Employee retirement benefit trust

Employee retirement benefit trusts are securities and other assets owned by companies entrusted to make retirement benefit payments. Such securities and other assets are managed in the trust by trust banks for the benefit of the employees and the retirees of those companies.

Employee retirement benefit trust

How employee retirement benefit trust works

  1. Companies enter into a trust contract with trust banks and entrust securities and other assets they own to trust banks for lump sum retirement benefits and for premium payments for corporate pensions.
  2. Trust banks provide entire or partial payment of lump sum retirement benefits to the company's retirees, or make entire or partial premium payments to qualified retirement pensions or employee pension funds, from the retirement benefit trusts.
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If a company plans to use assets entrusted in the retirement benefit trust when providing severance payments or making premium payments to the corporate pension fund, it may pay severance money directly to the retirees or make premium payments to the corporate pension fund, as it has done in the past, unless entire payments are made from the retirement benefit trust.

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