CASE STUDY 2: EMPLOYEE BENEFITS THAT MATTER
Employee Benefits That Matter
Xie Yang greeted Robert Peters, the next interviewee, warmly. Robert had an excellent academic record and appeared to be just the kind of person Xie's company, Beco Electric, was seeking. Xie is the university recruiter for Beco and had already interviewed six graduating seniors at Centenary College. Based on the application form, Robert appeared to be the most promising candidate to be interviewed that day, with a 3.6 grade point average and a 4.0 in his major field, industrial management.
Robert was not only the vice president of the Student Government Association, but also activities chairman for Kappa Alpha Psi, a social fraternity. The reference letters in Robert's file revealed that Robert was both active socially and a rather intense and serious student. One of the letters from Robert's employer during the previous summer expressed satisfaction with Robert's work habits.
Xie knew that discussion of benefits could be an important part of the recruiting interview. But Xie did not know which aspects of Beco's benefits program would appeal most to Robert.
The company has an excellent profit-sharing plan, although 80 percent of profit distributions are deferred and included in each employee's retirement account. Health benefits are also good. It also has long-term care insurance. The company's medical and dental plan pays a significant portion of costs.
A company lunchroom provides meals at about 70 percent of outside prices, although few managers take advantage of this. Employees get 1 week of paid vacation after the first year and 2 weeks after 2 years with the company. Two weeks are provided each year for sick leave. In addition, there are 12 paid holidays each year.
Finally, the company encourages advanced education, paying for tuition and books in full, and under certain circumstances, allowing time off to attend classes during the day. It also provides scholarships for dependents.
Questions
9-6. What aspects of Beco's benefits program are likely to appeal to Robert? Explain.
9-7. In today's work environment, what additional benefits might be more attractive to Robert? Explain.
9-8. What aspects of Beco's benefits program would likely be the least appealing to Robert? Discuss.Chapter 9, Case Study 1: Employee Benefits That Matter, page 248. Employee benefits can be a significant issue to a candidate when it comes to selecting a company to work for, especially if compensation is comparable. There are three parts to this case study;
1. Read Case Study 1 (Page 235) and answer all questions, 9-6, 9-7, 9-8.
2. Additionally, after reviewing the case and answering the questions, do you think Beco Electric has a competitive discretionary benefits plan? Why? Why not? Explain your rationale.
3. You are the Benefits Manager for Beco Electric tasked with "re-designing" the company discretionary benefit program, what changes would you make, add, delete, to make it more competitive? Again, explain your rationale and document your revised benefit plan.