Employee benefits are a set of employee-provided benefits provided to employees by companies. They can be used to compensate employees for the use of their own time or property, or they can provide health insurance, life insurance, and other financial assistance after retirement. Employee benefits come in many forms, but they are generally presented as a package that includes medical and health care coverage.
Employee benefits can also be referred to as employee benefits packages or sometimes as employee benefit plans. It is important to note that not all employers provide these benefits; however, most large companies offer some type of employee benefit plan.
There are three types of employee benefit plans: health care-only plans, short-term disability plans, and long-term disability plans (also known as LTD).
Health Insurance as an Employee Benefit
This is a benefit you receive as part of a salary package and covers medical expenses you might have if you get sick or injured at work. Most employers offer this benefit, but some companies offer it to all employees regardless of whether they work for them full-time or part-time.
There are two kinds of health insurance: group health insurance and individual health insurance.
Group health insurance provides coverage for all employees in the same department at the same company who work there full-time or part-time with one exception — if an employee's spouse works for another company within the same state as their employer's location, then they may be eligible for coverage under their spouse's plan instead of their plan (in other words, if your husband works for another company within)
Types of Employee Benefits
There are three types of employee benefits:
1. Profit sharing - When a company shares its profits with its employees, it is called profit sharing. This can be done in several ways, but it usually involves giving each employee a percentage of the company's profits after taxes have been paid.
2. Tax-free allowances - Some companies offer employees tax-free subsidies for their health or life insurance premiums. These allowances are tax deductible for the employer, meaning that no taxes are owed to them by either party (the employee or employer).
3. Subsidized loans - Some companies will provide loans to their employees who want to buy an expensive item, such as a car or home, so long as they make certain requirements/conditions first (such as being an employee who makes less than $50k a year).
As technology and healthcare costs spiral out of control, employee benefits become increasingly important. Business owners are taking a good look at their benefits package and realizing they need to give their employees some compensation plan to differentiate themselves from the competition.
Properly-designed employee benefits packages save money in the long term and give employees peace of mind.
Find out how Compport can help you manage all your Employee Benefits process, book a demo today!