Glossary of Employee Benefits & Salary Terms

Labor laws protect worker’s rights. But if you don’t even understand employee benefits terms how will you defend those worker’s rights? Here you will find a glossary for the most common employee benefits. Read on and get knowledgeable.

provided by: 

at-will employment - An employment relationship in which either the employer or the employee may terminate the employment at any time for any reason.

benefits- "Benefits" are job-related "perks," such as health, dental, vision, life, and disability insurance - often with the insurance premiums paid partly or entirely by the employer - as well as pension and retirement benefits. best interests of child The legal standard a judge applies in deciding issues of adoption, custody, visitation rights or other matters affecting a child.

deduction- A portion of an employee's paycheck that is "withheld" or "held back" by an employer. "Normal" deductions include payments for federal and state taxes, health insurance premiums, and union dues.

defined benefit plan- A pension plan in which the benefit to the retiree is some portion of the salary paid during the employment. For example, a plan that provides 50% of the average of the three highest earning years is a defined benefit plan. Compare "Defined Contribution Plan."

defined contribution plan- A pension plan in which the employee and employer contribute to a plan in prescribed amounts, but whose benefits to the retiree will depend upon how much the plan earns. For example, a plan in which the employee and employer each contribute 5% of the employee's wages, but which has no obligation to provide any specific amount on retirement, is a Defined Contribution Plan. Compare "Defined Benefit Plan."

ERISA- Abbreviation of the Employee Retirement Income Security Act, the federal law that regulates health and retirement benefits in employment.

garnishment- See wage garnishment

salary- The compensation paid by an employer to an employee for work performed for the employer - usually a set amount of money for a certain period of time. Sometimes known as "wages".

severance package - Money and/or other benefits that an employer may offer to a terminated employee to temporarily offset the employee's job loss. Also known as a "separation package".

Social Security Benefits- Compensation from the federal government for retirement, death, or disability. It is exempt property in bankruptcy.

summary plan description- A written summary, usually in pamphlet form, of the terms and conditions of an employee benefit plan, such as a health benefit or retirement benefit plan.

take home pay- The amount of one's paycheck -after certain required deductions (such as taxes) are taken out of the "gross" pay.

time rule- A formula for determining the portion of an employee's pension that is community property, based upon the number of years of work divided by the number of years married. For example, if a person earned a pension after working 20 years but was married for only 10 of those years, the community interest in the pension is 10/20 - or 50%. The other 50% is the separate property of the employed spouse.

unemployment compensation benefits - Compensation from the government to a worker who has lost his or her job. These benefits are exempt property in bankruptcy.

unemployment insurance benefits - Payments made by a state agency to workers who lose their jobs through no fault of their own.

wages - The compensation paid by an employer to an employee for work performed. Sometimes known as "salary."

For more on employee benefits after employment, COBRA, unemployment insurance and severence benefits visit GotTrouble.com

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