Supplemental Executive Retirement Plan - SERP

nonqualified deferred compensation plan for highly compensated employees or select group of personnel. The reporting and disclosure requirements of the employee retirement income security act of (erisa) and the internal revenue code require only the following information: name of the employer, number of employees in the plan, and a statement from the employer that the plan is maintained and funded strictly to provide nonqualified deferred compensation to select number of personnel.

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A non-qualified retirement plan for key company employees, such as executives, that provides benefits above and beyond those covered in other retirement plans such as IRA, 401(k) or NQDC plans. There are many different kinds of SERPs available to companies wishing to ensure their key employees are able to maintain their current standards of living in retirement.

SERPs are also known as "top hat plans".

Investopedia Says:
Unlike NQDC plans, in which key employees defer compensation in order to receive it later, SERPs are entirely funded by the employer. Because of the high costs associated with funding SERPS, they are criticized by shareholder advocates and labor groups that believe some executives are overpaid for their performance.

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