Payroll Glossary - N

NACHA: NACHA, The Electronic Payments Association.

National Council States: For workers. compensation purposes, states that adhere to the uniform classifi- cation codes in the Basic Manual for Workers. Compensation, published by the National Council on Compensation Insurance.

National Medical Support Notice (NMSN): Document provided by a state child support agency to an employer requiring that an employee's child be enrolled in medical insurance coverage provided by the employer and that an amount be withheld from the employee's wages to pay premiums for the coverage.

Negative Account Employer: An employer whose state unemployment tax payments are less than the benefits charged to its unemployment reserve account.

Negative Election: A salary deferral to fund pre-tax employee benefits that is begun without the employee making an affirmative election to begin the deferral.

Net Pay: That part of an employee's wages that remains after all deductions have been subtracted (e.g., taxes, health insurance premiums, union dues, etc.).

Network: System connecting computers and applications that consists of the physical connection (topology) and the software.

New Hire Reporting: The reporting of newly hired and rehired employees to state agencies to facilitate the collection of child support and/or to uncover abuse in the state's unemployment compensation, workers. compensation, or public assistance programs.

NLRB: National Labor Relations Board.

NMSN: National Medical Support Notice

No-Additional-Cost Services: A tax-free fringe benefit for employees consisting of free services offered by an employer at no substantial additional cost to the employer.

Nonaccountable Plan: An employer's business expense reimbursement plan that does not meet the requirements regarding business connection, substantiation, and returning excess amounts. Payments made under the plan are included in employees. income.

Noncash Fringe Benefits: Benefits provided to employees in some form other than cash (e.g., company car, health and life insurance, parking facility, etc.), which may be taxable or nontaxable.

Nondiscrimination Testing: Tests that determine whether benefit plans provided by an employer dis- criminate in favor of highly compensated or key employees. If such discrimination is found, the employer will lose its favorable tax treatment for the benefit. Benefits provided under the plan may be taxable to employees receiving them.

Nonexempt Employees: Employees who are covered by the minimum wage and overtime provisions of the Fair Labor Standards Act. They may be paid on an hourly or salary basis.

Nonqualified Plan: In the context of employee benefits, an employer plan that does not meet IRS qualifi- cation requirements.

Nonqualified Stock Option (NSO): See .Nonstatutory Stock Option..

Nonresident Alien: An individual from a foreign country working in the United States who does not pass either the green card. or 'substantial presence. residency test, but is subject to federal income tax on United States source income.

Nonstatutory Stock Option (NSO): A stock option plan that gives an employee the opportunity to buy the employer corporation's stock at a fixed price for a certain period of time, without the conditions that apply to an incentive stock option.

Normal Credit: Amount of an employer's required contributions paid timely into a state unemployment insurance fund, to a maximum of 90% of the employer's basic federal unemployment tax rate, taken as a credit against the employer's federal unemployment tax.

Normal Retirement Age: Currently 65 and 2 months, the age at which retirees may receive unreduced social security benefits. Individual company retirement plans may use a different age.

NSO: Nonqualified Stock Option; Nonstatutory Stock Option.