quote Originally posted by JazzMan: I can put a gun to your head and tell you that if you don't do something I will blow your brains out all over the wall. You can "choose" to do that something, you can "choose" not to. If that's the definition of free choice that you want to use, just be aware that it isn't mine, and IMHO doesn't reflect the reality of choice that I and many people make. I didn't "choose" to take a pay cut of $40 in the sense that I was getting something more that I didn't have before for that $40. It's not like I "chose" to go out and get cable TV, or "chose" to put money in savings, or "chose" to start going to movies again. No, this wasn't a "choice" like most people think of choices when spending their money. The reality is that this was a pay cut for me, plain and simple. I simply have $40 less to spend, period. I didn't get an increase in anything in my life, not the quality of life, not any extras, no physical property, nothing. That extra $40/month is just gone away with nothing physical or tangible to show for it. JazzMan

Do you feel your employer should have absorbed the increase in the cost of your insurance?

quote Originally posted by JazzMan: Stricker, if I lived in the make believe world where I could choose where to spend that money then I'd be happy with that "raise", but I live in the real world where the money I do have discretion on spending shrank by $40 a month.

quote Originally posted by JazzMan: I didn't "choose" to take a pay cut of $40 in the sense that I was getting something more that I didn't have before for that $40.

And, you didn't choose to take a pay cut a few months ago when gasoline was $4.00 a gallon.

Your employer did not choose to take a profit loss when costs went up....uhh, yes they did, they pitched in for your needs.
I am confused. Who is living in a make believe, pretend world, ?

James,

Come, please, take a visit. You'll find out real quick that in MY world I get to pay MY insurance and MY EMPLOYEE'S. Yes, please, welcome to my world.

Whether you like it or not, you just got a raise from your employer in that it cost him more money for you to do the same work you were doing before. Any other way of looking at it is REALLY living in fantasy land.

John Stricker

quote Originally posted by JazzMan: Stricker, if I lived in the make believe world where I could choose where to spend that money then I'd be happy with that "raise", but I live in the real world where the money I do have discretion on spending shrank by $40 a month. The real world where I have to pay for my own food, pay for my own gasoline to get to work, pay for everything that I spend. In this real world the money that I have to spend, actually spend, on things like mortgage, parts to fix my car, etc, is what matters to me. Maybe someday I'll get to go visit that fantasy world of yours, then maybe I can enjoy the benefits of my "raise", LOL. JazzMan

quote Originally posted by jstricker: James, Come, please, take a visit. You'll find out real quick that in MY world I get to pay MY insurance and MY EMPLOYEE'S. Yes, please, welcome to my world. Whether you like it or not, you just got a raise from your employer in that it cost him more money for you to do the same work you were doing before. Any other way of looking at it is REALLY living in fantasy land. John Stricker

Problem is, he seems to be of the opinion that his insurance should be provided to him at no cost. He resents having to pay for it (even though he knows that his employer is paying most of the cost) and as such he is unable to see it for the benefit it is.

quote Originally posted by jstricker: James, Come, please, take a visit. You'll find out real quick that in MY world I get to pay MY insurance and MY EMPLOYEE'S. Yes, please, welcome to my world. Whether you like it or not, you just got a raise from your employer in that it cost him more money for you to do the same work you were doing before. Any other way of looking at it is REALLY living in fantasy land. John Stricker

I wonder what the total of his health insurance is taken out of his pay? I don't mean employer contribution, I mean how much comes out of his salary? I pay $196/month for Kaiser, and NOONE is paying any portion of my insurance but me.

quote Originally posted by GT86: But if the cost of the insurance rises, and the employee is not paying for the entire cost of the increase, then yes in effect they are getting a pay raise.

Man... a lot of 'ganging up' mentality going on in this thread...

GT86... I just grabbed your quote... so this is not directed at you in particular, it just seemed to be the most condensed version of what I interpret as you, Ace, Stricker, Cliff, Don, bear & Phranc getting at...

So if that statement is true... and that logic correct...
Is this? (re-wording GT's quote)

But if the profit of the business rises, and the employee is not given a raise for the increase, then yes in effect they are getting a pay cut.

in other words,
If the employer makes a y-o-y increasing profit, and does not give the employee a raise, did the employee take a pay cut?

I'm trying to apply y'alls logic both directions. If it works one way, it should work the other, right? Help me out if I'm wrong here.

Only if you believe profits belong to both the workers and the owners (private or shareholders). They don't and never have. Discretion lies solely with the owners in that regards. You already know that but nice spin attempt nonetheless.
(The exception being is if the company has an errisa protected profit sharing plan in place)

quote Originally posted by blakeinspace: Man... a lot of 'ganging up' mentality going on in this thread... GT86... I just grabbed your quote... so this is not directed at you in particular, it just seemed to be the most condensed version of what I interpret as you, Ace, Stricker, Cliff, Don, bear & Phranc getting at... So if that statement is true... and that logic correct... Is this? (re-wording GT's quote) But if the profit of the business rises, and the employee is not given a raise for the increase, then yes in effect they are getting a pay cut. in other words, If the employer makes a y-o-y increasing profit, and does not give the employee a raise, did the employee take a pay cut? I'm trying to apply y'alls logic both directions. If it works one way, it should work the other, right? Help me out if I'm wrong here.

Tell me why if a companies profit goes that the employees have to make more too? I've never understood this concept. There is no way if an employee doesn't get more of the companies profit that he is getting a pay cut. An employee gets paid for what the market value of his job is not a % of profit.

When did people get the idea that companies are socialist enterprises? Seriously.

yes, if that is what you want to do - take your pay and buy stock in the company you work for.

quote Originally posted by blakeinspace: Man... a lot of 'ganging up' mentality going on in this thread... GT86... I just grabbed your quote... so this is not directed at you in particular, it just seemed to be the most condensed version of what I interpret as you, Ace, Stricker, Cliff, Don, bear & Phranc getting at... So if that statement is true... and that logic correct... Is this? (re-wording GT's quote) But if the profit of the business rises, and the employee is not given a raise for the increase, then yes in effect they are getting a pay cut. in other words, If the employer makes a y-o-y increasing profit, and does not give the employee a raise, did the employee take a pay cut? I'm trying to apply y'alls logic both directions. If it works one way, it should work the other, right? Help me out if I'm wrong here.

No, what I'm saying is that the insurance provided is part of the compensation. A lot of people tend to view their "pay" as the number on the paycheck. But if an employee is receiving other items of value in exchange for their time and effort, we need to look beyond just the paycheck. Some of those other items could be a company car, travel perks, housing allowances, 401k matches, profit sharing, or in this case: insurance provided at less than full cost. If an employee is given the option of purchasing an insurance plan at a reduced rate, and the company is paying the difference, why shouldn't that count as compensation? And if the value (the cost) of the policy goes up, and the employee is not paying the full increase, why are they not in effect getting a raise?

I posted this earlier, but the thread's 4 pages now and it might be hard to find, so here it is again:
Employee makes $50,000/year and is provided with a $5000/year policy. The employee pays for half of that policy, the employer pays the other half. So the employee is really getting the equivalent of $52,500 from the company. If the cost of the policy increases to $6000, and the employee still pays half, they are now receiving the equivalent of $53,000. Total compensation has gone up.

The insurance has value just as the paycheck does. It's true that the pay in dollars isn't increasing, and in fact will decrease because of the insurance price change. However, the total compensation is still going up so it's a raise. Some people look at the number on the check, and disregard any other form of compensation. Also, some have said the employee is getting the same benefit, but it is costing them more. But it's not the same benefit if the value (cost) has increased.

And no, if a company's profit increases, employees are not entitled to a raise. A company exists to make a profit, and it pays employees to help generate that profit. However, an employee took none of the financial risks, and is entitled to none of the rewards. A company may chose to share profits by increasing pay, or by other profit sharing plans, but it is up to the owners and directors whether or not to do so.

[This message has been edited by GT86 (edited 11-25-2008).]

quote Originally posted by blakeinspace: in other words, If the employer makes a y-o-y increasing profit, and does not give the employee a raise, did the employee take a pay cut? I'm trying to apply y'alls logic both directions. If it works one way, it should work the other, right? Help me out if I'm wrong here.

No, the logic fails. You're looking at overall bottom line. Just like the employee didn't get a raise if the company takes a loss.

Benefits are a part of the compensation package for an employee, assuming the premiums are paid by the employer. If the employer pays more toward a health insurance plan, that is a direct cost associated with each employee. If an employee is terminated or hired, that health insurance premium falls or rises in direct proportion. That, as opposed to things like vehicle maintenance, utilities, and rent, which are there regardless of whether the company has 19 or 20 employees. Or 399 vs. 400 employees. Whatever the case may be.

If a company hires you, your wages are NOT the total cost to the employer of employing you.

quote Originally posted by GT86: The insurance has value just as the paycheck does. It's true that the pay in dollars isn't increasing, and in fact will decrease because of the insurance price change. However, the total compensation is still going up so it's a raise. Some people look at the number on the check, and disregard any other form of compensation. Also, some have said the employee is getting the same benefit, but it is costing them more. But it's not the same benefit if the value (cost) has increased.

Thanks for the very thought provoking reply. There is something here that I am not sure that I agree with, I can't put my finger on it... I'll give it some study and see if I can figure it out.

I put a lot of thought into posts. I can tell you did to, I appreciate it.
I'm certainly Not trying to spin anything or promote a socialist agenda

quote Originally posted by blakeinspace: Thanks for the very thought provoking reply. There is something here that I am not sure that I agree with, I can't put my finger on it... I'll give it some study and see if I can figure it out. I put a lot of thought into posts. I can tell you did to, I appreciate it. I'm certainly Not trying to spin anything or promote a socialist agenda

Look at it another way: if the employer paid 100% of the insurance cost, would that count as compensation?

Thanks for the compliment. I do enjoy having pleasant discussions, even though at times I stray and post completely non-constructive things.

quote Originally posted by JazzMan: What good would 5-10k do in an HSA? A simple trip to the hospital could easily top 50k, and a cancer diagnosis can easily top half a million dollars unless you were lucky enough to die quickly, very quickly. My three days in the hospital this spring cost over $35,000, and it was just a couple of procedures. JazzMan

It would do just fine. Perhaps you weren't aware that to fund an HSA, you need to be enrolled in a high deductible insurance plan. You go to the doctor because you have a cold, you pay out of pocket. Well, out of your HSA, which is pre-tax dollars. If you have a serious medical issue like you mentioned, your health insurance kicks in and pays. It makes a lot of sense if you're buying your own insurance and are in pretty good health.

For 2008, the minimum deductible is $1100 for self-only coverage, or $2200 for a family plan, with a maximum out of pocket cost of $5,600 for an individual or $11,200 for a family plan.

The advantage is that you get a tax deduction for any contributions to the HSA, which means you're paying for medical costs and prescriptions with money you haven't been taxed on. The high deductible plans will cost less than traditional plans.

yup, source of much of the confusion.
that transition from employers costs to employees compensation

the compensation is $25 and a pat on the head
the pat on the head costs the company $5
awhile later, the guy who pats the head demands more money. the company will not pay the full amount anymore, but it will pay $5 more. the rest - $1 of your pay, is taken to cover the pat on the head. so - you now get $24, and a pat on the head. but, since it costs the company $35 instead of $30 to pay you - it is being called a raise - even tho you now get less money, and the same benifit. yes, we all get that the same benifit costs more now - but it is still the same benifit.

this is NOT a raise. the only person who got a raise is the guy who does the head patting. everyone else lost money.

quote Originally posted by Pyrthian: yup, source of much of the confusion. that transition from employers costs to employees compensation the compensation is $25 and a pat on the head the pat on the head costs the company $5 awhile later, the guy who pats the head demands more money. the company will not pay the full amount anymore, but it will pay $5 more. the rest - $1 of your pay, is taken to cover the pat on the head. so - you now get $24, and a pat on the head. but, since it costs the company $35 instead of $30 to pay you - it is being called a raise - even tho you now get less money, and the same benifit. yes, we all get that the same benifit costs more now - but it is still the same benifit. this is NOT a raise. the only person who got a raise is the guy who does the head patting. everyone else lost money.

So your opinion is that compensation is only the amount on the paycheck?

quote Originally posted by GT86: So your opinion is that compensation is only the amount on the paycheck?

no, not at all. the health coverage is part of the compensation. or, in my example - the pat on the head is part of the compensation. but, the cost is not. otherwise - just give the $$$ in vouchers, or cash, or whatever, and let everyone get it on their own. your compensation is not $$$/yr + so many dollars in health care. it is $$$/yr + health care. or $$$/hr + pats on the head and NOT $$$/hr + so many $$ in head pat coupons.

quote Originally posted by Pyrthian: no, not at all. the health coverage is part of the compensation. or, in my example - the pat on the head is part of the compensation. but, the cost is not. otherwise - just give the $$$ in vouchers, or cash, or whatever, and let everyone get it on their own. your compensation is not $$$/yr + so many dollars in health care. it is $$$/yr + health care. or $$$/hr + pats on the head and NOT $$$/hr + so many $$ in head pat coupons.

Are you saying health care should be 100% paid by the employer?

So, an employee makes in 2008:

$20/hr plus 70% of health care insurance and health care insurance costs $5000 last year.

Or the employee makes $40,000/year in pay and $3500/year in health care insurance. Or $43500 in simple pay and compensation. He pays $1500/year out of his paycheck for health insurance.
$43500-$1500=$42000

In 2009:

The Employee makes $20/hr plus 70% of health care insurance. This year health care insurance now costs $7000.

The employee makes $40,000/year in pay and $4900/year in health insurance. $44,900 for simple pay and benefits which is defined as COMPENSATION. He pays $2100/year out of his paycheck for health insurance.
$44900 - $2100=$42,800

Math says........ The Employee nets $800 more in compensation in 2009. That would be a RAISE in compensation.

We can play the game with inflation....

You can argue that if inflation goes up from 5% to 10% and you only got a 3% pay raise that you actually got a pay cut. Not true. You got a pay raise. The cost of living went up. But, YOU GOT A PAY RAISE

quote Originally posted by GT86: Are you saying health care should be 100% paid by the employer?

I dont think that matters one way or another. I just dont want people spouting of junk like "its a raise!" when it clearly is not.
if you your compensation package is $$$ + health care - your compensation is the $$$ + health care NOT $$$ + the cost of the health care

Employee's compensation package was more in 2009 than it was in 2008?

IT'S A FRIKKEN RAISE!

In 2008 a pizza delivery driver gets 25 cents a mile for deliveries. Gas was say $2/gallon.

In 2009, the pizza parlor gives the driver 40 cents a mile but gas went up to $4/gallon

Are you going to argue that the Pizza Parlor DID NOT give the delivery driver a RAISE in compensation because external costs went up?

SAME LOGIC. Both got raises in compensation!

quote Originally posted by Pyrthian: ......if you your compensation package is $$$ + health care - your compensation is the $$$ + health care NOT $$$ + the cost of the health care

If your compensation package is $$$ plus mileage that mileage figure is subject to the cost of living.
Do you get a raise if the employer increases your mileage compensation when fuel rises ?
Aceman beat me to it.

[This message has been edited by cliffw (edited 11-25-2008).]

It's not a difficult concept to grasp.

Employees should look at what their total compensation package actually is, not just what is on the paycheck every two weeks.

For example, my full time hired man doesn't make much money, relatively speaking. It's more than minimum wage but less than $10/hour. But that's just the start of it.

He has a house furnished to live in, at no cost.
He has 40 acres of pasture for his wife's horses and a few of his cattle, at no cost.
He can borrow my tractor, and other equipment, (tractor rents for about $90/hr, BTW) at no cost.
He runs some of his cattle in my pasture with my cattle, at no cost.
I pay his portion (the individual portion) of his health insurance every month (he pays about $80/mo to cover his wife).
He has full use and free reign of my shop whenever he needs it.
I pay all of his utilities except propane.
I furnish him one truck to drive to work and use for work, but he is welcome to use it for his personal use a well.
I match up to 5% of his paycheck in contributions to his IRA (he's maxing that out every paycheck).
I of course have to pay half of his SS contributions.
He gets 1/2 a hog and 1/4 of beef every year.
He is expected to work whatever hours need to be worked, sometimes 18 hour days in the summer, and he knows this. He also knows that during the winter, he may only be working 5 or 6 hours a day sometimes if he has other things he can do for himself. He likes and appreciates the flexible hours because he has 2 side jobs (that he's always told me about before to see if I'd object or they'd interfere with his main job) so he can do them on his off time. Right now he just left to go mow road ditches for the township and is done for the day.

Now if he tells someone what he makes on his paycheck, is that really reflecting what he is COMPENSATED for working for me? It's the same with every other employer. Some have almost no perks and the $$$ are all the compensation they get. Others have a few. Still others, like mine, make more in "benefits" than they do on their paycheck. It's the entire compensation package that you have to look at, both what the employee receives and what it costs the employer, that really matters.

John Stricker

quote Originally posted by blakeinspace: Thanks for the very thought provoking reply. There is something here that I am not sure that I agree with, I can't put my finger on it... I'll give it some study and see if I can figure it out. I put a lot of thought into posts. I can tell you did to, I appreciate it. I'm certainly Not trying to spin anything or promote a socialist agenda

quote Originally posted by aceman: Employee's compensation package was more in 2009 than it was in 2008? IT'S A FRIKKEN RAISE! In 2008 a pizza delivery driver gets 25 cents a mile for deliveries. Gas was say $2/gallon. In 2009, the pizza parlor gives the driver 40 cents a mile but gas went up to $4/gallon Are you going to argue that the Pizza Parlor DID NOT give the delivery driver a RAISE in compensation because external costs went up? SAME LOGIC. Both got raises in compensation!

the employee compensation cost the employer more in 2009 than in 2008. true.
employee received LESS money and the same coverage in 2009 than in 2008. also true.

again: the compensation is the health care - not the value of the health care or the cost of the health care.

quote Originally posted by Pyrthian: again: the compensation is the health care - not the value of the health care or the cost of the health care.

That's the flaw in your argument. Employers don't provide health care, they offer insurance that covers the cost of the care. That insurance has a cost, and therefore a corresponding value. Part of that cost is paid by the employer, but the employee receives the value. So, your employer is giving you something of value as part of your compensation. If the total value of that compensation goes up, you just got a raise, regardless of what your paycheck says. As we've already covered, compensation is not just the number on the check.

quote Originally posted by Pyrthian: again: the compensation is the health care - not the value of the health care or the cost of the health care.

ILLOGICAL

So if an employer was two employees. He pays 100% of the cost of the health insurance for both. Both make $40,000/year plus $5000/year in health insurance.

Employee A has a stroke, a heart attack and a lung transplant. That cost the insurance $1,000,000

Employee B had the flue and it cost the insurance $200

So in your illogic....

Employee A was compensated $1,040,000

Employee B was compensated $40,200?

quote Originally posted by jstricker: It's not a difficult concept to grasp. Employees should look at what their total compensation package actually is, not just what is on the paycheck every two weeks. ....

well, apparantly it is.
the package is: $5, a pickle, and a pad of paper

of course, to the employer - all that is seen is the $$$ amount it will cost him.
to the employee - it is $5, and some stuff.
the pad of paper suddenly becomes way expensive - and the employer decides to take $1 away to help pay for the pad of paper.
so, now, the package becomes $4, a pickle, and a pad of paper.
even tho the package costs the employer more - the employee receives less.
and, yes - it may in fact have a higher monetary value. but - employee still receives less.
I expect that is the what is confusing.
the compensation is the coverage - not the value of the coverage. but, since the recent spikes in coverage costs, now employers are playing this "your getting a raise" game - even tho you are receiving less

You cannot logically define "COMPENSATION" without placing a value on what is being given.

You are trying very hard to not place a value on what you call compensation, but "value" and "compensation go hand in hand.

quote Originally posted by GT86: That's the flaw in your argument. Employers don't provide health care, they offer insurance that covers the cost of the care. That insurance has a cost, and therefore a corresponding value. Part of that cost is paid by the employer, but the employee receives the value. So, your employer is giving you something of value as part of your compensation. If the total value of that compensation goes up, you just got a raise, regardless of what your paycheck says. As we've already covered, compensation is not just the number on the check.

well - if this was the case - why not just provide "health care vouchers" as compensation, instead of playing this stupid game? or just pay the employees more, and let them get their own coverage? because the employer gets their own benifits by providing the health care. because not all employees participate. and, go ahead, and see if those who dont particapte get this magical raise which leaves people with less money.

and - yes - compensation is not just the number on the check. it is also the items. not the value of the items, not the cost of the items - it is the items.

quote Originally posted by aceman: ILLOGICAL So if an employer was two employees. He pays 100% of the cost of the health insurance for both. Both make $40,000/year plus $5000/year in health insurance. Employee A has a stroke, a heart attack and a lung transplant. That cost the insurance $1,000,000 Employee B had the flue and it cost the insurance $200 So in your illogic.... Employee A was compensated $1,040,000 Employee B was compensated $40,200?

No both employees recieved the same insurance. One employee used more of the insurance this year, but both probably have a lifetime cap.

quote Originally posted by Pyrthian: even tho the package costs the employer more - the employee receives less. and, yes - it may in fact have a higher monetary value. but - employee still receives less.

If an employee gets a 3% increase in wages, but inflation is 4%, did that employee receive a raise or not?

quote Originally posted by Pyrthian: the compensation is the coverage - not the value of the coverage.

Apply that to a mileage allowance ?

quote Originally posted by aceman: You cannot logically define "COMPENSATION" without placing a value on what is being given. You are trying very hard to not place a value on what you call compensation, but "value" and "compensation go hand in hand.

so, why go thru all this? why not just pay the full amount of the employers costs as the compensation?
because all this BS also costs money, dont it? it costs money to provide the health care, dont it? why not just give the value as compensation?
because you know as well as everybody else - thats not the same thing, is it?

quote Originally posted by GT86: If an employee gets a 3% increase in wages, but inflation is 4%, did that employee receive a raise or not?

Pyrthian will not answer that question because he enjoys stirring the pot with illogical arguments.

Logic says, yes, you got a raise. Are you still taking it in the rear in the world? Yes. But, that's not your employer's fault. But by God, the employee has to blame someone. Blame The Man!

EDIT: Very well then, Pyrthian....

Cost of Health Insurance Inflated from $1000 to $1100 this year or 10% Your employer paid $70 more a month and you paid $30 more a month. YOU STILL GOT A RAISE! Your employer could have said, "Nope, not going to pay the increase. We're just going to get less coverage." Whoops! NO RAISE! Your pay stayed the same. But, you got a DECREASE in the value of your compensation.

[This message has been edited by aceman (edited 11-25-2008).]

quote Originally posted by Pyrthian: of course.

Even though they are ending up with less than they had the year before? Earlier, you said that wasn't a raise.

quote Originally posted by cliffw: Apply that to a mileage allowance ?

ok - I suppose doing it in the same format would be the way to do this:
you get coupons for gallons of gas.
as gas prices increase, now you get coupons for 70% of a gallon of gas, and you need to cover the rest
overall - more money is being put out for gas, both from you, and your employer.

quote Originally posted by Pyrthian: ok - I suppose doing it in the same format would be the way to do this: you get coupons for gallons of gas. as gas prices increase, now you get coupons for 70% of a gallon of gas, and you need to cover the rest overall - more money is being put out for gas, both from you, and your employer.

But, that is not how it happens. Your logic is very flawed and has failed a simple test of said logic.

quote Originally posted by aceman: Pyrthian will not answer that question because he enjoys stirring the pot with illogical arguments. Logic says, yes, you got a raise. Are you still taking it in the rear in the world? Yes. But, that's not your employer's fault. But by God, the employee has to blame someone. Blame The Man! EDIT: Very well then, Pyrthian.... Cost of Health Insurance Inflated from $1000 to $1100 this year or 10% Your employer paid $70 more a month and you paid $30 more a month. YOU STILL GOT A RAISE! Your employer could have said, "Nope, not going to pay the increase. We're just going to get less coverage." Whoops! NO RAISE! Your pay stayed the same. But, you got a DECREASE in the value of your compensation.

no, just didnt want to flood with endless responses to each and every one of you saying the same things. of course he got a raise.

and, in the last example - now you are changing the coverage - so everything gets changed, and there is no valid comparison.