5 Ways Employers Provide Benefits to Different Classes of Employees

5 Ways Employers Provide Benefits to Different Classes of Employees iStock

Employers are permitted to award employees differently based on class at the workplace. Class of employees is determined by a number of factors, including how long a person has worked in a firm, the position they fill and changes in legislation and. The following points highlight ways in which you can establish how to award your employees, together with the reasons why:

#1 Awarding Benefits Based on Rank

The easiest way, to determine benefits, is by separating your employees based on their position within the corporation. You have to be careful not to overlap each role or to assign employees with similar roles different classes as this can lead to conflict. Each position should have distinct descriptions of what the work entails so that employees are rewarded appropriately.

#2 Duration of Work

At different employment milestones, you can offer additional compensation or benefits to an employee. Employees, who have worked in specific positions or have generally contributed to your business for a longer period, are entitled to higher benefits than workers who you’ve hired more recently. As a result, they automatically belong to a different class.

#3 On the Basis of Inclusions in the Law

Federal regulations define stipulations for compensation such as the health condition of an employee. For instance, under the Health Insurance Portability and Accountability Act of 1996, employers are permitted to limit coverage for individual treatments, illnesses or drug types that are deemed medically unnecessary, provided they do it for all individuals in similar positions.

#4 For Biased Groups

You might find in your assessment of benefits awarded to employees that you have left out minority groups, women or the disabled. Tackle this by giving them room to address their complaints either through you as their supervisor or through the Human Resource Department. Avoid unnecessary investigations or accusations that could be launched against you by the Equal Employment Opportunity Commission on behalf of your employees.

#5 Based on Dependants

Even though employees are working in the same position, there might be a discrepancy in how many people depend on their income. Drawing a plan to award benefits to an employee based on how many dependants they have is another way of distinguishing class. You can find guidelines for this under the Patient Protection and Affordable Care Act (PPACA), which stipulates among other important details that adult dependants can only be covered until the age of 26. Have your employees fill out documents with supporting evidence to be able to claim such benefits.

Awarding varying benefits to employees is a controversial issue, but it is a practice protected by law. How you choose to go about awarding benefits is left to your discretion, so you have to ensure good judgment when executing decisions to do with compensation to employees. Nevertheless, ensure you’re following bona fide employee-based classifications in these decisions as you’ll be fully accountable to the Equal Employment Opportunity Commission (EEOC).