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Employee benefits are non-wage compensations provided to employees in addition to their normal wages or salaries. The creation and purpose of employee benefits is to increase the economic security of employees. Normally, employer provided benefits are tax-deductible to the employer and non-taxable to the employee. Exceptions to this rule include executive benefits, which usually exceed the IRS maximum allowed, and therefore, the executive would have to pay income tax for the excess amount. Types of employee benefits include, but are not limited to, the following:
- Group Insurance (i.e. health, dental and/or life insurance)
- Income Protection
- Retirement Benefits
- Tuition reimbursement
- Sick leave
- Vacation
- Social Security
- Worker's Compensation
In addition, certain employee benefits, such as accident and health plans, may be excluded from the employee's gross income and, therefore, are not subject to federal taxation laws. Employee benefits are also thought of as the costs of keeping employees other than salary. These benefit rates are typically calculated using fixed percentages that vary depending on the employee's classification and often change from year to year.
Unfortunately, business owners and managers looking to enhance their company's bottom line have been known to take irresponsible action in regards to their employee's hard-earned benefits. If you feel that your employer is not providing proper benefits packages to you and your fellow employees, you are encouraged to seek legal aid as soon as possible. Aggressive attorneys with an impressive track record in employee benefits claims litigation will help you begin the process by which you can bring those who would jeopardize your financial future to justice.
