United Kingdom (UK) Statutory and Private Employee Benefits, 2023 Update

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United Kingdom (UK) Statutory and Private Employee Benefits Overview

The UK has one of the most comprehensive and well-established welfare systems in the world. It is predominantly controlled by the social security system. Welfare benefits in the country are disbursed under various schemes, such as cash benefits, healthcare, education, childcare housing, and personal social services. Cash benefits are classified into three subgroups: national insurance; means-tested; and non-contributory benefits.

The United Kingdom employee benefits report provides in-depth industry analysis, information, and insights of employee benefits, including an overview of the state and compulsory benefits, detailed information about the private benefits, insights on various central institutions responsible for the administration of the different branches of social security and the regulatory framework of the employee benefits in the United Kingdom.

Key Regulations The Employment Rights Act 1996, The Equality Act 2010, The Pensions Act 2014, The Working Time Regulations 1998, The National Minimum Wage Act 1998 and The National Minimum Wage Regulations 2015, The Transfer of Undertakings (Protection Of Employment) Regulations 2006, Pension Schemes Act 2021, Health Protection Act 2022, Social Security (Additional Payments) Act 2022, And Social Security (Special Rules For End Of Life) Act 2022
Key State and Compulsory Benefits Retirement Benefits, Death in Service, Long-Term Disability Benefits, Short-Term Sickness Benefits, Medical Benefits, Workers’ Compensation Insurance, Maternity and Paternity Benefits, and Other Benefits
Key Private Benefits Retirement Benefits, Death Benefits, Medical Benefits, Disability Benefits, Accidental Death and Dismemberment Benefits, and Other Benefits

Employee Benefit Regulations in United Kingdom

The key laws and regulations guiding the employee benefits market in the UK are:

  • The Employment Rights Act 1996
  • The Equality Act 2010
  • The Pensions Act 2014
  • The Working Time Regulations 1998
  • The National Minimum Wage Act 1998 and the National Minimum Wage Regulations 2015
  • The Transfer of Undertakings (Protection of Employment) Regulations 2006
  • The Trade Union and Labor Relations (Consolidation) Act 1992
  • Pension Schemes Act 2021
  • Health Protection Act 2022
  • Social Security (Additional Payments) Act 2022
  • Social Security (Special Rules for End of Life) Act 2022

For more insights on employee benefit regulations in the UK, download a free report sample

United Kingdom Employee Benefits Segmentation by State and Compulsory Benefits

The key state and compulsory benefits offered by employers in the UK are retirement benefits, death in service, long-term disability benefits, short-term sickness benefits, medical benefits, workers’ compensation insurance, maternity and paternity benefits, and other benefits.

Retirement Benefits: The UK pension system comprises of three pillars. The first pillar is the mandatory public pension system, which includes the basic state pension, the state second pension, and the new state pension. The second pillar comprises a mandatory occupational pension scheme. All employers, irrespective of the number of employees, must automatically enroll their employees into a workplace pension scheme. The third pillar comprises voluntary occupational pensions and individual pensions, including personal pensions and individual savings accounts.

Workers’ Compensation Insurance: It comprises voluntary occupational pensions and individual pensions, including personal pensions and individual savings accounts. All employees are covered against accidents at work and occupational diseases. For Industrial Injuries Disablement, benefits are paid for the entire assessment period.

Maternity and Paternity Benefits: Maternity and paternity benefits are regulated by the Social Security Contributions and Benefits Act 1992 and the Social Security Administration Act 1992. These benefits are given in the form of both cash and kind. Benefits in kind are provided to all residents, whereas earnings-related cash benefits such as Statutory Maternity Pay, Statutory Paternity Pay, Statutory Adoption Pay, and Statutory Shared Parental Pay are given to employees. Earnings-related maternity allowances are given to self-employed and employed women who are not entitled to Statutory Maternity Pay.

To know more about state and compulsory employee benefits in the UK, download a free report sample

United Kingdom Employee Benefits Segmentation by Private Benefits

The key private benefits offered by the employers of United Kingdom are retirement benefits, death benefits, medical benefits, disability benefits, accidental death and dismemberment benefits, and other benefits.

Death Benefits: In the UK, employers provide death benefits in addition to statutory benefits to their employees through group life insurance plans. All full-time, as well as part-time employees of the company, are eligible. Generally, the minimum age is 16 years and the maximum age for which the plan can be extended is 75 years. The minimum membership limit is two employees.

Medical Benefits: Employers in the UK provide medical benefits to their employees by subscribing to group medical insurance plans. Additionally, employers are increasingly providing health and employee assistance programs to support their employees.

Disability Benefits: In the UK, employers provide long-term disability benefits to their employees by subscribing to income protection insurance plans. Group income protection plans provide monthly income to compensate an employee for loss of earnings because of the incapacity to work caused due by sickness or injury.

To know more about private employee benefits in the UK, download a free report sample

Scope

This report provides a detailed analysis of employee benefits in the United Kingdom –

  • It offers a detailed analysis of the key government-sponsored employee benefits, along with private benefits.
  • It covers an exhaustive list of employee benefits, including retirement benefits, death in service, long-term disability benefits, medical benefits, workmen’s compensation insurance, maternity and paternity benefits, family benefits, unemployment benefits, Long-term care benefits, leaves and holidays and private benefits.
  • It highlights the economic and regulatory situations relating to employee benefits in the United Kingdom.

Key Highlights

• The HM Revenue & Customs, Department for Business, Energy, and Industrial Strategy (BEIS), and National Health Services (NHS) organizations are responsible for the functioning of the overall social security system.

• A person’s national insurance contribution is determined based on their income.

• An insured person who is unemployed or unable to work and whose benefits have been exhausted is entitled to credited contribution.

• In the UK, employers provide voluntary retirement benefits to their employees through occupational pension schemes, master trust and automatic enrollment.

Reasons to Buy

  • Make strategic decisions using in-depth information related to employee benefits in the country.
  • Assess employee benefits of the market, including state and compulsory benefits and private benefits.
  • Gain insights into the key employee benefit schemes offered by private employers in the country.
  • Gain insights into key organizations governing employee benefits market, and their impact on companies.

Table of Contents

  • 1. Executive Summary
  • 2. Introduction
  • 2.1 What is this Report about?
  • 2.2 Definitions
  • 3. Country Statistics
  • 4. Overview of Employee Benefits in United Kingdom
  • 5. Regulations
  • 6. State and Compulsory Benefits
  • 6.1 Retirement Benefits
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.2 Death in Service
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.3 Long-Term Disability Benefits
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.4 Short-Term Sickness Benefits
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.5 Medical Benefits
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.6 Workers’ Compensation Insurance
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.7 Maternity and Paternity Benefits
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.8 Other Benefits
  • – Family Benefits
  • – Long-Term Care Benefits
  • – Unemployment Benefits
  • – Leaves and Holidays

  • 7. Private Benefits
  • 7.1 Retirement Benefits
  • 7.2 Death Benefits
  • 7.3 Medical Benefits
  • 7.4 Disability Benefits
  • 7.5 Accidental Death and Dismemberment Benefits
  • 7.6 Other Benefits
  • About GlobalData
  • Contact Us

Table

Table 1: Insurance Industry Definitions

Table 2: The UK – Country Statistics, 2021

Table 3: The UK – National Insurance (NI) Contributions Thresholds

Table 4: The UK – National Minimum Wage April 2023

Table 5: The UK – Class 1 NI Contribution Rates for Employee 2022–23

Table 6: The UK – NI Contributions for Employers 2022–23

Table 7: The UK – Weekly Statutory Sick Pay Rates for 2022–23

Table 8: The UK – Industrial Injuries Disability Benefits Level

Table 9: The UK – Payment of Constant Attendance Allowance

Table 10: The UK – Statutory Maternity, Paternity, and Adoption Pay, 2022–23

Table 11: The UK – Working Tax Credit, Eligibility

Table 12: The UK – Additional Benefits

Table 13: The UK – Contribution-Based Jobseeker’s Allowance

Table 14: The UK – Income-Based Jobseeker’s Allowance

Table 15: The UK – Fixed National and Public Holidays 2023

Table 16: The UK – Number of DB Schemes 2022

Table 17: The UK – Mileage Allowance Payments

Figures

List of Figures

Figure 1: The United Kingdom – Main Institutions of Social Security System

Frequently asked questions

  • What are the key regulations guiding employee benefits in the United Kingdom?

    The key regulations guiding employee benefits in the UK are the Employment Rights Act 1996, the Equality Act 2010, the Pensions Act 2014, the Working Time Regulations 1998, the National Minimum Wage Act 1998 and the National Minimum Wage Regulations 2015, the Transfer of Undertakings (Protection of Employment) Regulations 2006, Pension Schemes Act 2021, Health Protection Act 2022, Social Security (Additional Payments) Act 2022, and Social Security (Special Rules for End of Life) Act 2022 among others.

  • What are the key state and compulsory benefits for employees in the United Kingdom?

    The state and compulsory benefits for employees in the UK are retirement benefits, death in service, long-term disability benefits, short-term sickness benefits, medical benefits, workers’ compensation insurance, maternity and paternity benefits, and other benefits.

  • What are the key private benefits for employees in the United Kingdom?

    The private benefits for employees in the UK are retirement benefits, death benefits, medical benefits, disability benefits, and accidental death dismemberment benefits, and other benefits.

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