By NextBestFitEnforce maintenance of compensation
Years 1–4 (requirement lasts 3 years after each worker's wave) · DOL Wage & Hour Division; employers; unionsDiscuss this step
Pros & cons of this step
Pros
- +Workers get a raise equal to the health benefit they used to receive in-kind.
- +Addresses the union objection that 'we traded wages for these benefits'.
Cons
- −Complex to administer for employers with varied plans and turnover.
- −After 3 years, enforcement ends and pass-through depends on labor markets.
- Mandating compensation conversion vs. letting markets do it: mandates are certain but bureaucratic.
Trade-off behind each cost item
- A new, visible tax replaces premiums and out-of-pocket costs. It is proportional to income or payroll instead of flat per person.
Trade-off behind each system change
- DOL Employee Benefits Security Administration (health plan oversight)A smaller oversight load; new enforcement duty with complex wage calculations.