Pension Administration (Introduction and Key Concepts, Glossary and Updates)
Introduction and Key Concepts
Benefits>>Pension Admin
Overview of the Pension Administration Module
The purpose of the Pension Administration Module is to assist an organisation in maintaining the pension records of its staff by collecting the pension contributions from the HRplus Payroll, apply the recommended interest distribution from the organisation's actuaries and ultimately generate the pension statements due to your employees. Among the features of the Pension Administration module include the ability to:
capture, manage and manipulate the data associated with members of a pension plan.
keep track of the pension status of a pension plan member from the time he/she joins the plan up until the time of final benefits payments.
perform end of year interest calculations on contributions (normal (ordinary) and additional voluntary) as well as on transfer values.
interface with HRplus Payroll to retrieve the contributions (normal (ordinary) and additional voluntary) that were paid during the year by a pension plan member.
print a number of reports including but not limited to a pension plan member’s contributions and interest earned, and the pension status history of the member.
A Guide to Using the Pension Module
The Pension Administration Guide provides a comprehensive overview of the administration of employee pension benefits within the HRplus Pension Module.
Step 1 | Pension Setup | |
Benefits>>Pension Admin>>Pension Setup>>Pension Status Benefits>>Pension Admin>>Pension Setup>>Pension Status Sequence Benefits>>Pension Admin>>Pension Setup>>Retirement Type Benefits>>Pension Admin>>Pension Setup>>Interest Rate Codes Benefits>>Pension Admin>>Pension Setup>>Pension Type Plans Benefits>>Pension Admin>>Pension Setup>>Transfer Value - Employer Benefits>>Pension Admin>>Pension Setup>>Pension Constants | ||
Pension Status |
How do I set up Pension Status? | |
Pension Status Sequence |
How do I set up Pension Status Sequence? | |
Retirement Type |
How do I set up Retirement Types? | |
Interest Rate Codes |
How do I set up Interest Rate Codes? | |
Pension Type Plans |
How do I add Pension Plans? | |
Transfer Values - Employer |
How do I set up Transfer Values - Employer? | |
Pension Constants |
How do I set up Pension Constants? | |
Step 2 | Pension Administration | |
Benefits>>Pension Admin>>Administration>>Pension Interest Rates Benefits>>Benefits>>Benefits Setup>>Benefit Plan Types>>[Select Benefit Type Code]>>[+]>>Enrolled Employees Benefits>>Pension Admin>>Administration>>Plan Members | ||
Pension Interest Rates |
How do I set up Pension Interest Rates? | |
Enroll Employees in Pension Plan |
| |
How do I enroll employees in the Pension Plan (via the Benefits module)? | ||
Pension Plan Members |
How do I Add Pension Plan members? | |
Pension History and Personal Data |
How do I view employee's Pension History and Personal Data? | |
Pension Data |
How do I view employee's Pension Data? | |
Step 3 | Pension Calculations | |
Benefits>>Pension Admin>>Administration>>Calculations Benefits>>Pension Admin>>Administration>>Calculations>>Transfer Value Interest Calculations Benefits>>Pension Admin>>Administration>>Calculations>>Ordinary Member Contributions Interest Calculations Benefits>>Pension Admin>>Administration>>Calculations>>Additional Voluntary Contributions Interest Calculations Benefits>>Pension Admin>>Administration>>Calculations>>Pensions in Payment Increases Calculations Benefits>>Pension Admin>>Administration>>Calculations>>Deferred Pension Increases | ||
Calculations | ||
Pension Contributions Interest |
How do I calculate interest on Pension Contributions? | |
Step 4 | Print Pension Statements | |
Benefits>>Pension Admin>>Reports>>Pension Reports>>Pension Statements | ||
Print Employees' Pension Statements |
How do I print employees' Pension Statements? | |
Glossary of Pension Terms
Active Member: An individual who is currently contributing to a pension plan or who has contributions being made on their behalf, and accruing benefits.
Additional Voluntary Contributions (AVCs): Extra payments made by a member to increase their pension benefits on retirement, over and above the standard contributions. This contribution is in addition to the ordinary contribution.
Annuity: A financial product that provides a series of payments made at regular intervals, often for the lifetime of the individual, purchased with a lump sum or over time.
Contribution: A payment made to a pension plan by a plan member.
Death in Deferment: The event of a deferred member passing away before starting to receive pension benefits.
Death in Deferment: The event of a deferred member passing away before starting to receive pension benefits.
Death in Service: The event of an active member passing away while still employed and contributing to the pension plan.
Deferred Member: An individual who is no longer contributing to the pension scheme OR who draws the pension benefits later than his/her normal retirement age.
Deferred Pension: The pension benefits that have been earned by a member but are not yet payable because the member has not reached the normal retirement age and has left the scheme before retirement or the pension is drawn later than the member’s normal retirement date.
Early Retirement: The option for a member to begin receiving pension benefits before the normal retirement age, usually with a reduction in benefits.
Guaranteed Pension: A retirement plan where an employer or pension provider promises a fixed, predictable monthly benefit for life. The benefit amount is based on factors like salary and years of service. The employer assumes the investment risk and ensures sufficient funding for the promised benefits. Guaranteed pensions offer financial security and predictability for retirees but can be costly for employers.
Ill Health Retirement: Retirement that occurs before the normal retirement age due to medical reasons.
Interest Rates: The rates at which interest is calculated on the contributions made to a pension plan or on the benefits accrued.
Late Retirement: The option to retire after the normal retirement age, often resulting in an increase in pension benefits.
Leaver with Contribution Refund: A member who has left the pension scheme and opted to receive a refund of their contributions, usually available if they have not met the vesting period requirements.
Leaver with Transfer Value: A member who has left the pension scheme and transferred the value of their accrued benefits to another pension scheme.
Lump Sum Payment: A one-time payment made to a member, typically upon retirement, in lieu of or in addition to periodic pension payments.
Normal Retirement Age: The age at which a member is eligible to receive full pension benefits, as defined by the pension plan.
Ordinary Contributions: Regular, mandatory payments made by both the employee and employer into the pension plan according to the plan rules.
Pension Status: The current state or condition of a member’s pension, such as active, deferred, or retired.
Pension Status Sequence: The progression of a member’s status through various stages such as active, deferred, and retired.
Pension Type Plans: Different categories of pension schemes, such as defined benefit plans, defined contribution plans, and hybrid plans.
Retirement Type: The classification of retirement based on circumstances, such as early retirement, normal retirement, or ill-health retirement.
Spouse Pension: A pension benefit paid to the surviving spouse of a member after the member's death.
Transfer Value: The amount of money representing the value of a member’s pension rights that can be transferred to another pension scheme. This amount is calculated by the actuaries of the pension plan administrator. They will calculate the amount of money (transfer value), that would be needed to provide a pension based on current earnings.
Transfer Value from Employer: The value of pension benefits that an employer transfers to another pension scheme on behalf of a member.
V
Vested: The status of having earned the right to receive full benefits from a pension plan, even if the member leaves the employer before retirement. This typically occurs after a specified period of service or contributions.
Pension Administration Updates: What's New?
This article provides a summary of recent updates to the HRplus Pension Administration module, focusing on key enhancements. These updates include new features, fixes and improvements designed to improve both user experience and the effectiveness of the module.
September 1st – October 8th, 2023
1. Pension Statements: Added new features for generating and managing pension statements, allowing employees to access detailed pension information.
September 25th – October 17th, 2020
1. Pension Audits: Introduced audit capabilities to track pension contributions and ensure compliance with pension administration regulations.
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