Fringe Benefits Include Sick Pay?

[austin3515]

Anyone who is familiar with this document which defines fringe benefits... IRM 4.23.5.11 (11-03-2009)

I had been referring to this document as a good listing of what exactly a fringe benefit would be. Imagine my surprise when there at the end of the list was "Sick Pay."

Certainly no one would sugges that a plan that excludes fringe benefits would exclude sick pay from the plan's definitio of compensation??

[PensionPro]

1. No federal or state law requires an employer to provide sick pay.

2. It may be paid by either the employer or a third party, such as an insurance company.

[austin3515]

1. No federal or state law requires an employer to provide sick pay.

2. It may be paid by either the employer or a third party, such as an insurance company.

Could you elaborate? I'm not sure how your comments answer the question. Would sick pay be considered a fringe benefit?

[masteff]

I suspect it made the list because of IRC Section 104,"Compensation for Injuries or Sickness". Refer to page 7 here: http://www.irs.gov/pub/irs-tege/fringe_benefit_fslg.pdf for a list of code sections that the IRS apparently considers being related to "fringe benefits".

My opinion is if the sick pay was earned/accrued in a manner that relates to service performed for the employer (x days off per year, y hours per month, etc), then treat it like normal wages. This is consistent w/ holiday and vacation which are aguably earned/accrued in a manner that relates to service performed.

I'd think that if the sick pay were paid from an insurance policy such as PPro mentioned, then it would be a fringe. (And arguably, that could be the point, that what we sometimes call a short-term disability policy would be a fringe and not earned wages.)