EMPLOYEES BENEFITS IN STATE AND LOCAL GOVERNMENTS, 1987

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00530R000400730009-4
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 5
• Document Creation Date: December 22, 2016
• Document Release Date: August 27, 2012
• Sequence Number: 9
• Publication Date: May 1, 1988
• Content Type: MISC

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Declassified and Approved For Release 2012/08/27: CIA-RDP90-005301k00046e30-009:4 _
Employee Benefits in State
and Local Governments, 1987
U.S. Department of Labor
Ann McLaughlin, Secretary
Bureau of Labor Statistics
Janet L. Norwood, Commissioner
May 1988
Bulletin 2309
For sale by the Superintendent of Documents, U.S. Government Printing Office, Washington, D.C. 20402
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Chapter 8. Plan Administration
In addition to the data on individual benefit plans, the
survey examined how insurance and retirement benefits were
administered and whether benefits were offered independently
or as part of a flexible benefits program. The survey also
looked at how benefits, including paid leave, were provided
to police and firefighters.
Plan sponsor (tables 79-80)
Although employees of State, rather than local, governments
constituted about one-quarter of the surveyed work force, the
proportion of workers in State-administered plans was higher.
In many instances, local government employees participated
in statewide insurance or retirement plans. Plan sponsorship
varied slightly by occupational group, but significantly from
benefit to benefit. Two-thirds of health and life insurance
participants were in plans sponsored by a local government;
police and firefighters were the most likely group to be in
a local government plan. Sickness and accident and long-term
disability insurance plans were closely split between State and
local sponsorship; 57 percent of sickness and accident
insurance participants were in State-sponsored plans, while
52 percent of long-term disability insurance participants were
in local plans.
State sponsorship of benefit plans was most noticeable in
retirement benefits. Eighty-five percent of participants in
defined benefit pension plans were covered by State-sponsored
plans; such plans were most prevalent for teachers and least
prevalent for police and firefighters. It was not uncommon
for local governments to provide their own insurance benefits
but to contribute to a State pension plan. Three-fifths of money
purchase pension plan participants were covered by State
plans. Once again, teachers were the most likely to participate
in State plans, while police and firefighters were the least
likely.
Data on the incidence of certain benefits for police and
firefighters were further examined to determine whether the
same benefit plans were offered to both occupations. As table
80 shows, about half of these employees were in governments
where the same plans covered both police and firefighters.
(Many protective service workers, however, were in
governments where either police or firefighters, but not both,
were employed. When only one occupation was employed,
it was usually police officers.) In governments employing both,
police and firefighters were likely to have different sick leave,
vacation, and pension plans, while insurance benefits were
generally the same for both occupations. Firefighters often
have unusual work schedules, which necessitate unique paid
leave plans. Differences in defined benefit pension plans
reflect, in part, the availability of State plans for police and
local plans for firefighters.
Flexible benefits plans and reimbursement accounts
(table 81)
Traditionally, employers have offered their workers
benefit plans in a number of areas, such as health insurance,
life insurance, and retirement. Employees may have a choice
between one or more plans in a benefit area, for example,
between a commercial health insurance plan and a health
maintenance organization, but benefits in each area are
offered separately. In recent years, however, new approaches
to offering benefits have attracted considerable attention. BLS
investigated two new arrangements?flexible benefits plans
and reimbursement accounts.
78
Nine percent of the employees in State and local
governments were offered flexible benefits plans,
reimbursement accounts, or both. These plans applied to 11
percent of the teachers, 8 percent of the regular
employees,and 4 percent of the olice and fir
-
cxi. e ene its p ans, also known as cafeteria plans,
covered 5 percent of all workers. These arrangements allow
employees to choose between two or more types of benefits.21
The most common choices offered were health, life, long-
term disability, and sickness and accident insurance; prepaid
legal services; and the option of receiving cash instead of
benefits. In addition, plans commonly allowed employees
to make pretax retirement savings through salary reduction
plans. Less common choices were added sick leave and
vacation days, educational assistance, child care expenses,
and adoption assistance. Pensions are usually fixed benefits
and not part of a flexible benefits program.
Five percent of all workers were eligible for reimbursement
accounts. These accounts, also called flexible spending
accounts, provide employer funds, employee pretax money,
or both, to be used for expenses not included in a benefits
package. Typical expenses that may be reimbursed through
the account include health care coinsurance, deductibles, and
" For this survey, a plan had to allow choices among two or more types
of benefits to be classified as a flexible benefits plan. Thus, plans that
permitted a selection in only one benefit area (for example, a choice among
several health insurance options or plans) were not classified as flexible
benefits plans.
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other out-of-pocket health expenses; insurance premiums;
and child care costs. Reimbursement accounts may be part
of a flexible benefits plan or they may stand alone.
A large majority of employees participating in flexible
benefits plans or reimbursement accounts were required to
contribute toward the cost of their benefits, or were allowed
to contribute to obtain additional benefits. Most of these
79
contributions were in the form of a salary reduction
arrangement.28
Individual benefit plans offered through a flexible benefits
plan were analyzed and included in the tabulations for specific
benefit areas in this bulletin.
28 See footnote 13.
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Table 79. Plan administration: Percent of full-time participants in selected benefits by type of sponsor, State and local
7
Employee benefit program
Health insurance
Life insurance
Sickness and
accident insur-
ance
Long-term disabil-
ity insurance
Defined benefit
pension
Money purchase
pension
All participants
Total
100
100
100
100
100
100
State sponsored
33
35
57
48
85
60
Local government sponsored
67
65
43
52
15
40
Regular participants
Total
100
100
100
100
100
100
State sponsored
39
41
58
51
83
51
Local government sponsored
61
59
42
49
17
49
Teachers
Total
100
100
(')
100
100
100
State sponsored
24
27
(')
46
95
92
Local government sponsored
76
73
(')
54
5
8
Police and firefighters
Total
100
100
100
100
100
100
State sponsored
13
16
43
22
62
41
Local government sponsored
87
84
57
78
38
59
Data were insufficient for publication.
Table 80. Summary: Percent of full-time police and
firefighters by coverage of employee benefit programs,
State and local governments, 1987
Employee benefit program
All par-
ticipants
Paid holidays
93
Paid vacations
100
Paid sick leave
97
Sickness and accident Insurance
14
Long-term disability insurance
18
Health insurance
96
Life insurance
91
Defined benefit pension
93
Defined contribution plan
13
In governmental u
plans covening
nits with
Both po-
lice and
firefight-
ers
Police
only
Firefight-
ers only
45 39 9
40 45 14
45 40 12
4 9 1
9 8 1
53 36 7
53 31 7
43 39 11
3 7 2
NOTE: Because of rounding, sums of individual items may not equal to-
tals.
80
Table 81. Flexible benefits plans and reimbursement
accounts:' Percent of full-time employees eligible, State and
local governments, 1987
Coverage
All ern_
ployees
Regular
employ-
ees
Teach-
erS
Police
and fire-
fighters
Total
100
100
100
100
Eligible for flexible benefits and/or
reimbursement accounts
9
8
11
4
Flexible benefits
5
4
8
2
With reimbursement accounts
1
1
2
(2)
Reimbursement accounts
5
4
5
3
Freestanding reimbursement
accounts
3
3
3
3
Not eligible for flexible benefits or
reimbursement accounts
91
92
89
96
Flexible benefits plans, also known as flexible compensation and
cafeteria plans, allow employees to choose between two or more benefits
or benefit options, including cash, In determining their individual benefit
packages. Reimbursement (flexible spending) accounts, which are used
to finance benefits or expenses unpaid by insurance or benefit plans, may
be part of a flexible benefits program or stand alone (freestanding ac-
counts). These accounts may be financed by the employer, employee, or
both. The employee contribution Is usually made through a salary reduc-
tion arrangement.
2 Less than 0.5 percent.
NOTE: Sums of Individual items may not equal totals because some
employees were eligible for both flexible benefits plans and reimbursement
accounts.
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