Author: Michaela Resch
Date of Publication: 07/01/2023
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What exactly are employee benefits?
If you're looking for a new job opportunity, maybe you have already heard about the topic of employee benefits. But what exactly is that? Well, employee benefits are work perks provided by your employer. These benefits are like different kinds of indirect recompense. Nowadays, it's almost impossible for employers not to offer these advantages for their employees, if you want to be an attractive and competitive company on the labor market. For example, there are employee benefits for different areas in life,such as employee health insurance, bonuses or paid vacation. So, it depends on the country you live in and the company you work for, if they offer these benefits for good employees. But bear in mind that good employees are those who do very good work or meet deadlines. However, some companies make these benefits universally available, regardless of employee performance.
Why are employee benefits important?
As already mentioned, it is important to offer employee benefits in order to be an attractive employer and to hire valuable new employees. In order to retain key employees and minimize turnover, it is important to keep them satisfied, healthy, happy and loyal. All of these factors lead to an improvement in the performance and achievements of employees and their quality of life. So, the salary alone no longer plays the main role in the search and selection of a new employer. For example, it is more important for some employees to have flexible working hours and mobile working due to family and hobbies than to receive a higher salary.
Main Types of Benefits
Health
Examples:
employee health insurance
dental insurance
medical screenings
fitness
employee assistance program (eap)
Financial
Examples:
bonuses, stock options
gifts and awards
life insurance
capital accumulation benefits
retirement plan
Lifestyle
Examples:
wellness
paid time off
flexible hours
working from home
food
Work
Examples:
free work equipment (laptop, phone, car or e-bike)
trainings and coaching
employee events
Advantages of Benefits
But the question is, what are the advantages of these fringe benefits? There are advantages on both sides of this issue, for the employer and the employee.
For the employer, branding is of course a very important point, as they must position themselves as attractive. Through good branding, very good talents can be brought into the company to strengthen the own team. In addition, you stand out from the competition and collect arguments for applicants to choose your own company instead of another. In addition, through the benefits, a company shows appreciation for its employees, which in turn increases the loyalty of the team. Another pron is reduced turnover, which avoids time-consuming and expensive recruitment processes and training phases. Of course, these benefits can also save on taxes and duties. Basically, compared to a salary, the costs are lower and a larger net amount is received by the employee.
On the other hand, the benefits for the company's own employees are clear. The employees benefit directly from the financial advantages in the first place. Depending on additional benefits, employees can save money or receive other benefits that lead to a better financial situation. And if the benefits offered match the needs of the employees, this also increases the employees' identification with the company. In addition, motivation is more through employer recognition, which also promotes a positive working atmosphere.
Disadvantages of Benefits
Companies usually choose the benefits that appeal to and could help the majority of employees. However, this can of course never apply to all employees, which is why there can be disadvantages for individual employees. These are naturally less satisfied with the offers. Some benefits also turn out to be more of an advantage for the company than for the individual employees themselves. Sometimes, for example, companies change their insurance plans, which of course means that the growth in annual insurance, for instance, is a disadvantage for the employee.
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