Short-term employee benefits

Short-term employee benefits include:

  • Absences. Compensated absences where payment is settled within 12 months of when employees render related services, for example, vacation, short-term disability, jury service, and military service.
  • Base pay. Wages and social security contributions.
  • Nonmonetary benefits. Medical care, housing, cars, and various subsidies for other goods or services.
  • Performance pay. Profit sharing and bonuses payable within 12 months of when employees render related services.

The entitlement to compensated absences can be accumulating or non-accumulating. An accumulating compensated absence is carried forward and can be used in future periods. An accumulating compensated absence can be vesting, so that employees are entitled to a cash payment for unused entitlement when they leave the entity. If an accumulating compensated absence is nonvesting, then employees do not receive such a cash payment when they leave the entity.

Related Courses

Human Resources Education Bundle 
Human Resources Guidebook 
Payroll Management