Payroll. Your employer is considering adding a group term life insurance plan to the employee benefit...

Payroll. Your employer is considering adding a group term life insurance plan to the employee benefit package. The premium cost would be fully paid by the organization. Explain how this will impact: 1. the employees' net pay, 2. thew employer's payroll costs

Expert Solution

1)

The premium is being paid by the employer so it will increase the gross pay of the employee as the employee will receive the benefits. However, since the employee will not receive any increment in his cash payment, the pay will remain the same.

2)

The amount of insurance premium will be added to employer’s payroll cost and therefore, total payroll cost will increase for the employer.

jeff jeffy answered 2 years ago

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