Employee benefits are any form of compensation paid to employees over and above regular salary or wages. Employee benefits come in many forms and are an important part of the overall compensation package offered to employees. In this article, we’ll outline common examples of small business employee benefits.
Interested in recruiting and retaining top talent? Read 11 Strategies for employee retention on a small business budget.
Employee benefit examples
Here is a list of popular employee benefits in the United States:
- Paid time off such as PTO, sick days, and vacation days
- Health insurance
- Life insurance
- Dental insurance
- Vision insurance
- Retirement benefits or accounts
- Healthcare spending or reimbursement accounts, such as HSAs, FSAs, and HRAs
- Long term disability insurance
- Short term disability insurance
- Tuition reimbursement
- Childcare benefits
- Gym memberships or discounts
- Wellness programs
- Employee recognition programs
- Relocation assistance
- Commuting/travel assistance
- Telecommuting options
- Workplace perks such as recreation activities, food and coffee, and flexible work schedules
Related: The Top 5 Types of Employee Benefits
For small- and medium-sized employers with lean operating budgets, some of these examples may seem unaffordable. Before you dismiss offering health or retirement benefits because of cost, however, consider different benefits structures and contribution strategies which help control cost. We’ll cover this next.
Example of employee benefits structures
In general, companies have two different ways to structure, contribute, and offer employee benefits:
- Organizational-oriented benefits: Offer employees a specific or defined benefit. Benefits are employer-owned and employer-selected. Examples include a traditional health insurance policy, retirement pension or 401(k), or formal wellness program.
- Consumer-oriented benefits: Offer employees employer-funded dollars to customize their benefits using technology. Benefits are employer-funded and employee-selected. Examples include a reimbursement plan like a QSEHRA or ICHRA or allowances for wellness activities.
While organizational-oriented benefits are more traditional structures for benefits, many small employers are finding consumer-oriented benefits are of equally high value to employees, are typically more flexible, and also more affordable.
This post was originally published on November 8, 2018. It was last updated on October 13, 2020.