Employee Benefits

HR Glossary for HR Professionals

Glossary of the most common HR terms and acronyms to assist professionals navigating the ever-growing and ever-changing world of HR terminology.

Employee Benefits

What are Employee Benefits?

Employee benefits come in many shapes and sizes. Meanwhile, benefits include some sort of ‘perk’ provided to employees that an employee receives, in addition to wages. Subsequently, this could include health insurance, pension plans, sick leave, vacation, etc.

That is to say, offering competitive employee benefits is a great way employers can attract and retain top employees.

Benefits Classifications:

Firstly, at a basic level, fringe benefits are generally any extra benefit an employee receives, in addition to, or instead of a salary for services provided.

For example, here are some common fringe benefits:

  • Health insurance
  • Life insurance
  • Tuition assistance
  • Company-paid meals
  • Wellness programs
  • Paid time off
  • Commuter benefits
  • Health savings accounts

Secondly, ancillary benefits are secondary types of health insurance that covers miscellaneous medical expenses.

For instance, common examples of ancillary benefits include:

  • Vision insurance
  • Dental insurance
  • Life insurance
  • Short-term disability insurance
  • Long-term-disability insurance

* In other words, each of these benefit types can be classified as both a fringe benefit and an ancillary benefit.

Thirdly, voluntary benefits are offered by employers but paid for mostly, or 100%, by the employee via payroll deductions.

For instance, common examples of voluntary benefits include:

  • Dental Insurance
  • Vision Insurance
  • Critical Illness Insurance
  • Accident Insurance 
  • Long-Term Care Insurance

Lastly, statutory benefits, otherwise known as mandatory benefits, are required by law.

For instance, here are a few examples of statutory benefits:

Top Employee Benefits:

Above all, the top 5 most attractive employee benefits trends to continue to watch include:

    1. Better health, dental and vision insurance
    2. Flexible work hours
    3. More vacation time
    4. Option to work from home
    5. Student loan assistance

However, other popular employee benefits:

    1. Tuition assistance
    2. Paid maternity/paternity leave
    3. Free daycare services
    4. Company-wide retreats
    5. On-site gym for employee use or discounted gym membership
    6. Team trips or events
    7. Free snacks/coffee in the office

Additional Resources:

Looking for more insight on employee benefits? Check out our Benefits for Beginners guide to learn what benefits to offer, how to implement benefits, and more.

Related Terms: Floating Holidays

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