Essay on "Benefit Plan Design Analysis"
Essay 15 pages (5041 words) Sources: 6
[EXCERPT] . . . .
Wal-Mart Benefit Plan AnalysisWal-Mart describes its benefits plan in fairly flowery terms. They state that they offer a comprehensive benefit package that can provide up-front cash to pay medical expenses. Also, they tout bonus incentive programs as well as up to a six percent match for their 401(k) system (Wal-Mart Opportunity & Benefits, 2012)
However, despite the window dressing that Wal-Mart has placed around their benefits, the reality is not quite that simple. Not all of the associates, for instance, are covered by the health plan. Of the 1.1 million employees Wal-Mart has, not even two thirds of them (700,000) are even eligilble for the benefits. Even when the benefits are available, the results for associates, which is what Wal-Mart calls its employees, are mixed. For example, Wal-Mart issued a revised "preferred prescriptions" list in July 2009 and only 128 preferred brands were on that list. Many drugs were replaced with a single brand that was meant to encompass all of the drugs that would normally be used (Edwards, 2009).
In informing the employees about the change, they noted that non-preferred drugs would be eliminated from the grogram and that the prior preferred vs. non-preferred arrangement was being shut down. The only exception to this was specialty drugs. Many employees were very uhappy with this change. One employee noted that no effective alternatives, if any existed at all, to some drugs and that employee cited Athrotec and Ambien CR as examples. The latter is time-released whereas many comparable generics are not (Edwards, 2009).
In 2011, the news worsened with the corporation announcing that it was r
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olling back its health benefits for part-time workers still further. The new plan stated that Wal-Mart will no longer provide health coverage for employees who work less than 24 hours per week, whiles those who work between 24 to 33 hours per week can still receive coverage for themselves and their children. Their spouse must look for health insurance elsewhere.download full paper ⤓
In 2012, Wal-Mart proceeded even further by slashing the health care benefits of all of their workers in half. Benefits for family members were reduced to $500 per annum, whilst healthcare costs for employees were subsidized by just $250 per year. Employees have complained that the deductible alone could amount to 20% of the worker's annual pay.
Given those facts, therefore, it is not surprising that more than half of Wal-Mart's employees opt out of the company's so-called health insurance benefits. Many employees find the costs more expensive than the benefits. "Wal-Mart pays 67% of the cost of health insurance for employees, about equal to the retail industry average of 68% for family coverage-but, for individual health insurance, far below the 77% that retailers contribute on average" Deductibles are $1,000 for a plan with a low premium -- and this excludes routine treatments such as flu shots and child vaccinations (Evaluating Wal-Mart's health insurance).
Wal-Mart has always been known as a cheap organization. It has made its money and its notoriety that way. The reputation of its benefits package, consequently, conforms to its general reputation: miserly and poor as the company expands and becomes wealthier. Concerned social activists and simply those with an axe to grind have long criticized the corporation for its miserly habits in general including its poor treatment of employees) and its disreputable health benefits in particular. Many of the benefits, too, that appear on paper (as, for instance, on its website) disintegrate when analyzed more closely. That this is the case was exemplified here in connection with their health plans.
To reform and amend Wal-Mart's benefit package is the beyond the energy of one individual - certainly beyond my realm. A theoretical plan would be to draw public attention to their shortcomings -- which has already been done -- and to provide Wal-Mart's veteran, dedicated and full-time workers with a more generous package that is commensurate with their character and work. Health benefits should be increased and more drugs made available. Details should be worked out so that benefits equitably reflect worker's duration of employment as well as quality of service. These are some of my ideas. To get Wal-Mart to accept them is another story.
Statement of the Issue
The basic issue involved here is whether Wal-Mart is simply being cheap and treating their employees like an expendable commodity or if they simply cannot afford to provide health care coverage on an acceptable scale to 1.1 million employees. After all, Wal-Mart is the largest employer in the world.
The point of this paper is to offer constructive solutions and theories from research that suggest how Wal-Mart could or even should proceed. The major issue is that Wal-Mart has a ton of employees yet they have balance keeping employee benefit costs low and meeting the social responsibility demands of other firms. Wal-Mart is far from being the only firm that engages in these practices but they get the most attention because they are the proverbial elephant in the room which means that no other company could or would do what Wal-Mart is doing on such a massive scale.
The degree to which employee involvement and choice is or is not part of the equation is also worth of review. People often treat this as ancillary to the overall concern but such a viewpoint is short-sighted. That being said, employees not choosing to work at the best corporation in terms of concerns like coverage for children or spouses would be throwing them under the bus and it is a clear divergence from the major points, those being social responsibility and the amount of resources that Wal-Mart has. Especially in tough times, Wal-Mart argues that the retail industry is cut-throat and unforgiving but many others reply by saying that Wal-Mart has the resources to do the right thing and they should do so.
Literature Review
One article the author of this paper founds ties in nicely to the fact that Wal-Mart is far from the only large retail entity that is seemingly giving their retail employees short shrift when it comes to benefits. In an article dated in May 2011, it is noted that many union voices have started hurling their invective towards Wal-Mart's most formidable competitor, that being Target. The United Food and Commercial Workers Union mounted the first broad campaign to unionize the roughly five thousand workers at nearly 27 stores in the greater New York City area. It should be noted that Wal-Mart has next to no presence in that area (Greenhouse, 2011).
An employee of one of the affected stores went on record as stating that she earned nearly twelve dollars an hour but that she believed Target should have union or legal compulsion to pay people a living wage. Target countered this by saying their benefits are competitive with the industry and that, as such, there was no need for a union to be formed (Greenhouse, 2011).
However, in drilling deeper in the results, it was found that a major complaint about Target and its practices was less about insurance and more about a dearth of hours worked per week by each employee. Indeed, many employees were assigned to work only one or two shifts a week which can bring great stress to a person or family that is simply trying to get by. It is finally noted in the story that Target had nearly 1800 stores as of 2011 and Wal-Mart had north of 4400 and none of them were unionized. Wal-Mart in particular has gone so far as to shut down stores instead of being subject to a union (Greenhouse, 2011).
Another story reviewed for this report will most certainly be controversial to many. The story, which appeared on the Forbes website in early 2008, actually was so bold as to say that Wal-Mart and its benefits brings a net benefit to the communities and areas in which it inhabits, rather than being cancerous to the community's smaller businesses and its overall populace. A study conducted from 1985 to 2003 found that personal income, overall employment and retail employment all grew faster in areas with Wal-Mart as opposed to areas that did not have Wal-Mart's. Additionally, nine in ten employees that work at Wal-Mart are covered under some health plan, whether it be their own or a spouse's and that is line with industry averages (Van Riper, 2008).
The story goes on to note that Wal-Mart, by itself, is responsible for six percent of retail and food store goods in the United States and this number grows to seven and a half percent if you include food sales. A Pew study found that more than four fifths of the population thought that Wal-Mart was a good place to shop and roughly nine in ten people around the country live within 15 miles of at least one Wal-Mart. That being said, roughly a quarter of the population thinks that Wal-Mart is bad for the community and/or the country and nearly a third of people hold an… READ MORE
Quoted Instructions for "Benefit Plan Design Analysis" Assignment:
“Thisproject is designed to provide you with a real-life practical application of an organization*****s Human Resource benefits program. You will create a written analysis of a real-world organization*****s benefit plan design with suggested opportunities for improvement that use the concepts and knowledge introduced in this course.
I am sending Part 1 as a resource. Please complete Parts 2-8.
*Part 1: Select and profile an organization for the benefit plan*
There are a number of ways in which an organization and benefit plan can be selected. You have the option of looking at your current employer*****s benefit plan, a previous employer, or a random organization of your choice whose benefit plan has a perceived need for either a revision of specific benefits, addition of needed benefits, or an overhaul of its benefits program. Provide a clear profile of your chosen organization as well as the organization*****s current benefits program. Present key facts that are important in understanding your chosen organization*****s benefits program.
*Part 2: Statement of the issue*
This section should present an analysis of the major benefits issue/issues. It should include a statement of the specific benefit plan you are addressing. Some questions to ask when formulating the statement of issue include:
Have I identified the basic issue or am I dealing with the symptoms?
What is the point of the paper?
If I have identified more than one issue, are the issues separate or related?
There are several sources from which the issues can be determined. They include business documents, such as employee surveys and competitive analysis reports; assessment questionnaires that can be created to probe for areas of benefit needs and employee desires; observations of how employees use or do not use their current benefits; and interviews with key management and selected employees to determine benefit issues.
*Part 3: Literature Review*
Address what was discovered in the search of relevant literature, related articles, and the employee benefit text, as well as what was discovered in Part 2. This means not only reviewing theories, concepts, and studies discussed in the text or in class but also reviewing websites and what other *****s have to say about benefit plans. Given the limited number of weeks that a term provides and the number of steps involved in the course project following the literature review, no more than two weeks should be spent in reviewing literature.
It is critical that those completing questionnaires, being interviewed, or providing information in any other manner be assured that their responses will be kept in the strictest of confidence and will not be discussed in whole or part to any member of the organization or outside the boundaries of the classroom. I recommend you begin your literature search by accessing the Keller*****s Online Library. While you may use information obtained from HR-related websites, you must also obtain information from current scholarly journals, business publications, and newspapers. Ten or more outside resources or references are required.
*Part 4. Issue Analysis*
Here, we are bringing Parts 2 and 3 together. This section should provide a detailed analysis of the benefits issue that was identified in Part 2. A major objective is to clearly illustrate how the concepts of the course and gained knowledge of benefits are being used, as well as to show what was learned from the literature review. Show that you are applying course material.
*Part 5. Issue Solutions*
Create a developmental strategy. Offer several solutions or options that are appropriate for the benefits issue or issues. The solutions should follow logically from the analysis. The expected outcomes, positive and negative, should be addressed.
*Part 6. Solution and its Implementation*
This segment should outline your recommended solution to the identified issue. The solution will be one or a combination of the solutions provided in Part 5. This part should be specific, stating what benefit plans are recommended, timing for implementation, and in what sequence. It includes not only what should be done, but also how it should be done. A specific solution should indicate what benefit is most appropriate for the issue and how it will be implemented in the organization. Some questions to keep in mind when writing the solution section include the following:
Has an awareness of the problem of implementation been addressed?
Have you been too general?
Does the solution and implementation address the issues identified earlier?
Does my solution take into account the identified pros and cons?
How will you evaluate the effectiveness of the implemented benefit plan?
What process checks or procedures will I put in place to institutionalize the improvement?
Was the realism of your proposed action plan assessed? For example, is there adequate time, money, and other resources for your solution?
*Part 7: Justification*
This section of your analysis should, using course knowledge and concepts, tell why your solution and implementation would work. A major objective is to clearly show how you are applying course concepts and content to arrive at a workable solution and implementation for the issue identified. Some questions to ask when writing your justification segment include:
Have I applied the appropriate course material?
Do I support my conclusions and recommendations with appropriately referenced facts, quotes, readings, and class activities?
Does my justification recognize the pros and cons identified earlier?
*Part 8: Reflection*
Think about this assignment and write a well thought-out reflection statement about how this assignment influenced your thinking about benefits.
**The following are best practices that should be used in preparing this paper**
Cover Page
Table of Contents - List the main ideas and section of your paper and the pages in which they are located. The illustrations should be included separately.
Introduction - Use a header on your paper. This will indicate you are introducing your paper.
Sub-Title each section ***** Use the section titles to indicate in the body of your paper each individual section (i.e. Statement of Issue, Literature Review, Issue Analysis, etc.) Each section should be clearly marked.
Body of Your Report - Use a header titled with the name of your project. Example: *****The Development of Hotel X - A World Class Resort*****. Then proceed to break out the main ideas. State the main ideas, state major points in each idea, provide evidence. Break out each main idea you will use in the body of your paper. Sub-titles will help divide each individual section; separate group of paragraphs; or headers. Include the information you found during your research and investigation.
Summary and Conclusion - Summarizing is similar to paraphrasing but presents the gist of the material in fewer words than the original. An effective summary identifies the main ideas and major support points from the body of your report. Minor details are left out. Summarize the benefits of the ideas and how they affect the industry.
Work Cited - Use the citation format specified in the Syllabus.
Additional hints on preparing the best possible project.
Papers should be formatted according to APA or MLA guidelines (12 point font; double-spaced; include a cover page, table of contents, introduction, body of the report, summary or conclusion, and works cited page).
Even though this is not a scientific-type writing assignment and is mostly creative in nature, references are still very important. At least six authoritative, outside references are required (anonymous authors or web pages are not acceptable). These should be referenced according to APA or MLA guidelines.
Appropriate citations are required following APA or MLA guidelines.
Here are the Length of pages guidelines:
Part 2: Statement of the issue 1 Page
Part 3: Literature Review 4 Pages
Part 4. Issue Analysis 1 Page
Part 5. Issue Solutions 2 Pages
Part 6. Solution and its Implementation- 4 Pages
Part 7: Justification 2 Pages
Part 8: Reflection 1 Page
*****
*****
How to Reference "Benefit Plan Design Analysis" Essay in a Bibliography
“Benefit Plan Design Analysis.” A1-TermPaper.com, 2012, https://www.a1-termpaper.com/topics/essay/wal-mart-benefit-plan-analysis/9582737. Accessed 3 Jul 2024.
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