Employee benefit programs: 17 benefits you should be offering

‍With over 78% of employees stating that a robust benefits package is a key factor in their job satisfaction and loyalty, the importance of a comprehensive and thoughtful employee benefits program cannot be understated in today's competitive job market.

From health insurance to innovative offerings like Lifestyle Spending Accounts (LSAs), the scope of what constitutes an effective benefits program is expanding rapidly.

Simply put, companies must prioritize their employees' well-being and diverse needs to stay ahead in the ever-evolving landscape. 

This means offering a range of benefits and ensuring these benefits are relevant, accessible, and valued by the workforce. 

This comprehensive guide delves into 17 essential benefits your employee program should offer to build a happier, more productive team.

Key takeaways

• Tailoring benefits to diverse employee needs fosters an inclusive workplace.
• Encouraging employee growth through professional development opportunities is beneficial.
• Employee benefits are crucial for job satisfaction, loyalty, and competitive advantage.
• Employee benefits boost talent attraction, retention, productivity, diversity, company reputation, and work-life balance.
• Categories of employee benefits include lifestyle, health, financial, workplace-specific, family and parental, leave and time off, personal development, and social responsibility.
• Best practices for benefit programs involve understanding employee needs, offering flexible choices, regular review, effective communication, feedback mechanisms, compliance, and cost-benefit analysis.

What are employee benefits?

At its core, employee benefits are non-wage compensations provided to employees in addition to their regular salaries or wages. 

These benefits, often referred to as 'perks' or 'fringe benefits,' are powerful tools for organizations to attract, retain, and motivate their employees.

The scope of employee benefits is broad and diverse, extending beyond the traditional health insurance and retirement plans. They can include a variety of offerings, such as 

• Medical, dental, and vision insurance
• Life insurance
• Paid time off
• Parental leave
• Retirement savings plans. 

However, in recent years, the concept of employee benefits has evolved significantly, now embracing more contemporary benefits like;

• Lifestyle Spending Accounts
• Flexible working hours
• Wellness programs
• Professional development opportunities
• Childcare assistance.

One of the key aspects that distinguish employee benefits is their ability to be tailored to the specific needs and preferences of employees. 

This customization enhances the attractiveness of these benefits and demonstrates an employer's commitment to addressing their employees' unique lifestyle and well-being concerns. 

Why are employee benefits important?

Employee benefits transcend being mere add-ons to the compensation package.

A well-structured benefits program can lead to higher employee engagement, reduced turnover, and increased productivity.

Here's a breakdown;

1. Attracting top talent

Employee benefits represent the company's culture and its stance on employee welfare. 

Top candidates often scout for employers who offer comprehensive health plans, retirement benefits, and unique perks like flexible work schedules.

These benefits communicate that the company values its employees' overall well-being, not just their output.

2. Boosting employee retention

Employee turnover is costly. A solid benefits package tailored to the workforce's needs fosters loyalty and satisfaction. 

Employees who feel valued and taken care of are less likely to seek opportunities elsewhere. 

This retention is not just about reducing turnover costs; it’s about preserving organizational knowledge and maintaining a stable, experienced workforce.

3. Enhancing employee productivity and engagement

The link between employee well-being and productivity is well-established. Benefits that address mental health offer wellness programs and ensure personal and professional balance, leading to both present engaged and productive employees. 

These programs show employees that the company invests in their health and happiness, which, in turn, motivates them to invest their best efforts in their work.

4. Supporting diversity and inclusion

A diverse workforce requires a diverse range of benefits. Tailoring benefits to cater to different lifestyles, cultures, and needs demonstrates an organization's commitment to an inclusive workplace. 

This can range from offering different health insurance plans to accommodate different needs to recognizing diverse cultural holidays. 

Such inclusivity promotes a more harmonious and respectful work environment.

5. Improving company reputation and brand

A company known for its exceptional employee benefits will likely have a positive reputation as an employer. 

This enhances its brand not just among potential employees but also in its industry and with its customer base. 

Clients and partners often view companies that care for their employees as more trustworthy and reliable.

6. Reducing absenteeism and healthcare costs

Comprehensive health benefits and wellness programs contribute significantly to a healthier workforce. Healthy employees mean fewer sick days, less strain on the company’s resources, and reduced healthcare costs. 

Preventative health programs, in particular, can mitigate long-term health issues, leading to a more consistent and productive workforce.

7. Encouraging employee loyalty and morale

Employees who feel valued and supported are likelier to demonstrate loyalty and high morale. 

Benefits that align with their values, such as environmental sustainability, community engagement, or family support, foster a deep sense of belonging and pride in their workplace. 

This emotional connection is invaluable for long-term employee retention.

8. Fostering professional development

Investing in employees’ professional growth through education benefits and training programs is a win-win. 

It not only aids employees in their career progression but also ensures the company remains competitive with a skilled workforce. 

This focus on development can also lead to innovation and new ideas, keeping the company at the forefront of its industry.

9. Adapting to changing workforce demands

The modern workforce is dynamic, and so are its demands. Benefits that reflect this, like remote working options, mental health days, and vacations, show a company's ability to adapt to contemporary work-life needs. 

This adaptability is crucial in attracting and retaining younger generations of workers who prioritize flexibility and mental well-being.

10. Enhancing work-life balance

The pursuit of a healthy work-life balance is a necessity. Benefits that aid in this balance, like flexible working hours, family leave, and child care support, contribute significantly to employee satisfaction. 

They help reduce stress and burnout, leading to a more engaged and productive workforce and, importantly, a happier one.

Overall, as we move forward, the importance of employee benefits in the work landscape will only grow, making thoughtful implementation and management of these benefits a key factor in organizational success.

What are the different categories of employee benefits?

Employee benefits are a pivotal aspect of the employer-employee relationship, catering to various facets of an employee's life. 

Different categories of employee benefits include:

1. Lifestyle benefits

Lifestyle benefits are designed to enrich an employee's personal life, offering a more balanced and flexible approach.

Lifestyle Spending Accounts (LSAs), a standout feature in this category, are an innovative way to incorporate a  flexible benefits plan into your employee benefits program.

Managed effectively through employee benefits platforms like Forma, LSAs empower employees to allocate funds to areas that resonate with their interests and needs, such as 

• Wellness 
• Fitness
• Remote work
• Learning and development
• Student loan assistance
• Legal services
• Pet care
• Financial wellness
• Adoption & fertility support
• Education
• Hobbies

This customization enhances employee engagement and satisfaction, acknowledging and supporting their lifestyles. 

The efficiency of LSAs depends significantly on using intuitive and user-friendly software that enables easy management and access to these benefits. 

To learn more about lifestyle spending accounts [schedule a consultation](https://joinforma.com/schedule-consultation) with one of Forma's experts today.

2. Health benefits

Health benefits are a fundamental component of any employee benefits package. They typically include;

• Comprehensive medical insurance
• Dental and vision plans
• Mental health support
• Access to wellness programs

The scope of these benefits often extends to cover preventive care, chronic disease management, and emergency health services. 

The availability of these benefits is crucial in safeguarding employees' physical and mental health, ensuring they have the necessary support to lead healthy lives in and out of the workplace.

3. Financial benefits

Financial benefits help employees in securing their future financially. This category encompasses retirement plans like;

• 401(k)s 
• Pensions
• Stock option plans
• Financial planning and counseling services

Offering life insurance, disability insurance, and education savings plans are also part of this category, providing employees with a safety net for unforeseen circumstances. 

These benefits are instrumental in aiding employees in building their financial resilience, offering them peace of mind and a sense of security regarding their long-term financial well-being.

4. Benefits at work or in the office

Workplace-specific benefits are designed to enhance the daily working experience of employees. 

This category includes;

• Flexible work arrangements, such as the option to work remotely or have flexible start and end times
• On-site amenities like fitness centers, cafes, and relaxation areas 

These can significantly improve the workplace environment, making it more enjoyable and conducive to productivity. 

Opportunities for professional development, such as workshops, seminars, and access to online learning platforms, are also key in helping employees advance their skills and career prospects. 

Collectively, they contribute to a positive and dynamic work culture, boosting employee morale and engagement.

5. Family and parental benefits

Recognizing the importance of family, many employers offer benefits that specifically support parenting and family life. 

These may include;

• Extended maternity and paternity leave
• Adoption assistance
• Childcare services
• Flexible scheduling options for parents

By providing such support, employers demonstrate their understanding and accommodation of employees' family commitments, which is crucial in fostering a supportive and empathetic workplace environment.

6. Leave and time off

Another aspect of maintaining a healthy work-life balance is the provision of adequate leave. 

This category covers paid time off (PTO), including 

• Vacation days
• Sick leave
• Sabbaticals

Progressive companies are now exploring policies like unlimited PTO, recognizing the need for employees to take time off for rest, recreation, and personal matters. 

Such benefits are essential in preventing burnout and ensuring employees return to work refreshed and reinvigorated.

7. Personal development and education

Investing in employees' personal and professional growth benefits the individual and the organization. '

Benefits such as tuition reimbursement, sponsorship for professional certifications and access to training programs enable employees to enhance their skills and knowledge. 

This aids in their personal development and ensures the company nurtures a highly skilled and competent workforce ready to meet the challenges of an evolving business landscape.

8. Community and social responsibility

More companies are now incorporating community engagement and social responsibility into their benefits offerings. 

These initiatives can include

• Volunteer day-offs
• Involvement in sustainability projects

Such benefits resonate with employees who are passionate about positively impacting their communities and the world at large, fostering a sense of purpose and fulfillment beyond the workplace.

Each category is crucial in building a well-rounded and appealing employee benefits package, enhancing employee satisfaction, loyalty, and overall company performance.

17 different benefits to add to your employee benefits program

Each benefit is a tool to foster a positive work environment, improve employee satisfaction, and drive organizational success. 

They include;

1. Lifestyle Spending Accounts (LSAs)

Lifestyle Spending Accounts (LSAs) have emerged as an essential component of employee benefits programs in 2024. 

These accounts offer employees a flexible way to cover various personal expenses, such as fitness, wellness, or continuing education, which are not typically included in standard benefits packages. 

Recent statistics have shown a significant increase in employee satisfaction and productivity in companies that offer LSAs. 

For instance, a 2023 survey revealed that over 75% of large employees have incorporated lifestyle spending accounts in their benefit programs, leading to higher employee retention rates than those without. 

This shows the growing importance of LSAs in attracting and retaining top talent in a competitive job market.

Incorporating LSAs into your benefits program enhances your company's appeal to prospective employees and demonstrates a commitment to the well-being and personal growth of your existing team. 

Ready to get started? <span class="text-style-link text-color-blue" fs-mirrorclick-element="trigger" role="button">schedule a consultation</span> with one of our experts.

2. Comprehensive health insurance

Offering comprehensive health insurance is a cornerstone of any robust employee benefits program. 

It ensures employees have access to necessary medical, dental, and vision care, safeguarding their health and financial well-being.

Quality health insurance coverage is a significant factor in employee satisfaction and loyalty. 

Providing such insurance demonstrates an employer's investment in their team's health, potentially reducing absenteeism and increasing productivity. 

Moreover, it can be a critical factor for potential employees when choosing between job offers.

A comprehensive health insurance package must be carefully designed to balance coverage and affordability, ensuring it is inclusive of various health needs and accessible to all employees.

3. Mental health support

Mental health support as an employee benefit is increasingly recognized, especially among millennials and Gen Z employees, for its critical importance.

Access to counseling services, mental health days, and resources for emotional wellness are vital. This support helps employees manage stress, anxiety, and other mental health challenges. 

Employers create a more inclusive and supportive work environment by acknowledging and addressing mental health. 

This proactive approach helps maintain a healthier workforce and breaks down the stigma surrounding mental health discussions in the workplace. 

It shows employees that their overall well-being is valued, which can enhance job satisfaction and improve company morale.

4. Retirement savings plans

Retirement savings plans, such as 401(k) or pension plans, represent a significant aspect of long-term financial security for employees. 

These plans encourage employees to save for their future, often with the benefit of employer-matching contributions. Effective retirement plans are more than just a financial tool; they serve as a morale booster and a retention strategy. 

Employees who feel their future is secure will likely remain with a company that invests in their long-term goals. 

Furthermore, offering diverse investment options within these plans allows employees to tailor their savings strategy to their financial situation and retirement goals.

 5. Paid time off (PTO)

Paid time off (PTO) is an essential component of employee benefits, encompassing vacation, sick leave, and personal days. Generous PTO policies reflect an understanding of the importance of work-life balance and the value of rest and recovery. 

Employees with ample PTO are more likely to return to work refreshed and productive, contributing positively to the workplace atmosphere.

Moreover, flexible PTO policies that consider individual needs demonstrate respect for employees' personal lives and commitments outside of work. 

This respect fosters a culture of trust and appreciation, which can be a factor in attracting and retaining talent. 

Effective PTO policies should balance the organization's needs with its employees' well-being, ensuring both business continuity and employee satisfaction.

6. Flexible work hours

Flexible work hours allow employees to adjust their work schedules to better fit their personal lives. 

This benefit is particularly valuable for employees with responsibilities such as childcare or education or who work more effectively at different times.

Flexible hours lead to improved work-life balance, reducing stress and increasing job satisfaction. Employers benefit from this arrangement through potentially higher productivity and lower absenteeism rates. 

7. Remote work options

Remote work options allow employees to work from locations outside the traditional office environment. This benefit has gained immense popularity, particularly due to global shifts towards digital workplaces. 

Employees with the option to work remotely often report higher levels of job satisfaction, citing the elimination of commute times and the ability to create a personalized work environment as key factors. 

For employers, remote work can reduce overhead costs and access to a broader talent pool not limited by geographical constraints. 

However, organizations must provide the necessary tools and support for effective remote work, including robust communication platforms and digital collaboration tools.

8. Wellness programs

Employee wellness programs are designed to support employees' overall health and well-being, encompassing physical, mental, and emotional health. 

These programs often include gym memberships, wellness challenges, health screenings, and nutrition and stress management workshops. 

Employers who invest in wellness programs tend to see a return in the form of reduced healthcare costs, lower absenteeism, and higher productivity. 

More importantly, these programs demonstrate a commitment to the holistic health of employees, contributing to a positive company culture and improved employee morale. 

9. Professional development

Professional development benefits are crucial for fostering employee growth and job satisfaction. These benefits may include funding for courses, conferences, workshops, or even advanced degree programs related to the employee's role. 

By investing in their employees' professional growth, organizations not only enhance the skill set of their workforce but also signal a commitment to their employees' career progression.

Employees with access to professional development opportunities tend to feel more valued and engaged, leading to higher retention rates. 

10. Childcare assistance

Childcare assistance as a benefit addresses a vital need for working parents. It may come through direct financial aid, subsidies, on-site childcare services, or partnerships with local childcare providers. 

Offering childcare assistance alleviates a significant stressor for employees, enabling them to focus more effectively on their work while ensuring their children are well cared for. 

Employers providing childcare assistance often observe increased loyalty and lower turnover rates among their staff. 

Additionally, this benefit is a strong attractor for new talent, particularly those juggling professional and familial responsibilities. 

Effective implementation of childcare assistance requires understanding the varied needs of the workforce and offering flexible solutions that cater to these needs.

11. Transportation benefits

Transportation benefits, such as reimbursements for commuting costs or company-provided transportation, ease the financial and logistical burden of traveling to and from work. 

These benefits are especially appreciated in urban areas where commuting can be costly and time-consuming. 

Employers offering transportation benefits often find that they contribute to punctuality and reduce the stress associated with commuting. 

12. Employee discount programs

Employee discount programs offer workers reduced prices on the company's products or services or products and services from partner organizations. 

These discounts are a tangible way for companies to express appreciation for their employees' hard work and dedication. 

Such programs offer financial benefits and foster a sense of belonging and loyalty among the workforce. 

When employees can access goods and services they value at a lower cost, it enhances their overall job satisfaction and can also serve as an incentive for potential new hires. 

13. Tuition reimbursement

Tuition reimbursement benefits enable employees to pursue further education relevant to their roles, enhancing their skills and career prospects.

Employers offering this benefit demonstrate a commitment to their staff's continuous learning and development. This investment often leads to a more skilled and versatile workforce, driving innovation and keeping the company competitive.

For employees, tuition reimbursement is a significant motivator, often enhancing job satisfaction and loyalty. 

Successful implementation of this benefit involves setting clear policies on eligibility, the types of courses or programs covered, and the process for reimbursement.

14. Health savings account (HSA)

Health savings accounts (HSA) allow employees to set aside money on a pre-tax basis for future medical expenses, offering a financial safety net. 

These accounts are particularly beneficial as they provide tax advantages and the flexibility to use the funds for various health-related expenses. 

HSAs are a practical tool for managing healthcare costs for employees with high-deductible health plans. 

Unsure how a health savings account (HSA) differs from a flexible spending account (FSA)? Check out our blog on HSA vs. FSA comparison.

15. Life insurance and disability coverage

Life insurance and disability coverage provide financial security for employees and their families in the event of unforeseen circumstances. 

Life insurance offers peace of mind, knowing that loved ones will have financial support. At the same time, disability coverage ensures income continuation if an employee cannot work due to illness or injury. 

These benefits are critical components of a comprehensive benefits package, reflecting an employer's care for the long-term well-being of their staff. 

16. Employee recognition programs

Employee recognition programs are designed to acknowledge and reward achievements and contributions in the workplace. 

These programs play a crucial role in boosting morale and motivation. Recognizing employees for their hard work and dedication reinforces positive behaviors and promotes a culture of appreciation and respect. 

Effective recognition programs are diverse, including awards, public acknowledgments, and celebratory events. 

Tailoring these programs to reflect the values and culture of the organization ensures that recognition feels genuine and meaningful. 

Regular and thoughtful recognition contributes to a positive work environment and can significantly enhance employee engagement and retention.

17. Stock options or equity

Offering stock options or equity stakes to employees allows them to share in the company's success, aligning their interests with the organization's growth. 

This benefit is particularly effective in startups and growth-stage companies, where the potential for future value is high. 

Employees with stock options often feel more invested in the company's performance, fostering a sense of ownership and responsibility. 

Implementing stock option plans requires careful consideration of eligibility, vesting schedules, and regulatory compliance. 

Employee benefit program best practices

When designing an employee benefits program, adopting best practices ensures the program is effective, appreciated, and utilized by employees. 

Understanding employee needs

It is vital to gauge the specific needs and preferences of your workforce. This can be achieved through surveys, focus groups, or one-on-one meetings. 

The goal is to collect comprehensive data on what employees value most in their benefits package. This approach ensures the benefits are relevant and desirable, increasing satisfaction and utilization rates.

Offering flexibility in benefit choices

A one-size-fits-all approach to benefits is outdated. Employers should offer diverse benefits, allowing employees to choose what aligns best with their personal and professional goals. 

Flexibility can come in the form of modular plans where employees can pick and choose different benefits or through spending accounts where they have a set amount to allocate according to their needs.

Implementing employee spending accounts

LSAs or similar accounts provide employees with a budget for approved wellness or personal development activities. 

Employees who have control over their benefit dollars are more likely to use them. This autonomy in decision-making leads to higher engagement and satisfaction with the benefits program.

Regular review and adaptation of benefits

The workforce's needs are continually evolving, and so should the benefits program. Regularly reviewing and updating the benefits package ensures it stays relevant and effective. 

This practice demonstrates to employees that the company is committed to their well-being and adapts to changing circumstances.

Effective communication of benefits

Clear and continuous communication about the available benefits and how to utilize them is essential. 

Misunderstandings or lack of awareness can lead to underutilization of benefits. Effective communication channels can include regular meetings, detailed benefit guides, and accessible HR support.

Establishing a feedback loop

Implementing a system to gather feedback on the benefits program is vital. Regular surveys and feedback mechanisms help employers understand the impact of the benefits offered and identify areas for improvement. 

Employee input should be valued and considered when making any changes to the program.

Ensuring compliance and scalability

The benefits program should comply with all legal requirements and be scalable as the company grows. 

This involves staying updated with regulatory changes and ensuring the program adapts to an expanding and diversifying workforce.

Conducting cost-benefit analysis

Regularly assessing the benefits program's financial sustainability and return on investment is important. 

This analysis helps balance costs with the value provided to employees and the overall impact on the organization.

These practices, with a focus on flexibility and autonomy, create a benefits program that is responsive to employee needs, leading to higher satisfaction and better overall outcomes for both employees and the organization.

How to get started with Forma

While considering a benefits program, recognize the complexities of managing diverse employee needs. 

This is one of the areas where Forma excels, offering a streamlined approach to benefit management that is both user-friendly and efficient.

With Forma, you can expect a seamless integration of your existing benefits structure into a more flexible and customizable system. 

Ready to get started? <span class="text-style-link text-color-blue" fs-mirror click-element= "trigger" role="button"> Schedule a consultation</span> with one of our experts to discuss your specific needs.

_{*This document is for informational purposes. Forma is not engaged in the practice of law. Nothing contained herein is intended as tax or legal advice nor to replace tax or legal advice from counsel. If you need tax or legal advice, please consult with counsel or a certified tax professional.}