Payroll & Taxation Unit 1

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Questions and Answers

What is the primary purpose of the Retrenchment and Severance Benefits Act No. 32 of 1985?

To prohibit redundancy in the workplace

To outline the procedures for redundancy and severance payments (correct)

To provide job security for all workers

To determine job classifications within a business

Which of the following scenarios does NOT qualify as a redundancy situation?

A worker's job functions being taken over by another person (correct)

A fundamental alteration of job classifications

A change in ownership of the business

Management restructuring the business

Who needs to be notified in writing if an employer proposes to retrench five or more workers?

The remaining workers only

The Recognized Majority Union and the Minister of Labour only

The affected workers, the Recognized Majority Union, and the Minister of Labour (correct)

The industry association of the business

What is the minimum notice period required for retrenchment of five or more workers?

45 days Signup and view all the answers

Which category of workers is excluded from coverage under the RSBA?

Casual workers employed on an irregular basis Signup and view all the answers

In which situation can redundancy arise?

When an employer fundamentally alters job classifications Signup and view all the answers

What is defined as 'Retrenchment' under the RSBA?

The termination of employment initiated by the employer due to redundancy Signup and view all the answers

Which of these is NOT a requirement for a worker to qualify for severance benefits under the RSBA?

Serving a probationary period Signup and view all the answers

What does LIFO stand for in the context of employee retrenchment?

Last In, First Out Signup and view all the answers

Under the ATBE considerations, which factor is NOT typically considered for retrenchment decisions?

Age of Employment Signup and view all the answers

What potential consequence might exist for a worker who refuses suitable employment offered to them?

Their severance benefits may be withheld. Signup and view all the answers

Which of the following individuals can work in employment according to the Children Act 2012?

A 15-year-old working in a family business Signup and view all the answers

What must employers do regarding records of employees under 18 years?

Keep a register and allow inspections by Labour Inspectors. Signup and view all the answers

According to the obligations imposed on employers, which of the following is required?

To cooperate with Inspectors on information related to underage employees. Signup and view all the answers

Which of the following is true regarding breaches of the legal requirements for employing minors?

Breaches can lead to financial penalties for employers. Signup and view all the answers

What must happen before performance indicators can be considered in retrenchment under ATBE?

Workers must be informed of their shortcomings. Signup and view all the answers

What determines the amount of income tax an employee must pay?

The employee's chargeable income Signup and view all the answers

Which system requires employers to deduct tax directly from employees' wages?

PAYE System Signup and view all the answers

Which of the following is NOT a benefit typically provided by the National Insurance scheme?

Hazard pay Signup and view all the answers

What is the maximum weekly Health Surcharge payment for employed persons earning more than $469.99 monthly?

$8.25 Signup and view all the answers

In the National Insurance payment structure, who typically bears the larger portion of the contribution?

The employer pays two-thirds while the employee pays one-third Signup and view all the answers

What does the Health Surcharge help finance?

Health services provided by the Government Signup and view all the answers

Which of the following deductions is considered non-statutory?

Trade union dues Signup and view all the answers

What does a group health and pension plan provide for employees?

A collective insurance policy Signup and view all the answers

What is the maximum duration of maternity leave that can be extended for medical reasons after the birth of a baby?

12 weeks Signup and view all the answers

What is the payment obligation for the employer during the first 6 weeks of extended maternity leave for medical reasons?

Half-pay Signup and view all the answers

Which of the following is NOT a reason for extending maternity leave?

Financial hardship Signup and view all the answers

What three statutory deductions are mandatory in Trinidad & Tobago?

Income Tax, National Insurance, Health Surcharge Signup and view all the answers

How is chargeable income calculated under the PAYE system?

Gross Salary minus Allowances Signup and view all the answers

If an employee takes maternity leave for non-medical reasons, how long can they postpone their return to work?

4 weeks Signup and view all the answers

Which of the following is considered an allowance that can reduce gross wage for income tax calculation?

Personal allowance Signup and view all the answers

What is the requirement for an employee to be paid during maternity leave?

Must have worked for 12 continuous months Signup and view all the answers

What is the penalty for failing to maintain a register or allowing an Inspector access to it?

Fine of $20,000 and 1 year imprisonment Signup and view all the answers

What is the maximum fine for a parent or guardian who employs a child under the age of 16 years through willful default?

$5,000 Signup and view all the answers

What is the duration of Maternity Leave an employee is entitled to after 12 months of continuous employment?

14 weeks Signup and view all the answers

How much full salary does an employer have to pay if they do not pay the NIS contributions during Maternity Leave?

Full salary for the entire period Signup and view all the answers

When must an employee inform their employer in writing about their pregnancy and Maternity Leave?

At least 8 weeks before the due date Signup and view all the answers

Which of the following is NOT a right of a pregnant employee after 12 months of employment?

Full pay for the entire 14 weeks Signup and view all the answers

What consequence does an employer face for employing a child under the age of 16 years?

A fine and possible imprisonment Signup and view all the answers

What is the record-keeping responsibility of employers regarding Maternity Leave?

Records for 5 years Signup and view all the answers

Study Notes

Retrenchment and Severance Benefits Act

Established under Act No. 32 of 1985 for procedures regarding redundancy and severance payments.
Redundancy defined as surplus labor within a business, while retrenchment is an employer-initiated termination due to redundancy.
Recognized Majority Union is a certified trade union representing workers in a bargaining unit.

Situations Leading to Redundancy/Retrenchment

Arises from business reorganization or restructuring.
Occurs due to changes in job classifications or relocation of operations.
Involves ownership transfer where the new owner does not retain existing staff.

Employees Exempt from RSBA

Workers with less than one year of service.
Those on known probationary periods or casual/seasonal workers, unless employed consistently for specified durations.
Fixed-term employees or those with specific project tasks disclosed on engagement.

Retrenchment Procedures

Employers must notify each affected worker, the Majority Union, and the Minister of Labour when terminating five or more workers.
A 45-day notice period is mandated for major retrenchments.
Last In, First Out (LIFO) policy applies, but performance issues can influence selection for retrenchment.

Severance Benefits

May be withheld if workers refuse suitable comparable employment offers under similar conditions.

Employment of Children Act 2012

Prohibits employment of individuals under 16 years except in family-controlled undertakings.
Employers must maintain a register of employees under 18, providing details for inspection by Labour Inspectors.

Employer's Responsibilities

Not to employ anyone under 16 years.
To maintain records for minors, available for inspection at request.
Cooperate with inspections regarding wages and working conditions of employees under 18.

Breaches and Penalties

Failing to maintain required records can incur a fine of $20,000 and/or imprisonment.
Obstructing an inspector is treated as contempt of court.
Legal repercussions exist for parents enabling employment of children under 16.

Maternity Rights

Employees with 12+ months continuous service are entitled to 14 weeks maternity leave, with pay arrangements detailed.
Entitled to reasonable paid time off for prenatal care.
Guaranteed return to work under favorable conditions and eligibility for promotion during leave.

Maternity Leave

Can start six weeks prior to the due date; specific notification processes to employers are required.

Responsibilities of Employers Regarding Maternity

Must keep employment records for up to five years.
Provide maternity leave regardless of premature or post-term circumstances.
Pay maternity benefits according to tenure.

Extending Maternity Leave

Extension available for medical reasons up to 12 weeks, with varying pay responsibilities.
Non-medical extensions permissible for up to four weeks without pay obligations.

Statutory Deductions

Mandatory deductions include Income Tax, National Insurance, and Health Surcharge.
PAYE system used to calculate income tax based on employee’s chargeable income.

Income Tax and Allowances

Calculated from gross salary after allowances are deducted.
Varies by personal situations; those below set thresholds may not be taxed.

National Insurance System

Contributions shared between employer and employee based on salary, providing various benefits including sickness and maternity.

Health Surcharge

A statutory deduction assisting healthcare financing; defined rates depending on income levels for both employed and non-employed individuals.

Non-Statutory Deductions

Include agreements for group health and pension plans or personal insurance, typically deducted from salary with employee consent.

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Description

Explore the key aspects of the Retrenchment and Severance Benefits Act No. 32 of 1985, which outlines procedures for redundancy situations and severance payments. This quiz covers definitions and provisions related to retrenchment and redundancy, including enhancements through individual contracts and collective agreements.