Employee Benefits Remain Stable as Recession Lingers (9/10)

Employers continue to offer a wide range of benefits even during the recession, according to a recent survey.  Find out how your benefit offerings compare.

The Society for Human Resource Management (SHRM) has released its 2010 Employee Benefits Research Report, and it shows that while most employers are still feeling the pain of the economic recession, they also continue to provide a variety of family-friendly benefits.  For the most part, companies’ benefits dollars are being spent primarily on traditional benefits such as health insurance and paid time off, and trendier benefits such as dry cleaning and concierge services are not being offered by many employers.  Sixty-three percent of the 534 surveyed human resource professionals indicated that the recession has negatively affected their benefits offerings “to some extent” over the past year, and 9% reported the recession had a “large” impact on what they could provide their employees.  Still, the survey also reaffirms that benefits are a key part of your employee compensation packages. Traditional Health Insurance Provided by Most Surveyed Employers As usual, health care remained as the top employer benefit.  Ninety-eight percent of respondents offer some form of health care insurance or employer-funded health reimbursement accounts.  Prescription drug coverage (96%), dental insurance (94%), and preferred provider organizations (PPOs) (85%) top the list.  Medical flexible spending accounts are also popular, offered by 72% of respondents.  In contrast, health maintenance organizations (HMOs), which were offered by over 60% of respondents ten years ago, now are offered by only 33% of participants in the current survey.  Health savings accounts, created by federal law in 2003 to allow individuals to save for future medical expenses on a tax-free basis, are offered by only 11% of respondents. Retirement Savings Plans Also Key Benefits Most employers also provide some sort of retirement benefits to employees.  Ninety-two percent offer some sort of defined contribution retirement plan, including 401(k) or 403(b) plans, and 39% offer automatic enrollment in the plans.  Thirty-nine percent offer retirement planning services, while just 6% offer a formal phased retirement program. Paid Leave Benefits Hold Steady  The vast majority of the respondents (97%) still provide paid holidays, and 83% offer paid sick leave, either through a stand-alone sick leave plan (36%) or as part of a paid-time off plan (47%).  Paid vacations are offered by 91% of responding organizations, either as part of a dedicated vacation plan (44%) or as part of a paid-time off plan (47%).  Paid bereavement leave is offered by 89%, and floating holidays that allow employees to take paid holidays on days of their choice continue to be provided by 43%. Family-Friendly Benefits Continue to Be Popular The survey also confirms that most employers continue to provide at least some “family-friendly” benefits.  The most common of these benefits is dependent-care flexible spending accounts, which are offered by 72% of respondents.   Thirty percent of respondents allow employees to bring children to work if they have a child care emergency, and 17% offer child care referral services.  Domestic partner benefits (excluding health care) for same-sex partners are offered by 15% of the surveyed organizations, while domestic partner benefits for opposite-sex partner are offered by 13% of the surveyed organizations.  (Surveyed employers also covered domestic partners under their health insurance plans, with 38% covering same-sex partners and 37% covering opposite-sex partners.)      Elder care benefits are less popular, even though elder care issues have gotten a lot of press the last few years as middle-aged workers are often referred to as the “sandwich generation” because they have both child care and elder care duties.  Only 11% of respondents offer elder care referral services, and just 2% offer access to backup elder care services.      Flexible work schedules are more popular.  Forty-nine percent of respondents provide flextime, 34% allow employees to work compressed workweeks, and 13% offer job sharing.  In addition, many allow telecommuting, although only 17% let employees work from home full-time, while 34% allow part-time telecommuters.  However, the number of organizations offering flexible alternatives has actually dropped over the last few years.  Flextime was offered by 56% of respondents in 2005, while full-time telecommuting and job sharing was made available by 19%.   Most Relocation, Personal, and Travel Benefits Decline  Relocation benefits appear to be among the hardest hit by the recession.  Location visit assistance was provided by 36% of respondents in 2009, but only 20% offer it for 2010.  Assistance selling a home is provided by just 11%, down from 13% in 2009 and 20% in 2006, while spouses are offered assistance by only 10%, down from 15% in 2009 and 21% in 2006.  Only 3% of respondents provide rental assistance for 2010, down from 12% in 2009 and 22% in 2006.       Not so surprisingly, marginal perks that were more popular in a better economy, like dry cleaning services and concierge services, also have declined.  Seven percent of respondents provide dry cleaning, down from 15% in 2002, while concierge services are offered by just 2% of respondents, down from 4% in 2002.  Interestingly, the number of organizations allowing everyday casual dress also has dropped to 34%, down from 41% in 2005, and 51% in 2001.  In addition, some hotel expense reimbursements are on the decline, such as pay-per-view movies (5% in 2010, down from 12% in 2002) and mini-bar snacks (9% in 2010, down from 20% in 2002).   Benefits Remain Key Part of Compensation Package While the recession has had some impact on the type of benefits employers offer, these benefits remain an important part of employee compensation and retention.  According to the SHRM 2010 Job Satisfaction Survey Report, 60% of responding employees identified their employers’ benefits package as a key element to their job satisfaction.         The SHRM benefits survey also underscores the investment employers must make in these benefits.  According to the survey, the average total costs of government-mandated benefits (such as social security contributions, workers’ compensation, and unemployment insurance) were 19% of an employee’s average annual salary.  In addition, nonmandated voluntary benefits (such as health care and retirement benefits but excluding leave benefits) accounted for an additional 18%.  Paid leave benefits account for another 11% of salary.      So, to make sure you get the intended “bang for your buck,” find out what your employees actually need and want.  One way to make sure that benefit money is being spent wisely is to survey employees regularly to verify widespread needs and to identify any changing demographics or requests for new offerings.  Your employees are most likely to appreciate and value your program if they are consulted and included in the decision-making process.       The SHRM 2010 Employee Benefits Research Report is available to non-SHRM members for $199.95.  To order, call 1-800-444-5006.  SHRM members can access the full survey for free at www.shrm.org/surveys.

EEO-1 Filing Requirements (9/10)

We recently have hired a few more employees and now have more than 100.  Do we have to comply with any EEO filing requirements?

Yes.  Private employers with 100 or more employees (as well as federal contractors with 50 or more employees and a contract of $50,000 or more) are required to submit annual EEO-1 Reports to the EEO-1 Joint Reporting Committee, a committee of the Equal Employment Opportunity Commission (EEOC) and the Office of Federal Contract Compliance Programs (OFCCP).  These reports track employee data by race, ethnicity, sex, and job classification.  The EEOC uses the data to support enforcement of Title VII of the Civil Rights Act and to analyze employment patterns.  The OFCCP uses the information to target employers for compliance evaluations.        The EEO-1 Report (its full title is the Employer Information Report EEO-1) must be filed each year by September 30.  Employment figures from any period in July through September may be used.  Online reporting is the preferred method of filing, though employers are permitted to file paper reports.      Previously, employers had to collect information on just five EEO-1 race/ethnicity categories:  Hispanic, White, Black, Asian or Pacific Islander, and American Indian or Alaskan Native.  Now, as the result of a major revision to the reporting requirements in 2007, there are seven race/ethnicity categories:  Hispanic or Latino, White, Black or African-American, Native Hawaiian or Other Pacific Islander, Asian, American Indian or Alaska Native, and Two or More Races.        The 2007 revisions also changed the information gathering process.  In the past, the EEOC directed employers to obtain the racial and ethnic information by visual surveys of the workforce or from post-employment records.  Now, you are directed to ask employees to self-identify voluntarily and only rely on the old method as a back up when self-identification is not possible.  The EEO-1 instruction booklet includes sample language (found in Section 4 of the Appendix) that you can use in an employee questionnaire on race and ethnicity to explain the EEO-1 voluntary self-identification process.        The EEOC has provided helpful information on the EEO-1 Report on its Web site at www.eeoc.gov/employers/eeo1survey/index.cfm, including a discussion of the revisions to the EEO-1 form and how to implement the new racial and ethnic categories.   In addition, a copy of the EEO-1 instruction booklet is available on the EEOC’s Web site at www.eeoc.gov/employers/eeo1survey/2007instructions.cfm.