Provide an detailed overview on the topic indirect pay/benefits. Use the information given:

• Indirect Pay:
• any type of employer-provided reward (or "benefit") that serves an employee need but is not part of base or performance pay
• 15% of total compensation in medium to large private-sector firms
• 17% in manufacturing sector down to 10% in the accommodation/food industry, where many employers don't provide any benefits beyond the statutory minimum
• Other research put this cost between 10-20% of the total compensation, depending on the type of employers surveyed

Benefits mandated by law

1. (including employer contributions to the Canada/Quebec Pension Plan, Employment Insurance, and Workers' Compensation benefits.)
2. Deferred income plans (known as retirement or pension plans).
3. Life insurance; extended medical, dental, and disability insurance; and other types of health benefits.
4. Pay for time not worked, such as paid holidays and leaves.
5. Employee services (ranging from psychological counselling to food services).
6. Miscellaneous benefits, which may range from provision of company cars to purchase discounts on company products or services.

• Advantages
  • Competitive pressure
  • Matches unionized firms
  • Favourable tax treatment
  • Economies of scale in purchasing
  • Protect financial security and peace of mind
  • Protect employees from adversity
  • Can support managerial strategy
  • Promote consequences that benefit the organization
• Disadvantages
  • Cost can be substantial
  • Rigidity
  • Difficult to eliminate once provided
  • Difficult to develop efficient benefits package
  • Admin and communication costly
  • Does not motivate task behaviour
  • May cause excessive employee stability
  • May encourage undesirable behaviour
  • Impact of indirect pay on performance still unclear