Pensions Industry - The Employment Package
The Employment Package
The main element of an employee's benefits package comes in the form of an agreed rate of salary (which can include variable elements such as bonuses). However an employer often offers other benefits, including some form of retirement provision and sometimes benefits in kind.
The amount of salary an employee will receive is determined by the contract of employment, as amended from time to time. European law defines pay as salary, wages or other consideration, whether in cash or benefits in kind which the worker receives directly or indirectly in respect of his employment with an employer. When comparing remuneration, benefits in kind, including retirement provision, must be considered. Any other benefit which is a payment of money or capable of being turned into money is also subject to tax. Remuneration from employment is subject to tax. Certain other payments such as statutory maternity pay and statutory sick pay are also subject to tax. The definition is very broad and the list of what can be taxed is very long.
National Insurance (NI) contributions are also payable on remuneration. Employees do not have to pay NI on certain benefits in kind, while employers have to pay on almost all benefits, for example company cars.
1. References
This section of study, The Employment Package can be found in the relevant pages of the Retirement Provision Certificate Study Manual 2023
2.Think about it
Think about the organisation for which you currently work, or a previous employer. What types of benefits in kind do they offer?
You will be surprised at the similarities - but more so in some cases at the breadth of differences.
3. Fact Finding
Statutory Sick Pay
Let's find out exactly what Statutory Sick Pay (SSP) entails, so that when you consider disability benefits you are aware of the basic entitlements.
STEP 1 - Visit the GOV.UK website by clicking the logo here:
STEP 2 - Follow the menu link for 'Working, jobs & pensions' to view the 'holidays, time off, sick leave...'
STEP 3 - Now click on 'Statutory Sick Pay', then follow the links contained in the text for further information to try and answer the following questions:
- How long is SSP paid for?
- How much is SSP?
- Who pays SSP?
4. Test
You can now check your knowledge by a short test. Once completed then check your answers against those given.
