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Source link: http://archive.mises.org/16876/fringe-benefits-a-threat-to-progress/

Fringe Benefits: A Threat to Progress

May 10, 2011 by

Ostensibly their purpose is to reduce turnover of labor and stabilize employment. But they tend to freeze a worker in his job. FULL ARTICLE by F.A. Harper

{ 4 comments }

zaq.hack May 10, 2011 at 10:00 am

Having worked for a variety of employers over the years, I have noticed a trend about my “benefits.” If I work for a company whose benefits I can more expediently get elsewhere, those “benefits” tend to be compulsory. However, when I work for a company with great insurance or other benefits to which I would LIKE to participate, those plans are optional.

The worst was a company I worked for back in the 1990′s who only allowed direct deposit if you banked at a certain bank. (The owner of the company was a board member of said bank, you see.) Worst. Bank. Ever. That adventure cost me hundreds of dollars before I started counting up my time on the phone and standing in line at one of their three offices …

Eric May 10, 2011 at 12:39 pm

The example in the article does not mention that benefits, such as insurance and pension payments have government circumvention advantages. This is the main reason these were begun, as a way to avoid the wage and price controls during WWII.

Today, the price and wage controls are gone, but the tax advantages have grown, and naturally, so has the strings attached. If you were given the cost of providing these benefits directly, your tax burden would increase substantially.

zaq.hack May 10, 2011 at 1:26 pm

It depends. You can still deduct most of them from your taxes if you itemize. I had my own insurance for many years (an HSA) until going to work for a company that had an even better plan about 2 years ago. I have not restarted an HSA after leaving that job because of the current healthcare governmess.

mushindo May 11, 2011 at 3:55 am

Eric makes a valid point. I for one, for most of my career, have preferred to sacrifice some cash earnings for other benefits, such as a company car, housing allowance, entertainment, etc. At least until the predatory state started to tax these things punitively. ON the first-mentioned, I find a lot of value in the convenience of having a car which is completely insured, fuelled and maintained at company expense, but I get to drive it at my leisure.

of course, my company has come into the light, in that these days, it offers a total cash package witrh various optional benefits which may be taken in lieu of a portion of that cash, and then leaves it to the employee to choose how to structure it.; SOme value the cash more than the benefit, others don’t.

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