A statutory deductions clause specifies that any required deductions, such as taxes or social security contributions, will be withheld from payments made under the contract in compliance with applicable laws. This ensures that both parties fulfill their legal obligations for deductions mandated by governmental authorities.
“Severance. Except in situations where the employment of Executive is terminated For Cause, By Death or By Disability (as defined in Section IV below) (a)in the event that, following a Change of Control (as defined in the Company’s Amended and Restated 2014 Omnibus Incentive Plan), the Company terminates the Executive’s employment, the Executive will be entitled to payment by the Company of an amount equal to twelve (12) months of Executive’s then-current Base Salary, less applicable statutory deductions and withholdings and (b) in the event that, prior to a Change of Control, (i) the Company terminates the Executive’s employment before April 4, 2023, then Executive will be entitled to payment by the Company of an amount equal to six (6) months of Executive’s then-current Base Salary, less applicable statutory deductions and withholdings, (ii) the Company terminates the Executive’s employment on or after April 4, 2023 and before October 4, 2024, then Executive will be entitled to payment by the Company of an amount equal to nine (9) months of Executive’s then-current Base Salary, less applicable statutory deductions and withholdings, (iii) the Company terminates the Executive’s employment on or after October 4, 2024, then Executive will be entitled to payment by the Company of an amount equal to (12) twelve months of Executive’s then-current Base Salary, less applicable statutory deductions and withholdings (“Severance”). Such Severance will be paid as salary continuation (and not as a lump sum) over the applicable period and in accordance with the Company’s standard payroll practices. Executive’s eligibility for the foregoing Severance is conditioned on Executive having first signed a release agreement in the form attached as Exhibit A. Additionally, Executive shall not be entitled to any Severance if Executive’s employment is terminated by Executive.”
2.Variable Incentive Bonus The Employee shall be entitled to participate in a variable bonus program, whereby the annual bonus target is set 50% of the Employee's annual gross salary (subject to statutory deductions). The entitlement of the Target bonus will be based on the achievement of qualitative and quantitative objectives, as approved annually by the Board of Directors. The Employee shall not be eligible to receive any bonus if he is terminated from the Company for cause or disciplinary action. 3.Ancillary Benefits The Company shall provide the Employee with a standard car allowance according to local norms (subject to statutory deductions). Reasonable expenses for foreign tax preparation and other expenses as they relate directly to the Employee's engagement with the Company may be submitted for reimbursement. 4.Notice Period and Severance In the event this Agreement is unilaterally terminated by the Company with an ordinary notice of 90 days, a one-time severance payment equal to 12 months of the Employee's annual salary+ target bonus (subject to statutory deductions) will be made to the Employee. This severance payment shall be paid concurrent with and in addition to the final salary payment of the 90 day notice period. The severance payment shall not apply in the event the Employee chooses to resign from his position with the Company, or if the Employee is terminated from the Company for cause or disciplinary action.
Salary: Your basic gross salary will be £350,000 per year (subject to tax and statutory deductions) (the "Salary"). Corporate Incentive Compensation Plan (“CICP”): You are eligible for a bonus for 2021 of up to 40% of your salary, on the successful achievement of company and personal objectives and subject to the CICP plan rules. Any bonus payment will be subject to tax and statutory deductions, will not be pensionable and will be prorated in the first year according to your start date of February 2021. Individual Commission Plan (“ICP”)/Management Business Objectives (“MBOs”): In addition to your Salary, you may be eligible to earn commission/MBOs dependent on your performance against financial targets set by the Company and subject to the ICP plan rules. Your target for 2021 will be £70,000. Any commission payment will be subject to tax and statutory deductions and will not be pensionable.
(ii) Upon such termination for Cause, Executive shall be entitled to receive any Accrued Obligations, which shall be paid to Executive in a lump sum, subject to statutory deductions and withholdings, in cash within ten (10) business days after the date of termination or any earlier time required by applicable law.
1. Salary Increase Based on several criteria, including the Company’s overall financial position as well as your performance in your current role, your annual base salary will be increased 3% to $298,700, effective July 1, 2019. The salary will continue to be paid semi-monthly, in arrears, and less any statutory deductions. 2. Annual Bonus for FY2018-19 Based on overall corporate achievement of key goals as well as your individual contributions, you will receive a one-time bonus of $59,508, as calculated below. This will be paid in the 15 July 2019 payroll period, less statutory deductions. Note that the payout of any such future bonuses will be subject to achievements of corporate and personal goals, as defined by the Executive Team and subject to the financial position of the Company, as determined at the sole discretion of the Board of Directors.
a) The Executive's employment shall immediately terminate upon the Executive' s death or Incapacity, without notice or payment in lieu of notice or any indemnity whatsoever, except: (i) the Basic Payments, payable (less applicable statutory deductions) within five (5) Business Days following the Termination Date; and (ii) payment of any awarded but unpaid performance bonus for the year preceding the year during which the termination of the Executive's employment occurs, payable within fifteen (15) Business Days following the Termination Date, however, in no event before the usual payout date of such bonus, less applicable statutory deductions;
(b) Subject to compliance with Section 409A of the Code, an amount equal to the greater of (i) one hundred percent (100%) of Executive’s target bonus (if any) for the year in which the date of termination occurs, or (ii) a bonus for such year as may be determined by the Committee in its sole discretion. This amount shall be paid in the form of a lump sum, less applicable statutory deductions and withholdings, as soon as practicable after the date of termination, but no later than March 15 of the year immediately following the year in which the date of termination occurs; and (c) For a termination due to Inability to Perform only, then the Company shall pay Executive a severance equal to six (6) months of Executive’s Base Salary at the time of termination. This severance amount shall be paid to Executive in equal regular installments over the six (6) month period pursuant to the Company’s regular payroll periods, less applicable statutory deductions and tax withholdings. The first installment shall be paid to Executive on the first payroll period after the date of termination; and
Accrued Pay and Pay in Lieu of Notice You will receive all accrued and unpaid statutory holiday and vacation pay (if any), salary, and expense reimbursement, up to and including the End Date, less regular and statutory deductions, as applicable. In addition, provided you execute and deliver the enclosed release to the undersigned, the Company will provide you with the following: 1. the Company shall pay you an amount equal to 13 months’ salary, less statutory deductions (the “Separation Payment”) on October 31, 2023; 2. continue each of your Benefits to remain for a period of 12 months from the End Date; and 3. subject to Section 5.10 of your employment agreement, and subject to the Company’s Option Plan and the rules and policies of any regulatory authority and stock exchange having jurisdiction over the Company, the opportunity to exercise any unexercised and fully vested portion of any Options on the End Date at any time during the Termination Option Exercise Period. If you fail to execute and deliver the enclosed release, you will be paid two (2) weeks’ salary, less statutory deductions (i.e., your Employment Standards Act pay in lieu of notice) without any further requirement on your behalf.
9.TAX INDEMNITY 9.1The deductions for tax and other statutory deductions made from the Settlement by the Company are in accordance with the Company's current understanding of the tax regime. However You agree to be responsible for the payment of any further tax and other statutory deductions (whether the same are payable in the United Kingdom or elsewhere) in respect of all and any part of the Settlement and/or any other payment or benefit received by You in connection with your employment and to indemnify each and every Group Company (and to keep each and every Group Company indemnified on a continuing basis) against all and any liabilities to taxation or statutory deductions (including any interest, fines, penalties, surcharges, costs and expenses) which they may incur in respect of or by reason of all and any part of the Settlement.
ii. Post-Series C Funding. Following the close of the Series C Funding or a Strategic Transaction, the Company shall, during the Employment Term, pay Executive a Base Salary of Twenty-Five Thousand Dollars ($25,000) per month (the “Post Series C Salary”), less statutory deductions and withholdings, payable in accordance with the Company’s regular payroll practices. The Company agrees that following the close of the Series C Funding, the Company will pay Executive an amount that equals the difference between Executive’s Pre-Series C Salary and Executive’s Post-Series C Salary, less statutory deductions and withholdings, that would have been earned by Executive had Executive been paid the Post Series C Salary since the Effective Date. It should be noted that while the Company expects to close the Series C Funding, it shall not constitute a breach of this Agreement if the Company does not do so.
A cash award equivalent to fifty percent (50%) of your annual base salary on the Trigger Date. Such payment will occur on the next regular payroll date following the Trigger Date and will be subject to all applicable payroll taxes and statutory deductions.
Compensation and Benefits You will be paid, effective from your date of hire, a base salary in the amount of $335,000 per annum (less the required withholding taxes and other statutory deductions) on a semi-monthly basis. This salary will be the basis for all benefit purposes. You will receive a car allowance of $9,600 per annum (less the required withholding taxes and other statutory deductions) on a semi-monthly basis. The car allowance is payable on the first pay period of each month. The car allowance will be treated as taxable income.
v.Health Care Coverage. Subject to statutory deductions, during the Health Care Continuation Period, the Company will provide health care coverage under the Company’s then-current health care Plan for Executive and Executive’s spouse and eligible dependents on the same basis as if Executive had continued to be employed during that period. If not permitted under the relevant Plan, and subject to statutory deductions, the Company shall pay an amount equivalent to the cost to it of providing cover for the Executive and Executive’s spouse and eligible dependents on the same basis as if the Executive had continued to be a member of the Plan during the Health Care Continuation Period.
A statutory deduction is a mandatory amount that is withheld from an employee’s gross pay by their employer. These deductions are required by law and typically go towards funding government programs and services, such as social security, healthcare, and income taxes. Statutory deductions ensure that employees contribute their fair share towards societal benefits and comply with taxation obligations.
Statutory deductions should be applied when calculating and processing an employee’s payroll. Employers must ensure that these deductions are accurately withheld from each paycheck in accordance with legal requirements. Situations where statutory deductions are used include:
Writing statutory deductions accurately involves several steps:
Identify applicable deductions: Know the relevant statutory deductions for your region, such as income tax, social security, and healthcare premiums.
Calculate the deduction amounts: Based on the employee’s gross pay and regulatory formulas, calculate the exact amounts to be deducted.
Document the deductions: Clearly specify each statutory deduction on the employee’s payslip. The format should include:
Example payslip section:
Federal Income Tax: $200
Social Security Tax: $150
Medicare Tax: $50
Total Statutory Deductions: $400
Statutory deductions are commonly found in employment contracts. These contracts stipulate the terms under which an employee will work and include details on compensation, benefits, and deductions. Specific sections where statutory deductions appear include:
Example contract clause:
10. Deductions and Withholdings
The Employee agrees that the Employer shall withhold from the Employee’s gross salary all necessary statutory deductions, including but not limited to, federal and state income taxes, social security taxes, and any other deductions required by law.
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