In the ever-changing business landscape, one of the hardest things for employers is to retain their employees. Small businesses particularly have to compete the hardest with giant corporations regarding employee benefits and perks. Employee benefits are non-cash and indirect compensation offered by an employer to attract them and maintain employee satisfaction. Employee benefits may differ from company to company.
Still, there are some primary benefits that employers are legally required to provide their workers.
These legal benefits cover liabilities, mitigate economic hardships, and ensure medical care for workers and families. Let’s take a thorough look at the following benefits companies must provide their workers:
1. Workers’ compensation
Employers are legally required to comply with all the workers’ compensation requirements. These include compensation insurance which typically covers the cost of treatment, medical care, replacement income, rehabilitation, and paid leave.
All these compensations are for employees who have sustained an illness or injury on the job. The company is legally required to provide financial and medical support to employees who cannot avail regular working opportunities due to workplace hazards or injury.
Workers’ compensation is an essential benefit for employees, especially if they interact with harmful materials and products or perform risky duties. In case of workplace injury, employees must file a claim and opt for a good workers compensation lawyer to avail the benefits they deserve. An attorney can help explain your legal rights and guide you if your employer is unwilling to cooperate.
2. Medicare taxes and social security
Medicare and social securities are both federally mandated payroll tax and benefit programs. Both the employees and employers in the U.S must contribute to these funds to benefit from them later in life. Taxes for both programs are paid as payroll deductions. Social security and Medicare contributions ensure that employees have some backup income if they become permanently disabled or retire.
These benefits are every employee’s legal rights regardless of the size of the business. The tax contributions can range based on the income and the age of the employee. Social security stops being deducted from the employee’s payroll once they hit their max contributions on wage base limit.
3. Health insurance
It may come as a massive surprise that health insurance is not one of the employee benefits that are mandated federally. Meaning, employers are not required to provide employees with health insurance, but it has become an industry standard.
However, as per the Affordable Care Act (ACA), an organization with 50 or more full-time employees must offer health insurance through their workers’ benefit programs. Medical or health insurance has become more of an employee-attracting benefit than a legal one.
Almost every employee these days would expect a reputable company to pay for their health insurance. Even though health insurance benefits may differ for each company, employers must provide sufficient health insurance to full-time employees. Not doing so will result in possible penalties and other consequences from the federal government.
Most competitive companies offer dental and vision care as a part of their overall medical insurance. Still, these benefits are solely for retaining staff satisfaction.
4. Federal Family and Medical Leave
The FMLA exists to provide employees with the necessary support to balance family responsibilities and work. The Family Medical Leave Act offers employees up to 12 weeks of job-protected, unpaid leave during the 12 months. These leaves allow employees to take care of any family-related emergency, a sick family member, or look after a newborn child without the risk of losing their jobs. Again, businesses with over 50 employees must provide FMLA benefits to employees.
Along with FMLA, eligible employees who are the parent, son, daughter, spouse, or the next to kin of a covered veteran can take up to 26 weeks of unpaid leave during 12 months. The leaves are for providing care for the veteran who has sustained an injury or illness. For employees to avail the FMLA benefits, they must fulfill the following requirements:
- the employee has worked at least 1,250 hours before the start of the paid leave
- the employee must work for 12 months or longer for the company
- the company must have at least 50 full-time employees
5. Disability and unemployment insurance
Disability insurance is one of those employee benefits that are mandatory in specific states. One can consider disability insurance as a type of wage protection. It protects both the employer and employee if certain circumstances prevent workers from performing their duties due to non-work-related reasons.
States like Hawaii, New York, Rhode Island, and Puerto Rico have mandated disability insurance. Employers in other states have the option to decide whether they want to provide the benefit to their staff or not.
Along with disability insurance, another employee benefit that the government administers is unemployment insurance. This benefit assists unemployed workers or those who have lost their jobs with partial income replacement for a short period. If both full-time and part-time workers are involuntarily separated from the company, they are entitled to unemployment benefits.
Employee benefits are there to compensate for all the hard work and to retain workers so organizations can avoid employee replacement costs. Many organizations offer competitive employee benefits because perks like life insurance, paid leaves, bonuses have become an industry standard. However, there are a few employee benefits like the ones mentioned above that are legal rights of all employees in the U.S.