Examples of these benefits include: housing (employer-provided or employer-paid) furnished or not, with or without free utilities; group insurance (health, dental, life etc.
); disability income protection; retirement benefits; daycare; tuition reimbursement; sick leave; vacation (paid and unpaid); social security; profit sharing; employer student loan contributions; conveyancing; long service leave; domestic help (servants); and other specialized benefits.
The purpose of employee benefits is to increase the economic security of staff members, and in doing so, improve worker retention across the organization.
Common perks are take-home vehicles, hotel stays, free refreshments, leisure activities on work time (golf, etc.
The Bureau of Labor Statistics,[4] like the International Accounting Standards Board,[5] defines employee benefits as forms of indirect expenses.
[7] Employee benefits in Canada usually refer to employer sponsored life, disability, health, and dental plans.
Benefits may also include formal or informal employee discount programs that grant workers access to specialized offerings from local and regional vendors (like movies and theme park tickets, wellness programs, discounted shopping, hotels and resorts, and so on).
[9][10] Employers that offer these types of work-life perks seek to raise employee satisfaction, corporate loyalty, and worker retention by providing valuable benefits that go beyond a base salary figure.
The portion paid by employees is deducted from their gross pay before federal and state taxes are applied.
If certain conditions are met, employer provided meals and lodging may be excluded from an employee's gross income.
The payments must be reasonable and necessary personal, family, living, or funeral expenses that have been incurred as a result of a national disaster.
[19] How flexible benefits schemes are structured has remained fairly consistent over the years, although the definition of flex has changed quite a lot since it first arrived in the UK in the 1980s.
In a salary sacrifice arrangement an employee gives up the right to part of the cash remuneration due under their contract of employment.
[21] "Voluntary benefits" is the name given to a collection of benefits that employees choose to opt-in for and pay for personally, although as with flex plans, many employers make use of salary sacrifice schemes where the employee reduces their salary in exchange for the employer paying for the perk.
These tend to include benefits such as the government-backed (and therefore tax-efficient) cycle to work, pension contributions and childcare vouchers and also specially arranged discounts on retail and leisure vouchers, gym membership and discounts at local shops and restaurants (providers include Xexec).
The UK system of state pension provision is dependent upon the payment of National Insurance Contributions.