In today’s workforce, employees demand to feel valued at work, compensated for their talents, and recognized for their efforts. When this is lacking from an employer, employees do not hesitate to find another. Fringe benefits are a way to stay competitive in your industry as an employer and are very important for your employees.
Fringe Benefits: How Important Are They For Your Employees
“Fringe benefits are one of the ways a company can make its remote employees feel valued and taken care of. In the long run, providing such benefits to employees can yield good returns as this promotes employee retention, job satisfaction and quality of life at work.”
– Sam Willis, Franchise Selling Consultant
Let’s deep dive into what fringe benefits are, some examples, advantages, and answer the question of why they are important for your employees.
What are Fringe Benefits?
Fringe benefits are additional benefits offered by an employer to employees in addition to their provided salary. Some fringe benefits are required by law for companies that meet various requirements such as health insurance, unemployment insurance, family and medical leave, and worker’s compensation. However, voluntary fringe benefits can be offered by employers at their discretion and are what we will be focusing on today.
Examples of Fringe Benefits
There are almost infinite options of fringe benefits that you can offer as an employer, but here are some popular examples.
- Stock Options: If your company is publicly traded, stock options are a valuable fringe benefit to add to your employee’s compensation package.
- Profit-Sharing: Profit sharing is a powerful motivator for productivity which means that it will not only benefit you in the way of production capacity but it is a good alternative to increased salaries as well.
- Paid Holidays: Many companies already offer paid holidays as a fringe benefit, but additional paid time off is another attractive option if you already pay out for holidays.
- Education Reimbursement and Opportunities: Education advancement assistance is a win-win because employees get to add new skills to their repertoire and you get highly educated capable staff.
- Life & Disability Insurance: Offering life and disability insurance is a popular option because it gives employees a sense of security.
- Retirement: Having retirement planning and retirement accounts with a match option is an excellent way for employees to see a long-term future with your company and therefore is a valuable fringe benefit.
- Memberships, Discounts, and Subscriptions: Memberships, discounts, and subscriptions to useful activities, programs, and applications typically do not cost the company much, but are welcomed by employees.
- Incentive programs: Incentive programs are another fringe benefit that increases productivity, morale, and engagement by rewarding employees for their hard work. This could be in the form of bonuses, vouchers, extra paid time off, gift cards, or whatever your employees value most.
Advantages of Fringe Benefits for Employers
- Fringe benefits don’t just positively affect employees. There are several advantages for employers as well.
- Increased Positive Public Perception
- It is becoming more common for customers to only support companies that compensate and treat their employees well. By offering voluntary fringe benefits, you increase positive public perception of your company and therefore drive up customer loyalty and sales.
- Employee Engagement & Wellness
- Offering fringe benefits increases employee engagement, wellness, and morale leading to fewer absences and prevention of burnout. In turn, this ensures productivity stays consistent for the company.
- Employee Retention
- Employers offering fringe benefits often have a much higher employee retention rate because they feel compensated for their efforts and valued as a part of the team. Employee turnover is a big money and time expense which means that offering voluntary fringe benefits could actually save you money in the long run by increasing retention rates.
- Attract High-Value Talent
In a competitive industry all looking for the best talent, it is crucial to stand out. High-value talent likely always has several offers and to attract them to your company, you have to provide more than a competitive salary. Fringe benefits are the edge that will make your company stand out and attract high-value talent.
So How Important are Fringe Benefits?
On your end as an employer, they can be a difference between success and failure because the success of a company can often be attributed to the team behind it which makes fringe benefits one of the most important things your company can implement.
This article is a guest contribution by Andrew Nelson, HR Management Writer and Author of HR Musings.com