Employee benefits are non-salary compensation that can vary from company to company. Benefits are indirect and non-cash payments within a compensation package. They are provided by organizations in addition to salary to create a competitive package for the potential employee.
The following are compensation and benefits that employers are required by federal or state law to provide. Be sure to confirm what is required in your state. The federal government requires that companies with 20 or more employees continue to provide extended medical benefits to former employees (and their families) for up to 18 months (sometimes longer).States may have additional requirements for extended medical benefits. Make sure to check your state for “mini-COBRA” laws that will protect you and your family in the event that you lose your job.
Disability & Workers Compensation:
The purpose of both workers’ compensation and disability is to make sure that an injured or sick employee continues to get paid (usually a portion of their normal pay) until they are well enough to return to work. Every state has its own workers’ compensation and disability requirements for employers. While some businesses are exempt from providing workers’ compensation, most payroll employees are eligible if they are injured on the job. Only a few states require employers to provide disability coverage. However, many employers offer this Employee benefits of their own accord.
Family and Medical Leave Act (FMLA):
The Family and Medical Leave Act requires some employers to provide maternity, paternity, and adoption leave, but it isn’t required to be paid leave. Most states have their own labor laws pertaining to family additions or medical issues that include paid leave. Beyond federal and state laws, many employers choose to be generous with paid leave for new parents.
The Fair Labor Standards Act sets the current federal minimum wage at $7.25 an hour. In addition, many states have their own minimum wage laws. The law stipulates that whichever minimum wage law is highest overrides the other. For example, New York’s minimum wage laws mandate a higher rate of pay than the federal minimum wage; therefore, the state’s minimum wage laws override federal minimum wage laws.
Similarly, overtime laws vary by state. The Fair Labor Standards Act also stipulates overtime pay requirements. Whichever law (state or federal) benefits an employee the most takes precedence The federal government requires states to manage all unemployment benefits for workers. If an employee worked a qualifying job and was laid-off due to a layoff, they are entitled to unemployment pay for a period of time. The amount of unemployment pay varies by state and job title. Employees who resigned or were fired for their misconduct are typically not eligible for unemployment benefits.
Types of Employer-Provided Benefits and Perks:
In addition to benefits required by law, other benefits are provided by companies because they feel socially responsible to their employees and opt to offer them beyond the level required by law. Depending on the company, these benefits may include health insurance (required to be offered by larger companies), dental insurance, vision care, life insurance, legal insurance, paid vacation leave, personal leave, sick leave, child care, fitness, retirement benefits and planning services, college debt relief, pet insurance, and other optional benefits offered to employees and their families.1
These types of employee benefits are offered at the discretion of the employer or are covered under a labor agreement, so they will vary from company to company.
Who Gets Employee Benefits?
According to the Bureau of Labor Statistics (BLS), the average number of annual paid holidays is 8 for workers in private industry.2 Federal government employees are entitled to 10 paid holidays.
On average, workers received 10 paid vacation days after one year of service. This average increases with tenure – that is, the longer the employee stays with their employer. Employees who have worked five years or more receive 15 paid vacation days. This increased to 20 days after 20 years.3Among non-government employers, 87% offered health benefits according to the BLS. Another 67% offered their employees a pension or retirement program. In addition, more employers are using bonuses, perks, and incentives to recruit and retain employees. Many leading employers offer extra benefits, including health club memberships, flexible schedules, daycare, tuition reimbursement, relaxation classes, and even on-site dry cleaning.