What are corporate benefits and why are they important?

What are corporate benefits and why are they important?

In this article

• What are corporate benefits? Definition and examples

• Why are corporate benefits so important?

• What are fringe benefits

• Examples of fringe benefits

• What about the employers?

• The recruitment phase

Rewarding employees with exclusive company benefits can be a valuable move to motivate staff and keep them in the company.

What are corporate benefits? Definition and examples

Flexible hours, meal vouchers, summer picnics, days dedicated to wellness, online or company learning courses, family support, gym tickets: these can represent just a few examples of company benefits (or “perks”) that many companies, in Italy and around the world, provide for their employees. The goal? To increase staff well-being and contribute to improving the work environment.

But let’s see the full meaning of corporate benefits, what they are and who they are intended for.

Company benefits are a set of goods or services offered by the employer to their employees outside of their salary. Therefore, they represent a non-monetary compensation, provided in goods or services that aim to improve the quality of life of the employee within (and often also outside) the company itself.

They fall within the concept of corporate welfare, that is, the set of initiatives and services aimed at increasing the well-being of an employee.

From health care to economic support for families, from supplementary pensions to education support, these are some of the benefits that are most appreciated and most frequently provided by companies. Why? Benefits of this type are often linked to tax incentives and, consequently, take on increasing importance for the employee and for the employer. There is often, also a connected increase in productivity and level of well-being in the workplace.

Taking care of employees makes them feel valued, which is why many companies in collaboration with their Human Resources (HR) teams, provide employees with additional goods or services.

Company benefits are frequently offered to employees as part of the overall remuneration package. For example, Buffer, a social media management software company has placed transparency at the heart of its corporate policies. From the exchange of open emails, to transparent and visible company revenues, and the concept of “Open Salaries”, calculated on the basis of a formula shared with all the people in the company. A series of important initiatives that contribute to a more tranquil workplace and, at the same time, increase the level of satisfaction of all employees and their involvement and engagement.

Providing valuable company benefits can also impact the employee retention strategy by significantly increasing the chances of retaining the best talent in the company. Employee retention also decreases the chances of staff leaving for positions with competitors and taking company know-how with them.

Why are corporate benefits so important?

The main resource of a company is its employees. Retaining the best employees or the most qualified staff is (or should be) the primary goal of any organisation. At the same time, ensuring a pleasant working environment can be the cornerstone for an employee remaining with the company. Some surveys and market research have shown that employees have a preference for generous corporate benefits compared to increases in their salary (source glassdoor.com).

Fringe benefits are also placed in this category.

What are fringe benefits

These are goods that are ancillary to the employee’s salary. Extra benefits that are provided by the employer, aside from the usual remuneration, with the aim of encouraging productivity, and also well-being in the workplace. These are goods that are not a cash payment and which, up to a certain amount (around 260 euros) are not taxed. NOTE ITALY ONLY?

Examples of fringe benefits

Fringe benefits, in addition to improving the quality of life of the employee inside (and outside) the workplace, provide a positive and dynamic image of the company. In fact, staff that receive company benefits typically do not have issues within the workplace and contribute to an overall more peaceful and productive working environment. There is also an advantage for the employer because company benefits do not require payment of excessive taxes, thus also leading to a not insignificant saving for the company.

Benefits are usually granted by companies with a high number of employees and with a substantial turnover, for example, the well-known platform Dropbox, based in San Francisco, California, provides its  with employees boat rides, board games evenings and picnics organised for colleagues, a good way to increase well-being and relationships between employees. The Glaukos Corporation produces a device that reduces eye pressure and drug addiction for glaucoma. Precisely for this reason the company takes care of the health of all employees, guaranteeing them free health coverage on eye examinations. In addition, all those who serve the company are given the opportunity to purchase company shares at an advantageous price. Washington Post employees can periodically enjoy field trips, plays, concerts and events with their colleagues while Equinox, a fitness and health facility company, offers its employees the opportunity to participate in fitness classes to maximise team potential and get the most out of their employees. Remarkable isn’t it?

Understanding the real value of these employee benefits is no small plus, in fact, satisfied employees tend to work more productively and at a higher level.

What are the company benefits that are most appreciated by candidates and employees? Here are some examples:

o A library: creating a library with the opportunity to borrow books can be a valuable, and constant, training opportunity for the company and its resources;

o Company cars: very useful benefit for those who, on a daily basis, make important trips for their work;

o Bringing children to work: giving employees the opportunity to bring children to the workplace, to get to know their parents’ activities and the people and places where they work can be an excellent way to retain staff;

o Offer scholarships: giving scholarships to those who want to grow and consolidate their training can be very important;

o Leave for new parents: having leave when you become a new parent will always be a very appreciated gesture;

o Give meal vouchers: these represent one of the most appreciated benefits among employees. This is why it is also one of the most requested and supplied by companies;

o Agreements with gyms, cinemas, etc.: companies often manage to obtain agreements / offers with gyms, cinemas or fitness rooms for their employees;

o Possibility of covering different positions: having the opportunity to cover different positions within the company can be a significant stimulus for an employee;

o Working with music: a company benefit that contributes to maintaining a pleasant and relaxed working climate;

o Company nursery: the possibility of using a company nursery is a benefit appreciated by all parents.

What about the employers?

So how should companies and employers behave?

o Listen and understand what employees really want: strong listening skills can be invaluable. In this way, the work of Human Resources can be fundamental: organising periodic meetings with employees to understand their degree of job satisfaction can be very important;

o Offer advantages in line with the company resources: it is not always necessary to spend money to offer benefits. Some companies, for example, are openly pet-friendly. The chance to bring your dog to the office (perhaps only on certain days of the week) is a significant corporate benefit. Even smart working, for example, is one of the most widespread company benefits: dedicating one or more days a month / week to working from home allows staff to better manage their free time. Over the past year, due to the pandemic, smart working has increased exponentially in companies. Although in most cases employees have experienced home working and not actual smart working;

o Constantly thanking your employees: a small action with a big impact. Thanking employees, interacting with them and making them feel an active part of the whole company is a simple gesture that builds loyalty and binds workers to their workplace and transforms it into a place of well-being and satisfaction.

The recruitment phase

Company benefits are also essential in the recruitment phase. The best candidates also choose a company for the benefits it provides.

If you are a recruiter it is important to understand how to communicate the benefits offered by the company.

Here are some places to put them:

  • On the company’s career page
  • In the company blog, within profiles with company employees
  • Within the Job descriptions or job announcement
  • In specific posts on Social Networks (LinkedIn, Facebook, Twitter)
  • In the “Life” tab of your Company page on LinkedIn
  • Verbally, during interviews

An integrated management of the recruitment process allows you to organise and monitor all these candidate-company contact points. But how can you manage them all? An ATS software like In-recruiting allows you to organise the entire search and selection process of candidates, to coordinate with your recruiting team and to keep track of all the fundamental metrics. and really relate to candidates / employees and effectively communicate your benefits. Your Employer branding will certainly benefit.

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