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Money for Life work in partnership with the Money Advice Service, an independent organisation set up by government. Money AdviceService provides free, unbiased money guidance across the UK to help people make the most of their money.  If you have a question or need help, you can chat to them here.

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What’s the deal with workplace benefits?

By Katie Fosberry

Photo credit: Erda Estremera 

Have you noticed that job adverts will often quote “plus benefits” next to the advertised salary?  Perhaps you’re employed and you’ve heard you’re entitled to company benefits or a “benefits package”. 

If you’re feeling confused about what these benefits are – a workplace benefit is simply something a company is offering an employee in addition to their pay.  

Some benefits MUST be offered to you by your employer. Here we take a look at the most common benefits.

 

Did you know you must be given paid annual leave?   

For a full-time employee (working five days a week) the minimum level of holiday is 28 days.  A lot of workplaces will make employees take bank holidays off, and this is included in the 28 days figure.  As there are eight bank holidays in England for 2020, this typically means that an employee has a minimum of 20 days to use take as leave when they choose.

Of course, a company may offer a higher level of annual leave.  Many companies will award additional holidays days to their employees as a reward for long service.  

If you work part-time or irregular hours, you can calculate your holiday entitlement here.

 

What about pensions?

You should come across pensions a lot throughout your working life.  It might not seem like the most exciting benefit, but it may just be the most valuable.  A pension is essentially a pot of money you are saving away for your future.  

In most cases, you must be offered membership to a pension by your employer.  This will also come with a pension contribution of 8% of your salary.

Part of this contribution is 4% of your pay taken directly from your salary with 1% tax relief granted by the Government.  The rest of the contribution is paid by your employer.

This employer contribution works out as an additional 3% of your salary, and is money you would not get if you weren’t enrolled in your pension scheme.  

To find out more about pension plans, The Money Advice Service is a useful resource of information See here.

 

What if I become ill or pregnant?

Sometimes it will be necessary to take time off work.  You may be sick, or you may have just had a child.    

The law does not entitle you to be paid at your full rate when you are sick.  The minimum level of sick pay is known as Statutory Sick Pay (SSP).  This is £95.85 a week and paid by your employer for up to 28 weeks, but only from your fourth day off sick.  More information can be found here.

An employer may offer an enhanced level of sick pay, but this is dependent on your contract.  It is important to understand what you will be entitled to if you do become ill.  

If you become pregnant you may be entitled to paid leave from your employer, known as Statutory Maternity Pay (SMP).

This is dependent on numerous factors. Importantly, you need to have been employed for at least 26 weeks before the 15th week of pregnancy (known as the qualifying week). 

SMP is 90% of your earnings for the first six weeks of maternity leave, and then reduces to £151.20 per week for the next 33 week. 

Like sick pay, an employer may choose to give employees more money than the minimum SMP.  

There are other forms of paid parental leave available, and you can find more information here.

 

What about private health care and a company car?

Sadly, your boss doesn’t have to give you a fancy car or a dental plan.

Although these benefits can be nice to have, they are less common in UK workplaces.  The above article explains what you are likely to come across whilst working, and it is important to understand what you are entitled to.



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Money for Life work in partnership with the Money Advice Service, an independent organisation set up by government. Money AdviceService provides free, unbiased money guidance across the UK to help people make the most of their money.  If you have a question or need help, you can chat to them here.

Launch Chat

Chat to the Money Advice Service
Monday to Friday, 8am to 6pm
Saturday, 9am to 1pm.