits that are offered to them. This is in most part due to a lack of communication from t he human resources department to the employees. Employees think that the information provided at their orientations about their benefits is all the information that they need. Some employees do not take the time to ask enough thorough questions about the ir benefit plans to get fully acquainted with them. The human resource professionals think that if they give the employees a book with the plans in it, the employees have all the resources they need to figure them out on their own. Because of this communication problem, employees are missing out on benefits that they are entitled to, and therefore are not aware of the extra incentives they have at their organizations, thus creating a negative view of their benefit package (Rabin, 1994, pg. 68). The second problem is very closely tied in with the first. The researchers say, “employee‟s are not using their benefits correctly at times, causing the employer to have to spend more money than is needed on that employee.” What they are referring to is that there are times when an employee will use a doctor outside of their plan, which causes the organization to pay out of their pocket to cover the extra expense. Therefore, the researchers examined the question: is there a relationship between compensation plans and employee acceptance of their compensation plans? Research Proposal 11 Significance of Problems For years it has been a significant problem for human resource professionals to hire people who are willing to work hard for their compensation. Any time a person is hired a company is putting forth thousands of dollars in recruiting, hiring, and training costs, on a gamble whether or not the new employee will be satisfied with the organization let alone their compensation package. A study done by Richard C. Huseman and John D. Hatfield at the University of Georgia says that because employees “are unaware of the benefit package, it is understandable that attaining benefit program goals is severely impeded.” This is a big issue for human resources, if they can not obtain the information they need to assess the goals of their benefits, then the employees will never be satisfied with them (Huseman & Hatfield, 1978, p.4). In regard to our second problem, it is essential for the organization to fully communicate their benefit packages so they do not have to spend money arbitrarily on employees because they are confused as to what doctor they are allowed to see. An issue that may cause an employee frustration with their coverage is if for example an employee has seen a specific doctor for numerous years, but based on the company compensation package, the employee now has to switch doctors. Null Hypothesis There is not a direct relationship between compensation plans and employee acceptance of said compensation plans. Research Proposal 12 Study Design The researchers created a survey based on a past survey done by SHRM. The survey contains 63 core questions that are broken down into 6 parts. Each part deals with a specific type of benefit (i.e. medical insurance, retirement plans, life/disability insurance, paid time off, and other benefits). Every part was broken down into sub -categories so we could gather more detailed responses. A sample question would be: 1. What insurance company and plan(s) do you use for your health care coverage? a) As an employer, we are _____ with health care coverage for our FT employees. __1) Dissatisfied __2) Slightly Dissatisfied __3) Slightly Satisfied __4) Satisfied __5) Very Satisfied b) FT employees are _____with the health care coverage. __1) Dissatisfied __2) Slightly Dissatisfied __3) Slightly Satisfied __4) Satisfied __5) Very Satisfied c) FT employees are interested in making changes to their health care coverage. __1) Strongly Disagree __2) Disagree __3) Slightly Agree __4) Agree __5) Strongly Agree The survey was sent out to all active members of Indiana County SHRM, via email. These questions provided the researchers with the information needed to see how managers feel about their compensation plans, and their perceived knowledge of how th eir employees feel about the plans as well. This survey will benefit all of those employed. In Research Proposal 13 particular, the investigation will help those individuals who develop compensation plans for their employers understand their employee‟s needs. This study will show what plans are most appealing to employees and areas that are not as attractive. The researchers feel that the importance of the study is shown through the increasing concerns of employees and employers in respect to compensations packages. Research Proposal 14 Health Care Coverage Our survey was conducted by 13 companies. In our survey, we had 4 categories of types of industries, which were industrial, service, banking/finance, and other. Four companies were industrial, one company was service, one was banking/finance and seven were considered „other.‟ The number of employees varied between each company. Six companies had fewer than 150 employees, 4 companies had 151-245 employees and 2 companies had 246-390 employees and 1 company had 1,239 employees. Of the companies, we asked how many full time employees they each employed. Four companies had 13-60 fulltime employees, four companies had 61-120 fulltime employees, three companies had 121-153 fulltime employees and two companies had 320-708 fulltime employees. We also surveyed the number of part-time employees. Three companies had no part-time employees, four companies had 1-5 part-time employees, four companies had 14-100 part-time employees, and two companies had 157-376 part-time employees. The gender breakdown by % is as follows: 90M/10F: one company, 80M/20F: one company, 70M/30F: three companies, 60M/40F: two companies, 30M/70F: one company, 0M/100F and two companies did not answer the question. Health Care Satisfaction The companies had to list their medical insurance providers and they were as follows: four companies had Highmark Blue PPO, one company listed Highmark Direct Blue, two companies use Select Blue, one company uses Mountain State BCBS Health America, one company has Highmark PPO Blue Split 90/70, one company uses Highmark POS and three companies use Highmark BCBS. We asked if employer was satisfied with their health care coverage for full-time employees and found that there were two companies Research Proposal 15 with 85% or higher satisfaction, seven companies with 84%-76% satisfaction, and there were four companies with 75% or less satisfaction. We also questioned if they thought their full-time employees were satisfied with their health care coverage. One employer thought their full-time employees were dissatisfied, one employer thought they were slightly satisfied, eight employers thought they were satisfied, two employers thought they were very satisfied and one company did not respond to the question. Our next question asked if the employer thought that their full-time employees were interested in changes to their health care. Nine companies disagreed and four companies agreed. Premiums Our survey asked what % of premium was paid by the company for full -time employees‟ medical insurance. Out of thirteen companies only one company paid 100%. This shocked the researchers, since health care is very expensive and not many companies can afford to pay 100%. The researchers were not surprised to find that one company paid 60%, one company paid 70%, two companies paid 75%, six companies paid 80%, one company paid 84%, and one company paid 85%. The researchers then asked what percent of premium was paid by the company for families‟ medical coverage, one company paid 100%, one company paid 86%, six companies paid 80%, two companies paid 75%, one company paid 70%, one company paid 50% and one company paid 40%. Next, the employers were questioned if they were satisfied with the premium paid by the company. The results were that nine employers are satisfied, one was very satisfied, which seemed like typical responses, but there were also three companies that were either only slightly satisfied or not satisfied at all. Following this question, we asked if the employer thought that their full-time employees were satisfied with the premium paid by the company. Research Proposal 16 Again the researchers found that the data as expected; eight of the thirteen employers thought that their full-time employees were either satisfied or very satisfied with the premiums paid, and three of the thirteen thought that their employees were not happy with what the company is paying. Health Care Eligibility Another question asked when employees are eligible for health care. The researchers found that one company‟s procedure required 30 days after full-time status, if employee is going from part-time to full-time and 90 days after full-time if newly hired. Another company was after three months (90 days). Four companies were after 90 days of employment. A different company was first day of month following employment date. Two other companies started the first of month after 60 days from the date of hire. Another company was the first of the month after 30 days of continuous employment and two companies were immediately upon full-time employment. Additionally, other companies started the first of the month following 30 days of employment (for non -exempt employees) and the first of the month following the date of hiring (exempt employees). Health Care for Part-Time Employees The survey asked if employers provided health care for part-time employees. Two companies answered yes, eight answered no and three did not respond. If they responded yes to this question, they were to outline the percent of premium paid. Nine of the thirteen companies did not answer, the one company that did said that they pay 50% of premium of employee that is covered and employee pays 100% of dependent covered. One company gives their part-time employees full-time coverage; the company pays 80% individual and Research Proposal 17 80% family. The next question asked if the employer was satisfied with health care for their part-time employees. Since not all companies have part-time employees there were only two that said they were satisfied with part-time coverage. The employers were then asked if they thought their part-time employees were satisfied with their health care. One company stated that they were slightly dissatisfied and one was very satisfied. Eleven did not respond to the question. The survey then asked if the employer thought their part-time employees were interested in making changes to their health care. Once again since there were only two companies that offer part-time employee benefits, the only responses were that both companies thought their part time employees did not want to make any changes to their coverage. Cash Compensation Offered The next set of questions asked the employers if they offered cash compensation to full-time or part-time employees who waive the company‟s medical coverage. Seven companies answered yes and six companies answered no. If they answered yes, they were asked the annual compensation. The researchers discovered that every company does this differently. Here are just a few of the different ways that companies offer cash compensation: one company was $24.04/week and $1250/year. Another company had $50/month opt out, and an other had a dollar per hour opt out bonus, and if an employee chooses to opt out of their medical and vision plan, proof of other insurance must be provided in order to receive bonus. A different company gives their full-time employees $1800 for health and $174.96 for dental. Another company gives all employees $65/month per individual and full-time employees receive $150 for family. Research Proposal 18 The employers were then asked if they were satisfied with the cash compensation offered to employees who waived company‟s medical coverage. Only six companies were satisfied, one was very satisfied and six did not respond. The employers were asked if they thought the employees were satisfied with the cash compensation offered to them if the medical coverage was waived. There was only one very satisfied response, five were satisfied, and 6 did not respond. The next question was if the employer thought that the employees were interested in changing to the cash compensation offered to them if the medical coverage was waived. Five disagreed, one slightly agreed, one agreed and six did not respond. Prescription Drug Plans The companies were asked if they offered a prescription drug plan as part of their health care. All 13 companies responded yes. The survey then asked them if they were satisfied with the prescription drug plan in use. Ten employers were satisfied and three were very satisfied. The employers were then asked to evaluate what their employee‟s satisfaction level was with the prescription drug plan. The researchers found that one was slightly dissatisfied, two were slightly satisfied, five were satisfied and five were very satisfied. The following question asked if the employer thought their employees were interested in making changes to the prescription drug plan. Two strongly disagreed, six disagreed, four slightly agreed and one agreed. The companies were asked to name their prescription provider. The providers being used in Indiana are: GoldPermier Pharmacy Network, Highmark, Highmark Direct Blue, Medco, Highmark Select Blue, and Highmark BCBS Premier Gold III. The researchers Research Proposal 19 wanted to know if all of the companies had co-pays on these plans, and they all answered yes. The employer was then to outline their co-pay schedule. The outlines are as follows: -$10 co-pay on all prescriptions -$10 generic, $20 name brand, $40 non-formulary co-pay - $10 generic, $20 name brand co-pay. -$15 co-pay on all prescriptions -$15 generic and $30 brand co-pay. -$5 co-pay on all prescriptions -$15 generic, $30 brand name for 30 day supply, $30 for generic mail order, -and $60 brand name for a 90 day supply. -$8 generic, $15 brand; non-host $5 generic, $20 brand formula and $35 brand non formula. -$10 generic, $20 brand and a mail order of $20 generic and $40 90/day supply. -$10 generic, $20 name brand and maintenance of $20 generic and $40 brand name -$10 generic, $15 30/day supply of brand name and mail order of $30 generic 90/day supply and $40 brand 90/day supply. -$15 generic, $25 brand, $40 nonformula and mail order $30 generic 90/day supply, $50 brand and $80 non-formulary. Dental Insurance Full-Time Employees All of the companies offer dental insurance to their full-time employees. A large portion of the companies (nine to be exact) use United Concordia. One other company uses Research Proposal 20 Gardian, one uses Delta and another company uses Metlife. The researchers asked what percent of the premium is paid by the company for their employees. Five companies paid 85% and above, five companies paid 76%-84% and three companies paid less than 75%. The survey questioned what percent of the premium is paid by the company for employees‟ families. Of the companies, four pay 0%-33%, seven companies pay 70%-80% and two companies pay 86%-100%. After questioning these details, the survey inquired if the employers were satisfied with the percent of premium that was paid by the company. The trend was that employers were happy with their premiums. Seven employers were satisfied and six employers were very satisfied. The researchers questioned if employees were satisfied with the percent of premium that was paid by the company. Although the employers were satisfied with the premiums, the employees opinions were more spread out. Two of the companies‟ employees were slightly dissatisfied, one was slightly satisfied, eight were satisfied and two were very satisfied. The majority of the employees were satisfied with three companies being the exception. The survey questioned when the employees were eligible for dental insurance. Four companies offered dental insurance immediately upon full-time employment, two companies offered the insurance after 30 days, two companies offered dental coverage after 60 days and three companies offered the coverage after 90 days. One of the companies did not respond to the question and one company offered coverage after six months of employment. The employers were asked if they were satisfied with the eligibility for their dental insurance and the responses ranged from slightly satisfied to very satisfied. The employees were also asked how satisfied they were with the eligibility of their dental Research Proposal 21 insurance and the again the answers ranged from slightly satisfied to very satisfied with one company being slightly dissatisfied. The researchers questioned if the company offered dental insurance to their part - time employees. Twelve companies answered no and only one company responded with yes. The company that offers dental insurance to their part-time employees pay a 100% for the individual and 80% for the family. When questioned if the part-time employees were interested in making changes to their eligibility for their dental insurance, two companies disagreed and 11 companies did not answer. The researchers found this to be an interesting finding being that only one company offered dental insurance to their employees, yet employees did not with to make changes to this eligibility. Vision The next category questioned in the survey was vision insurance. The researchers questioned if the company offered vision insurance to their full-time employees. Ten of the companies answered yes and three of the companies responded no. The employers ranged from being satisfied to very satisfied with their vision insurance. Survey results showed that the full-time employees ranged from being slightly satisfied to very satisfied with their vision insurance. Only two companies slightly agreed to makin g changes to their vision insurance. The companies were questioned as to who they used for their vision insurance. Of the 13 companies, ten responded. Two companies used Fashion thru Highmark, four companies used Davis Vision, one company used Highmark, one company used Vision Research Proposal 22 Benefits of America and another company used Optichoice. The employer ranged from being satisfied to very satisfied with their companies vision insurance. The employees agreed with the employers in that they were satisfied and very satisfied with their companies‟ vision insurance. The company then outlined the percent premium that was paid by their company to their full-time employees. Four companies paid 0%, three companies paid 70%-80%, three companies paid 84%-90% and three companies paid 100%. It was question as to what percent of the premium was paid by the company for the employees‟ families. Four companies paid 0%, six companies paid 70%-80% and three companies paid 86%-100%. Both the employers and the employees were slightly satisfied to very satisfied with the percent of premium paid by the company. The survey questioned when the employees were eligible for vision insurance. Two companies offered dental insurance immediately upon full-time employment, two companies offered the insurance after 30 days, one company offered dental coverage after 60 days and three companies offered the coverage after 90 days. Three of the companies did not respond to the question, one company offered coverage after six months of employment and one company offered insurance the first day of the month following their employment date. Both the employer and the employees were slightly satisfied to very satisfied with the eligibility of their vision insurance. Only one company of the 13 offered vision insurance to their part-time employees. The researchers asked the companies to please outline the percent of premium paid and two companies responded. One company paid 100% for the individual and 80% for the Research Proposal 23 families and the other company pay has employees pay their own cost but they do participate because it is a low cost to them. Employee Assistance Programs The researchers asked if the company offered any type of Employee Assistance Programs (hereinafter EAP) to their employees. Three companies did over EAP‟s and nine companies did not (one company did not respond). The three employees then provided a brief overview of the EAP‟s. One employer offered their EAP through their long term disability program, another company‟s EAP was free and confidential for employees and families using a 800# to explain the area of need, and the other company offered an EAP through Gateway for up to six free consultations a year per family member. Of the three companies that have EAP‟s the employers and employees were all slightly satisfied to very satisfied and strongly disagreed to making changes to the EAP‟s. Employee Wellness Plans The researchers asked the companies to please provide an overview of any benefits that are provided by the company for Employee Wellness Plans (hereinafter EWP) and five companies responded. Two of the companies provided health club discounts, one company provided: health club discounts, weight management, smoking cessation, “be -well” incentives (money off insurance), and FSA or other ongoing health education. Another company afforded smoking cessation, weight management and in-house program incentives. The last company listed smoking cessation, weight management through Highmark, onsite fitness center and a “Get Physical” camp. Of the five companies that Research Proposal 24 provided detailed information on their EAP‟s, together the employer and employee were slightly satisfied to very satisfied. Defined Compensation Plan The survey asked the companies if they offered a Defined Compensation Plan (hereinafter DCP) and all of the 13 companies did offer DCP. It was questioned as to what their plan was and seven companies used a traditional 401k plan, one company used a DCRP/403b plan, another company used a 403b plan and the last company offered a 401k plan to non-union employees and a pension to the union employees. The employer was slightly satisfied to very satisfied with there DCP plan offered. Employees were all slightly satisfied to very satisfied with their DCP plan with one exception being slightly dissatisfied. Of the 13 companies, two of them agreed with the fact that they were interested in making changes to their DCP. The survey asked what the maximum percentage was that their employees could contribute to their DCP. Four of the companies failed to respond to the question, one company offered 0%, four companies offered 10%-15%, and one company stated that their 401k employees could contribute 0-100% of their income up to $13,000/year. Two companies stated that employees could contribute any amount allowable by law/IRS limitations and the last company stated that employees do not contribute to the DCP. It was questioned as to what (if any) employer match is contributed to the DCP. The outlines are as follows: - .25 on every $1 up to 6% of salary - 100% first 2.5%; 50% next 2% Research Proposal 25 - 15% - 25% a month for first 10% - 25% limited to 5% of the employee‟s gross annual pay - 25% of employee contribution not to exceed 4% - After two years of service: 2-5 years 1%, 5-15 years 2%, 15-25 years 3%, 25+ years 4% - Company contributes .25/$1 deterred up to 4% of gross - First year 20%, second year 20%, third year 25% - No match to 403(b) It was asked whether the employees are eligible to participate. Seven companies stated after one year, one company stated after 30 days, another company answered TSA upon employment and match after two years of service. Another company responded with immediately, another said the first day of following quarter following 90 days of consecutive service and the last company answered with 401k after 90 days of consecutive employment and pension the first of the month. To receive more detailed information, the researchers asked the vesting schedule of each company. The results are as follows: - 1 year-0%; 2 years-20%, 3 years-40%, 4 years-60%, 5 years-80%, 6 years- 100% - 100% vesting upon entry - Three years of employment in order to be vested - Three years for DCRP immediately for 403(b) - 401k Research Proposal 26 - Five years of employment - Five years of meeting the 100 hours - Annually - Less than 1 year-0%, 1 year-10%, 2 years-20%, 3 years-40%, 4 years- 60%, 5 years-80%, 6+ years- 100% - No vesting for defined contribution - No vesting since the company does not make contributions - Progressive %- seven years to 100% To further get a better detailed understanding of each company‟s DCP, the survey questioned who administers the company‟s DCP. The results varied. One company uses Hartford, two companies listed Principal, one company stated Controller/HR, another mentioned Conrad Segel, one listed S&T Bank, one listed MetLife, another company stated LPL Financial, another used Ameritas, another used PNC Bank, another listed Merrill Lynch, another company used John Hancock, and the last company stated CFO. Defined Benefit Plan The companies were then asked if the offered a Deferred Benefit Plan (hereinafter DBP). Of the thirteen companies only three stated yes with ten stating no. Of the three that offer DBP, one company was satisfied with their DBP, one was slightly satisfied and one was dissatisfied. When asked if the employees were satisfied with their DBP, one company listed the employees as being very satisfied, one stated slightly dissatisfied and the last listed their employees as being dissatisfied. Research Proposal 27 Retirement Benefits The survey requested information regarding the company‟s retirement benefits. The researchers asked what formula was used to calculate retirement benefits. Eleven of the 13 companies did not respond to this particular section. One company stated that actuaries were based on five highest years of pay and years of service and the other company stated that theirs was based on an actuary‟s calculation. Two of the companies stated that they were slightly satisfied with the way their company calculated their retirement benefit and one company was satisfied. One company went on to state that their employees were dissatisfied with the way their company calculated their retirement benefits. Another company‟s employees were slightly dissatisfied while the last company‟s employees were satisfied. The survey then questioned if the employees were interested in changing the way their company calculated their retirement benefits. One company disagreed, one company agreed and another company strongly agreed. The researchers questioned what age and years of service can the company‟s employees receive full retirement benefits. Eight companies did not respond to this section. One company listed a 401k plan and 62 years of age, another listed 55 years of age and three companies listed 65 or older. The next question asked what the vesting schedule was. Of the four companies that responded to this section, one explained that their participants are always fully vested and three companies listed five years of service. As asked in the DCP section, the survey asks who administers each companies DBP. Only four companies responded, each having a different administer. One listed S&T Research Proposal 28 Wealth Management, one listed Unum, another listed PNC Bank and the last of the four listed CFO. In closing of this section, it was asked if the company provided any other types of retirement plans. Two companies listed profit sharing and one listed tax deferred annu ity that employees contribute to but the employer does not. Life Insurance The next section of the survey deals with life insurance. All thirteen of the company‟s surveyed said that they do offer life insurance and they all use a third party provider. The providers used in Indiana County are Fortis, Jefferson Pilot, Fort Dearborn, Eastern Life and Health, ING, MetLife, Genworth, Purdential, Hartford, Boston Mutual and three companies use Unum. All of the employers were satisfied to very satisfied wit h their third party provider except one. Interesting enough even though one employer was not completely satisfied with their provider, all of the employers said that they thought that their employees were satisfied. When asked if they thought their employees wanted to change their third party provider all of them said that they disagreed, with the exception of one that said they slightly agree. The employers were asked to outline any company paid life insurance benefit. Here are the findings: -$20,000 term, add $20,000 if accidental -$25,000 group term life accidental death and dismemberment-automatically reduces to 65% at age 65 and 5-% at age 70, and terminates at retirement -1 ½ annual salary maximum is $100,000 for employees and $200,000 for man agers Research Proposal 29 -1 time the annual salary to the maximum of $50,000 -1 time the annual salary -2 ½ times the hourly rate multiplied by 2080 rounded up-$25,000 minimum -Twice the annual salary -Twice the annual salary with a maximum of $100,000 -Hourly/salaried employees $15,000; managers get $40,000-$75,000 depending on years of service; 100% company paid Life $20,000 and accidental death and dismemberment $20,000 Non exempt employees get 1 time their salary; exempt employees get twice their salary; non union employees get twice their annual salary with a maximum of $100,000; and union employees get $35,000 term UFE per collective bargaining agreement -Up to $50,000 As you can see there are many different ways and formulas that are used to calculate how much life insurance a company should pay for. Also, ten of these companies offer life insurance for the employee‟s dependants. Short Term Disability Another subject questioned in the researcher‟s survey was short term disability. There were ten companies that offer short term disability; out of those ten, eight were satisfied with the coverage and two were dissatisfied. The results were the same when asked if the employer thought that the employees were happy with the coverage as well and only two thought that the employees wanted to change their short term disability. The Research Proposal 30 majority of the companies with short term disability coverage use a third party provider, only three are self insured. Many of the companies used the same number of absences to set the standard of when short term disability becomes effective. For six of the companies an employee only needed to be absent from work for seven days, one company had short term disability coverage start after the fifth absence. Another company did not start it until your 30 th day of missed work, and still another waited for a period of 14 days. The maximum number of days that an employee could be on short term disability did vary considerably; the time ranged from 26 days, to 26 weeks. This was not surprising because there are no set standards that employers have to follow and every company depending on how big it is will vary on how long they can afford to let an employee be on disability. Through the survey the researchers were able to see how the short term disability benefits were provided, and the majority of the companies had different ways to compensate the employees. Excluding the five employers who did not answer this question the breakdown of payment is as follows: -$100 per week -$200 per week -60% of their pay per week -70% of their pay per week -Benefit amount is equal to the lesser of 60% of the employees basic weekly earnings or $750 maximum weekly benefit. Research Proposal 31 Long Term Disability The majority of the participants of this survey do offer long term disability, ten to be exact. Of those ten employers, all but one administers the plan though a third party provider, and the employee is very satisfied with this coverage offered. Also of the ten company‟s that offer long term disability only two have their employees pay for it; and three companies pay 100% of the premium. The trend discovered with this information is that most of the employers offer long term disability no sooner then 30 days after the start of employment, and no later then 180 days. The employers that did offer this benefit were asked by the researchers to outline their payment plans. They are as follows: -40% of basic monthly earnings -60% of basic monthly earnings; maximum monthly benefit of $5,000 -60% of salary, no years of service required -66.66% of earnings -The monthly benefit is equal to the lesser of 60% of the employers monthly earnings, or $2,000 maximum monthly benefit; A minimum monthly benefit is lesser of 10% of the employees monthly benefit amount. Salary Contribution Benefits There was only one company that answered yes to offering other types of salary contribution benefits. They are slightly dissatisfied with what they offer, and think that their employees are satisfied. The third party used for this benefit is AFLAC. Research Proposal 32 Paid Time Off Paid Holidays The researchers found that every company did give their employees paid holiday time. The amount of time ranged from 1 day to a maximum of 13 days. For one company that has union and non union employees, the researchers discovered that the different groups got a different amount of time off. For one company their union employees received 8.5 holidays off and their non union only received 7.5. This is most likely due to the fact that unions have a chance to bargain over how many days off they can get and non union employees do not get this opportunity. Sick Time When it came to sick time off the researchers found that not all companies offer this. Only seven employers provide their employees sick time off. Each company differed on how many days off they could get and how those days were calculated. The results are as follows: -12 days per year for full-time employees - 3 days per calendar year accruable to a total of nine calendar days -5 days per year -6 days for full-time employees; 0 for part-time employees -Full-time employees accrue 1 sick day per month; part-time employees receive a half day per month or prorated depending upon hours worked each week -Full-time department managers receive 1 week every 6 months and 2 weeks after a year Research Proposal 33 -Full-time non union employees receive 5 days after 5 years of service; 6 days after 10 years of service; 10 for working 10 years or more with an additional day for every year worked past 10 The employers are mostly satisfied with this except one, who is dissatisfied. Two employers believe that their employees are dissatisfied with the amount of sick days and the other five feel that their employers are satisfied. There are also two employers that think their employees would like to change how many sick days they receive. Personal/Emergency Days When asked about personal/emergency days there were seven employers that said that they offered them to their employees, and only one was not completely satisfied wit h days offered. The majority of employers do believe that their employees are dissatisfied, and only three sense that their employees want to change the amount offered. The responses that were given to the researchers are as follows: -Allow 3 last minute call offs per year -Full-time employees get 2 days per year; Part-time union employees receive 1 day after 4-5 years of service, 2 days after 6 or more years of service -Full-time employees receive 2 days per year and part-time employees receive none - Full-time employees receive 3 days per year and part-time employees receive none -Full-time employees receive 3 days, 4 days after 10 years of service, 5 days after 15 years of service. -No official personal days, however employees use sick days for this purpose Research Proposal 34 Vacation Days The last section of paid time off that the researchers surveyed was vacation days. All but four employers offer vacation days to their employees the findings are as follows: -10 days off for 1 YOS (hereinafter Year of Service); 15 days off for 2-5 YOS; 20 days off after 5-20 YOS; YOS over 20 years get 25 days off -1 YOS = 5days; 3 YOS = 7 days; 5 YOS = 10 days; 10 YOS = 13 days -14 days -Exempt employees receive: 1-5 YOS = 3 weeks, 5-10 YOS = 4 weeks, 20 YOS = 5 weeks; Non-Exempt employees receive: 1-5 YOS = 2 weeks, 5-10 YOS = 3 weeks, 20 YOS = 5 weeks -Full-time employees get 2 weeks for 1-10 YOS, 3 weeks for 11-20 YOS, any YOS over 20 get 4 weeks; Part-time employee‟s vacation is based on last years hours worked -Union employees: 5 days off for 3 months-2 YOS, 10 days off for 3-5 YOS, 15 days off for 6-10 YOS, 20 days for 10-15 YOS, any service over 15 years gets 25 days off; Non Union employees: 5 days off for 3 months-2 YOS, 10 days off for 3-5 YOS, 15 days off for 6-10 YOS, 20 days for 10-15 YOS, any service over 10 years gets 20 days off -Up to 4 YOS get 10 days, after 4 years they receive 15 days -0-1YOS = 10 days, 3 YOS = 15 days, 5 YOS = 17 days, 7 YOS = 15 days, 10 YOS = 21 days, 15 YOS = 25 days, 20 YOS = 27 days, 25 YOS = 29 days All of the employers are happy with the vacation days that are offered. Amazingly there were six employers that were either dissatisfied or slightly dissatisfied. Only four Research Proposal 35 employers were satisfied. Eight employers think that their employees are satisfied with vacation days offered, and it came as no surprise to the researchers that eight employers believe that their employees would like to change the amount of vacation days offered. Part-Time Employee’s Due to the fact that not all companies employ part-time employees it was no surprise to the researchers that only three companies offered paid time off to their part -time employees. The employers are satisfied with the amount of time off they give and they feel that the employees are also satisfied with it. Part-time employees at these companies get one of these choices: 1)one personal day, one vacation day based on the prior year, one bereavement day and one day for jury duty; 2) Personal days after 3 years of service; 3) Vacation is prorated based of hours worked in the previous calendar year. Bereavement Policies All but two companies surveyed did have a bereavement policy. Each policy differed slightly from each other. The policies are as follows: -3 days for full-time employees; paid for immediate family members, unpaid for other relatives -3 days immediate family members and 1 day for extended family members -3 days immediate family members and 1 day for aunts an uncles etc -3 days off with pay for immediate family members Research Proposal 36 -3 days off up to and including the funeral -3 paid days off for full-time employees after introductory period of 13 weeks -4 days for a spouse, children, stepchildren; 3 days for siblings, parents, grandchildren; and 1 day for in laws -5 days -Full-time employees get 4 days including the day of the funeral -Full-time employees get up to 3 days for a parent, spouse, sibling etc.; 1 day grandparents; and part-time employees only get 1 day. -Up to 3 days paid leave All eleven companies with policies are satisfied to very satisfied with their policies. They feel that their employees are also satisfied with them and do not want to change what is already in place. Career Development Through the survey the researchers found that only eight of the companies surveyed have career development programs. All of these companies are very satisfied with the development plans they offer and they feel that their employees are as well, and do not think that they want to make any changes to the programs offered. Some of the different programs being offered are: -Cross training and internal classes -Plan 1-Full-time employees get $1,500; Plan 2-Part-time employees get $750; Plan 3-All employees get $3,000 junior/senior year nursing school; Other- $350 per year for certification -Tuitions reimbursement/assistance Research Proposal 37 -Tuition reimbursement. Enhanced tuition assistance for employee‟s pursuing a career as a registered nurse. Other Benefits Bonus and Incentive Plans Of the thirteen companies surveyed only eleven of them answered this question. Nine companies do offer bonus and incentive plans, all of which are very satisfied with the plans they offered and believe that their employees are too. Only one company thinks that their employees might want to change the plan. Services at a Discount There are only five companies that get their employees services at a discount. Out of those five they all fell very satisfied with these services and feel that their employees do not want to make any changes to them. Flexible Benefits Out of the thirteen companies that participated in this survey the researchers were amazed to find that only company has flexible benefits. This was astonishing to the researchers because flexible benefits seem to be the norm for companies these days (Barber et al, 1992, p. 56). The company that does offer flexible benefits is very happy with their plan and so are their employees. Summary/Findings After viewing all of the information found through the survey, the researchers came to the conclusion that the 13 companies in Indiana County SHRM that participated in this Research Proposal 38 survey proved for the null hypothesis to be false. There is a relationship between compensation plans and employee acceptance of said compensation plans, and what the relationship deals with. The relationship lies between different compensation plans and the amount of money the employers and employees have to pay for those said plans. The survey also shows that employee satisfaction is highly correlated to the amount of m oney that is paid by the company. The researchers based their conclusion from the following information and trends. The higher percent paid for medical coverage, the lower the percent paid for dental coverage. The higher the percent paid for health care coverage, the less satisfied the employees are with their dental coverage. The researchers concluded from this data that the percent of dental insurance is negatively correlated to the percent premium of health care. Significant findings include a negative correlation between vision insurance and health care premium paid by the company. Along with dental insurance, the more health care that was paid by the employer, the less offering for vision insurance. The last significant correlation the researchers found was that employers that offer satisfactory health care coverage also offer DCP‟s. Recommendations The researchers felt that some improvements the employers should investigate include a more even distribution of premiums paid more between (for example) dental and health insurance. The employees would be more satisfied if their premiums were more evenly distributed between the employees and the employer. Employees work hard for Research Proposal 39 their employers, trying to make their company profitable and more efficient. These employees work with dedication and deserve to be compensated for their actions. It is imperative that employers recognize the needs of their employees and provide compensation packages that reward employees. It is also important for the employers to educate their employees on all benefits offered. Some employees may be dissatisfied for the wrong reason because they are not aware of all the details of their benefit package. Even though the researchers lack human resource experience, while inputting the data they notice and the lack of the companies benefits offered. Employers need to remember that they are not only trying to please the employees they have, they are trying to entice potential employees with their benefit packages. It pay profit the company in the long run if they offer, competitive benefits, that will retain good quality employees. Research Proposal 40 References Barber, A., Dunham, R., & Formisano, R. (1992). The impact of flexible benefits on employee satisfaction: A field study. Personnel Psychology, 45(1), 55-75. Retrieved Monday, February 10th, 2007 from the Academic Search Premier database. Blau, G., & Tatum, D. (2002). Further distinguishing basic versus career enrichment benefit satisfaction. Benefits Quarterly, 18(3), 27-34. Retrieved Sunday, February 18, 2007 from the Academic Search Premier database. Danehower, C., & Lust, J. (1995). Understanding and measuring employee benefit satisfaction. Benefits Quarterly, 11(1), 69-75. Retrieved Sunday, February 18, 2007 from the Academic Search Premier database. Research Proposal 41 Davis, E., & Ward, E. (1995). Health benefit satisfaction in the public and private sectors: the role of distributive and... Public Personnel Management, 24(3), 255. Retrieved Monday, February 10th, 2007 from the Academic Search Premier database. Denisi, A.D. & Grifin, R.W. (2005). Human resource management (2nd ed.). Huseman, C., & Hatfield, D. (1978). Communicating employee benefits: directions for future research. Journal of Business Communication,15(4), 3-17. Retrieved Monday, February 10th, 2007 from the Academic Search Premier database. Klein, Ezra. “Going Universal.” December 26, 2006. Retrieved Monday, February 10th, 2007 from http://www.latimes.com/news/opinion/la-oe- klein26dec26,0,5461327.story?coll=la-opinion-rightrail. Krouner, L. (1972). Employee benefit plans: Due process for beneficiaries. Labor Law Journal, 23(7), 425-443. Retrieved Sunday, February 18, 2007 from the Business Source Premier database. Milkovich T. George, and Newman M. Jerry, (2008). Compensation. (9th edition). Personal Communication with Dr. David Piper, February 27, 2007. Personal Communication with Dr. Scott Decker, February 27, 2007. Research Proposal 42 QuickQuote Financial Group. “Types of Health Insurance.” 1997-2005.Retrieved Sunday, February 18th, 2007 from http://www.quickquote.com/hitypes.html. Rabin, B. (1994). Benefits communication: Its impact on employee benefits satisfaction under flexible programs. Benefits Quarterly, 10(4), 67-83. Retrieved Sunday, February 18th, 2007 from the Academic Search Premier database.
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