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Old 09-06-2009, 01:39 PM   #41
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Legal or not, I think it's shady. For one thing, once you've put enough time into a certain job, you can't easily just up and go somewhere else and lose all that seniority you earned. ....
This is why I wish companies provided no benefits at all, but particularly no future "promised" benefits. It messes with our ability to move from job-to-job, so that is really a "sneaky" way to infringe on the free market. The worker is hurt in the long run, but it looks like they won because they got these "benefits" (paid for out of their salary anyhow).

That is exactly what happened when companies were given a tax break for providing health insurance. The employees ended up getting tied to their job to stay insured. No good comes from this.

If every company just said "we will offer you $X", it would add to the transparency of choosing a job. Sure, you need to evaluate job security, the environment and so forth, but you still need to do that anyway. Attempting to put a value on these "benefits" and weighing future "golden handcuff" situations (unpredictable anyhow) just compounds the issue.

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Old 09-06-2009, 02:21 PM   #42
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This is why I wish companies provided no benefits at all, but particularly no future "promised" benefits. It messes with our ability to move from job-to-job, so that is really a "sneaky" way to infringe on the free market. The worker is hurt in the long run, but it looks like they won because they got these "benefits" (paid for out of their salary anyhow).

That is exactly what happened when companies were given a tax break for providing health insurance. The employees ended up getting tied to their job to stay insured. No good comes from this.

If every company just said "we will offer you $X", it would add to the transparency of choosing a job. Sure, you need to evaluate job security, the environment and so forth, but you still need to do that anyway. Attempting to put a value on these "benefits" and weighing future "golden handcuff" situations (unpredictable anyhow) just compounds the issue.

-ERD50
In our MegaCorp senior management gets graded on the number of employees they retain, usually in the 95% range. Any lower, then they get dinged on their annual review. So, the guy next to me got a higher paying job elsewhere but since he has 20+ years of experience on the MegaCorp computer systems, they matched his other offer and was retained.

I also think that our MegaCorp would be happy with socialized medicine for the reasons you mention. They would not have to compete with that aspect of the benefits package (although my friends in Canada and the UK talk about special executive care in private hospitals).

But since benefits is estimated to be 25% of the compensation package, I suspect it won't be going away soon.
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Old 09-06-2009, 02:26 PM   #43
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I also think that our MegaCorp would be happy with socialized medicine for the reasons you mention. They would not have to compete with that aspect of the benefits package (although my friends in Canada and the UK talk about special executive care in private hospitals).
MegaCorp health insurance is a double-edged sword for the company. On one hand, it's a huge expense; on the other hand, it's a huge retention advantage.

Sometimes I lament how much potential there is out there that isn't being fulfilled because people are afraid to give up MegaCorp health insurance. I have to think that a lot of entrepreneurial spirit has been trapped because people were afraid to lose that health insurance to pursue their ideas.
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Old 09-06-2009, 03:12 PM   #44
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MegaCorp health insurance is a double-edged sword for the company. On one hand, it's a huge expense; on the other hand, it's a huge retention advantage.

Sometimes I lament how much potential there is out there that isn't being fulfilled because people are afraid to give up MegaCorp health insurance. I have to think that a lot of entrepreneurial spirit has been trapped because people were afraid to lose that health insurance to pursue their ideas.
I think for most programming companies, health insurance is standard, especially since I believe you cannot offer it selectively. I worked for a four person company and it offered it. However, I know that companies that only require a minimum of a high school degree (health home care, auto parts stores and manufacturing plants) do not since their competitors do not.

I forgot to mention that in our MegaCorp a larger and larger percentage of compensation as you move up the latter is based on future performance (e.g., stock grants and stock options). In my band it averages 10% but increases steadily up the ladder. How do you match a present day salary with one that could be 10 to 20% higher.

And, of course, sticking to the topic, part of that compensation is profit sharing which goes into the 401(k) plan. Some years we have had none and some 5%.
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Old 09-06-2009, 03:25 PM   #45
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I think for most programming companies, health insurance is standard, especially since I believe you cannot offer it selectively. I worked for a four person company and it offered it.
True. To clarify my previous remarks, I was speaking not so much of jumping from one company to another, but rather of chucking it all and starting your own business (or becoming an independent contractor). Losing gold-plated employer-provided health insurance is a HUGE roadblock when it comes to people taking risks that involve losing health insurance. You have to hope to have a spouse with a secure j*b and great benefits to seriously consider it in many cases.
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Old 09-06-2009, 06:39 PM   #46
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True. To clarify my previous remarks, I was speaking not so much of jumping from one company to another, but rather of chucking it all and starting your own business (or becoming an independent contractor). Losing gold-plated employer-provided health insurance is a HUGE roadblock when it comes to people taking risks that involve losing health insurance. You have to hope to have a spouse with a secure j*b and great benefits to seriously consider it in many cases.
Well, for the two startups I worked for, not only did they have to offer health insurance to be competitive they also offered life insurance and 401(k)s. But the big difference is that I got an equity position in the company (1/60th and something smaller) so that they could compete with the MegaCorps. I ended up liking the Megacorps better when the small companies couldn't meet payroll. Something that you might run across starting your own business.
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Old 09-06-2009, 11:02 PM   #47
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I think for most programming companies, health insurance is standard, especially since I believe you cannot offer it selectively. I worked for a four person company and it offered it. However, I know that companies that only require a minimum of a high school degree (health home care, auto parts stores and manufacturing plants) do not since their competitors do not.

I forgot to mention that in our MegaCorp a larger and larger percentage of compensation as you move up the latter is based on future performance (e.g., stock grants and stock options). In my band it averages 10% but increases steadily up the ladder. How do you match a present day salary with one that could be 10 to 20% higher.

And, of course, sticking to the topic, part of that compensation is profit sharing which goes into the 401(k) plan. Some years we have had none and some 5%.

One of the problems on the health insurance side is that the small companies get screwed... I used to be in Mega and the insurance options were a lot... you could chose low deductible or high... HMO or PPO and pay the premium you wanted..... and the rest of the people at the company did not get hit if someone got sick...

At my current small company... we high only one choice... and it cost us a LOT because we are 'older' and 'sicker'.... we had one employees wife have brain problems for the last few years... and a few babies born... and this year someone with cancer... so they rate us as a high risk company and our premiums go up accordingly... and if we tried to move, they want a medical history from everybody in the firm and they will not cover preexisting conditions.... so sometimes mega is better in this regard..
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Old 09-07-2009, 09:45 AM   #48
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an expectation of a decent retirement after a career of dedicated service to one's company is not an 'unrealistic sense of entitlement'.
You are certainly entitled to hold that opinion, but I suspect it is becoming increasingly unrealistic in the globalized economy.
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Old 09-07-2009, 08:40 PM   #49
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But since benefits is estimated to be 25% of the compensation package, I suspect it won't be going away soon.
Oh yes, I certainly don't expect the benefits to go away, they have become too ingrained into the comp package. But I still think we would be better off w/o.


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an expectation of a decent retirement after a career of dedicated service to one's company is not an 'unrealistic sense of entitlement'.
Just an add-on to Milton's comments:

I always thought it was an interesting view that someone was entitled to anything "after a career of dedicated service to one's company". If you look at it as the owner of the company, you might say - " The wages I paid that employee put food on their table, bought their home, put their kid's through school, etc. I appreciate the work they did, and they were paid for it. Why should they expect anything past that agreement?".

Sure, if promises are made, they become part of the compensation package and we expect the promises to be lived up to. But that's all it is, part of a compensation package, it isn't an "entitlement".

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the american worker is putting in longer hours for lower pay and fewer benefits (adjusted for inflation), while execs are seeing obscene increases in salaries and other bonuses. very few businesses pay above market rates in salaries for the jobs most americans have.
Global competition has a lot to do with that. Would you deny some poor person in a third world country a wage that would greatly improve their standard of living, just so us (relatively speaking) fat cats can maintain our standard of living (A/C, central heat, color TVs with sat/cable DVR, more food choices than is good for us, etc, etc)?

Are executives seeing (overall) obscenely higher compensation? Maybe so, but I was wondering if that was a verifiable fact, or just an attack. References please, I'm curious myself.

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