Employee benefits are an increasingly important element of employee compensation packages. The term employee benefits refers to compensation other than hourly wage, salary, or incentive payments. Examples of just a few specific employee benefits include paid vacation, medical insurance coverage, retirement plans, and tuition reimbursement. The federal and state governments mandate specific benefits based on a variety of laws (e.g., the federal Social Security Act of 1935 and subsequent amendments) and specify minimum standards to qualify for favorable tax treatment (thanks to the Employee Retirement Income Security Act of 1974). Government mandated benefits usually focus on protection against loss of income for a variety of reasons (e.g., disability benefits for workers and family members). Employers also choose to offer several benefits to employees that fall into three categories:

• Protection programs
• Paid time-off
• Services

Despite the importance of employee benefits, this segment of compensation packages is not very well understood, mainly because of the vast array of regulations that govern employee benefits practices. In addition, many employers tailor benefits to the needs and preferences of their workforces, making it difficult to stay abreast of all the possible practices. Further, employee benefits historically were treated as a response to government regulations. In many respects, mandated benefits were simply taken for granted. Finally, companies offer benefits because their competitors do. Except for government-mandated benefits, companies offer many benefits to receive favorable tax treatment by reducing taxable income and to avoid competitive disadvantage by attracting and retaining the best-qualified employees.

The fourth edition of this book— Employee Benefits: A Primer for Human Resource Professionals —was written to promote an understanding of employee benefits programs among current human resource practitioners, employees who simply wish to gain a fuller understanding of employee benefits practices, and among students enrolled in college-level compensation and benefits courses. For practitioners, this book will serve as an introductory reference guide. It will help practitioners put benefits practices into the appropriate context and to orient them toward asking the right questions of experts related to employee benefits (company accountants, attorneys, managers of benefits, the federal government, etc.). For instance, “Why do we reduce company-sponsored retirement benefits for retirees who also receive Social Security benefits?”

Employees will gain a more complete understanding of how and why employers provide benefits as they do. They will find answers to important questions such as “Why do more companies favor defined contribution plans over defined benefit plans?” and “How do companies determine vacation eligibility?”

For students, HR majors and other business majors at the undergraduate and graduate levels will benefit from this book. There are no prerequisites. It can be used in courses on employee compensation, employee benefits, and human resource management. This book contains 12 chapters, organized into four parts:

• Part 1: Introduction to Employee Benefits
• Part 2: Retirement, Health, and Life Insurance
• Part 3: Services
• Part 4: Extending Employee Benefits: Design and Global Issues

Each chapter contains a chapter outline, learning objectives, key terms, and discussion questions.