Employee benefits are indirectly a key aspect to helping an organization grow and accomplish certain goals and can differentiate said company from competitors. Thus, it’s important to know and understand exactly what they entail.
What Are Employee Benefits & Why Are They Important?
Employee benefits — which in some cases are referred to as perks or fringe benefits — are things companies offer to employees beyond salaries and wages. Benefits packages employers typically provide include health insurance, overtime, paid time off, and retirement plans like 401(k). These benefits can sometimes be negotiated, depending on the terms of the employment agreement an employee signs upon starting a new job. It’s thus important for employees to read their contracts carefully.
Giving workers benefits is crucial, because this demonstrates that employers care about their employees’ well-being and about keeping retention high. Healthy and motivated workers are more likely to take less sick days and perform their jobs better.
Types of Employee Benefits Plans
Employee benefits plans typically vary with each organization and position. These packages can also be quite different for employees in the public sector compared to private industry workers, and can also vary depending on whether employees are full-time or part-time workers. These plans are usually explained in the final-round interview or when a job offer is made.
Here are the essential benefit laws employers are required to follow:
- Employees must be given time off to serve on a jury, vote and perform military service.
- Businesses must comply with all workers’ compensation requirements.
- Employers must pay state and federal unemployment taxes.
- Businesses must contribute to state short-term disability programs wherever these programs exist.
- Employers must comply with the Federal Family and Medical Leave Act (FMLA). This is a 1993 law that requires certain organizations to offer employees unpaid leave for any family-related issues, like caring for a newborn or adopted child or focusing on your own health issues or those of a relative.
- COBRA (Consolidated Omnibus Budget Reconciliation Act): this grants certain employees, spouses, retirees and children who lose medical benefits the option to keep using health benefits provided by their group health plan for restricted periods of time at rates associated with a group.
However, employers have no obligation to provide:
- Medical plans (except in Hawaii)
- Retirement plans (including company contribution/matching)
- Life insurance plans
- Dental or vision plans
- Paid vacations, holidays, or sick leave
Other types of employee benefits or perks employers can provide include wellbeing programs and seminars (that offer incentives for individuals and families), profit sharing, transit/commuter allowance, tuition or student loan contribution, gym memberships, and discounts to company products or services (including food and beverages). Some businesses can also offer salary increases, bonuses, disability insurance, and flexible working hours, including the option to work remotely.
Learning About Employee Benefits Solutions
It’s highly recommended for any employee who is eligible for benefits to speak with an advisor or specialist to learn more about the benefits packages and solutions his or her organization is dedicated to offering. Some employers have an internal employee benefits information system like a portal. There are also other resources available, like the Employee Benefit Research Institute and the International Foundation of Employee Benefits Plans.
Many times, employers possess valuable benefits that remain unused because employees become overwhelmed by the amount of information available to them.
Get Help From Experienced PEO Consultants
BenefitCorp, an organization based in Dallas and Denver, has a team of strategic PEO consultants who are committed to helping individuals, businesses, and families understand benefits. It was founded in 1995 by a trauma nurse who every day met people with insufficient medical coverage.
BenefitCorp strives to simplify and streamline the coordination and quality assurance of payroll, insurance, human resources, and retirement plans for both small and large clients. Its online portal also offers solutions for compliance and risk management and includes a shopping-cart-like interface that allows users to easily view and change their benefits. Among the retirement plan-related services BenefitCorp provides are Fiduciary Services, 5500 filings and ERISA testing, 360-degree Integration, and identifying and recommending cost efficiencies. The insurance benefits-related services BenefitCorp provides include employee online enrollment and bilingual support, 5500/1094/1095 Form Filings, property and casualty insurance, worksite in-person education, Affordable Care Act compliance, and Section 125 Document Management.
BenefitCorp offers consultations over the phone, in person, or online.