Answer to Question 1
Answer: Tax incentives encourage companies to offer retirement programs. Some of the Employee Retirement Income Security Act of 1974 (ERISA) Title I and Title II provisions set the minimum standards required to qualify pension plans for favorable tax treatment. Failure to meet any of the minimum standard provisions disqualifies pension plans for favorable tax treatment. Pension plans that meet these minimum standards are known as qualified plans. Nonqualified plans refer to pension plans that do not meet at least one of the minimum standard provisions; typically, highly paid employees benefit from participation in nonqualified plans.
Answer to Question 2
Answer: Integrated paid time off policies or paid time off banks combine holiday, vacation, sick leave, and personal leave policies into a single paid time off policy. Such policies do not distinguish among reasons for absence. The idea is to provide individuals the freedom to schedule time off without justifying the reasons. This freedom should presumably reduce unscheduled absences that can be disruptive to the workplace because these policies require advance notice except in case of illness. Integrated paid time off policies have become an increasingly popular alternative to separate holiday, vacation, sick leave, and personal leave plans because they are more effective in controlling unscheduled absenteeism. Integrated policies also relieve the administrative burden of managing separate plans and the necessity to process medical certifications in the case of sick leave policies.
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