Module 12: The Benefit Determination Process Describe the reasons for the growth of employee benefits Benefits have grown overtime and there are several factors that have contributed to the growth on benefits costs: o Wage and price controls - Government regulations that aim at maintaining low inflation and low levels of unemployment. They frequently focus on "cost-push" inflation, limiting the size of pay raises and the rate of increases in prices charged for goods and services. Used for limited time periods only. o Unions - The climate fostered by wage and price controls created a perfect opportunity unions to flex muscles they had acquired under the Wagner Act of 1935. o Employer impetus - many of the benefits in existence today o Cost effectiveness of benefits - o Government impetus