Importance of Employee Benefits Administration
Business owners should understand that today’s employees looks more than a job and a paycheck. For that reason, organizations often offer different types of employee benefits like healthcare, dental and vision, car allowance, 401K, etc.
Manual computation need enormous time, a lot of paper work, manual administration, and uncertainty in employee benefits administration management. Depending on the size and the type of business, benefits vary accordingly.
In AX2012, Benefits are created by the HR manager in the HCM module, which is directly integrated with the “Payroll” module, in other terms, employees’ deductions and the company’s contributions will automatically be calculated in the payroll module, once they are set up properly and assigned to employees, without further steps.
Thus, AX had made it very simple for employers to manage their employee benefits based on the employees’ eligibility and the enrollment events they can create in AX2012.
- Benefit setups
- Benefit Administration
Setting up the benefits requires a series of steps that has to be followed in order.
- Benefit Type
- Benefit Plan
- Benefit Options
Benefit type is where the Benefit’s name is specified, as well as the enrollment type (one time enrollment or multiple enrollments allowed), and finally the payroll category type.(Standard, retirement, etc.)
Benefit Plan allows the HR manager to define the payroll impact of this benefit, whether it is a contribution only, a deduction only, or if it is a contribution and a deduction. To define the Tax rules that apply, the retirement plan, the payroll details, the accounting or in other terms the financial dimensions, and the reporting.
Benefits Options define the different options available for the plans, it can be “employee only” or “employee and family”. It is also where the HR manager defines whether dependent coverage is allowed or not for a certain benefit, and if there is any beneficiary designations for the benefit.
After finishing all the necessary setups, the HR manager can now manage employee’s eligibility based on different criteria.
For example, if the employee is full time, he is directly enrolled in the health insurance plan, etc. In addition to that, mass benefits enrollment makes the task of enrolling eligible employees very easy and fast. Also, eligibility events, or open enrollment events can be created to make the process of enrollment automatic.
Employee Self Service
The “Employee self-service” or “enterprise Portal” in AX2012, allows employees to simply view and access their benefits.
CEM Add-on Benefit Administration, allows employees not only view their benefit, but also to manage their benefits, by choosing the plan, changing the plan in case of a life event change, and opting to enroll in a benefit or to waive it.
CEM Benefit management made ESS and AX more interactive, by offering the possibility to the company to display on each benefit the advantages of the plan, in addition to the possibility of including a “Disclaimer text” in case the employee decides to waive the benefit, so the company’s compliance remains intact.
At the same time, employees can change their benefit options, they can chose their deduction amount, and they can choose the effective date.
CEM add-on “Benefit Change History” report is a very useful tracking tool for employees’ benefits change history. It gives a clear overview of the history of each benefit for employees from the moment they joined the company till date.
HR managers can track
- Date of enrollment
- Date of the benefit expiration
- Benefit option change, (for example: Medical coverage change from “employee only” to “employee with family”)
- Change of the contribution
- Deduction amount along with the effective date, the person who made that change
Which is important in case of any conflict to have a reference, and the date of that change.
It also shows the list of employees who decided to waive a particular benefit, as well as the employees who didn’t take any action, allowing the HR manager to identify them, and follow up with them, so they can either enroll or waive the benefit offered by the company in case the State or Federal law requires an action by the latter.
This information is crucial for the company as it helps the HR manager to provide all the required information during audits, or in case the employee want to have access to his benefits history.
In conclusion, this report offers the flexibility to filter by date, by employee, or by benefit. It also shows the date of the benefit option change and by whom, and of course, like any AX2012 report, it can be easily exported to excel where it can be sorted, filtered and analyzed to provide whatever information required.
For further details visit www.cembs.com or write to firstname.lastname@example.org