Definition - What does Employee Contributions mean?
Employee contributions refer to the aggregate amount of money paid by an employee to contribute to a deferred benefit, such as an annuity or pension.
Insuranceopedia explains Employee Contributions
Employee contributions are required when an employer takes out an employee health insurance and a 401(k) retirement savings plan. Under the Affordable Care Act, employee health insurance is mandatory; whereas, a 401(k) plan is not mandatory for any company.
Typically, employee contributions are just a fraction of the entire cost of an insurance plan, and they are also subject to the limits imposed by the federal government. In 2014, the national average cost of a single employee’s contribution to health insurance in the United States was $1,080 per year, while family coverage averaged $4,824 per year.
- Employee Benefit Insurance Plan
- Employee Health Benefits
- Health Maintenance Organization (HMO)
- Employee Death Benefits
- Employee Retirement Income Security Act of 1974 (ERISA)
- Key Employee Insurance
- Employee Contributions
- Flexible Benefit Plan
- Sole Proprietor Life and Health Insurance
- Death Benefit Only Life Insurance Plan (DBO)