Let’s look at 9 of the most common employee benefits an employer may offer. You may want to consider these when looking for a new job.
1. Medical insurance
Medical insurance is one of the most popular employee benefits companies offer. Because of the Affordable Care Act (ACA), employers with more than 50 full-time employees must offer medical insurance through their employee benefits programs to full-time employees only.³ A medical insurance plan will cover your typical physical health needs, excluding vision and dental.
Some medical insurance plans offer more comprehensive coverage, including:
- Transgender healthcare, like hormone therapy and surgical procedures, that can help alleviate gender dysphoria
- Fertility benefits, like in vitro fertilization (IVF), which can help couples who are struggling to conceive naturally
- Mental health benefits, like talk therapy or psychiatric evaluations, either through a third party or through employee assistance programs (EAPs)
- Prescription medication coverage, which can lower the cost you pay for drugs deemed medically necessary by your doctor
Some companies will cover the total cost of your medical insurance premium, but, in many cases, you’ll have to cover some of it on your own. If your company offers different levels of coverage, choosing the right plan for your situation will depend on several factors, such as the state of your health or the number of family members on the plan.
Find out when your coverage will begin when starting a new job. Some companies require an employee to work for at least 90 days before being able to utilize coverage.
2. Retirement plans
Retirement plan options are another common benefit. There are several different common account types.
- 401(k)s and 403(b)s are the most common types of employer-offered retirement accounts. Which is available to you depends on whether your employer is for-profit or non-profit. Both of these are tax-advantaged ways to save for retirement. The Internal Revenue Service (IRS) allows you to contribute up to a set maximum, which changes from year to year. (Keep in mind, too, that the contribution limit may be different if it’s a Roth plan.) When analyzing the 401(k) plan that your company offers, find out what percentage of your salary you can set aside and what your investment options are as well. Also, many employers will provide a 401(k) match, which matches employee contributions up to a certain amount.
- 457(b) plans are most commonly available to government employees and certain nonprofit employees, and work similarly to 401(k)s in that both employers and employees can make contributions.⁴
- Pension plans are a nice perk for those who have access: a pension guarantees you regular payment throughout your retirement until the end of your life, without your needing to save up for it ahead of time.⁵
3. Life and disability insurance
Life insurance is another benefit employers offer that will cover funeral expenses and other costs in the event of an unexpected death. Sometimes, this is automatically available when you start working at a new company; other times, you must sign up for this benefit yourself. You can also find out how much of a premium your employer will cover and if you’re eligible to purchase additional coverage. Remember that the company you work for is ultimately the policy owner, so you’ll likely lose that coverage if you leave your job.
Disability insurance is also an important benefit that many companies offer. If you were to get injured in an accident or develop a serious illness, this type of insurance can help replace a part of your income if you’re unable to work for an extended period of time. Some companies may offer long-term and short-term disability insurance.
4. Flexible Spending Accounts (FSA) and Healthy Savings Accounts (HSA)
Flexible Spending Accounts (FSAs) allow you to put a portion of your paycheck into a spending account that helps reduce your taxable income. The money in this account can be used for medical expenses and gives you some tax advantages.
FSAs are available with most health insurance plans. However, they come with a “use it or lose it” clause. This means that if you claim $2,000 for the year but you only use $1,700 of it, you then lose $300.
Health Savings Accounts (HSAs) are more like savings accounts for medical expenses — however, you can use those funds whenever you want. The money you put into your HSA is pre-taxed, meaning it also has tax advantages. The money in your HSA builds up over time, and you’re allowed to use it indefinitely, even after switching health plans. The restriction is that the contributions you make are only tax-free when you’re enrolled in a High Deductible Health Plan (HDHP).⁶
5. Paid time off
While not required by law, many employers offer employees some form of paid time off (PTO) to remain competitive with other companies. Paid time off is any time when you aren’t working but still receiving pay. This can include paid vacation time, personal days (as differentiated from required sick leave), and company holidays.
Your company can separate PTO time by vacation, personal, and sick days, or they might bundle it, which means there’s one bank of paid leave you can use. Make sure you’re aware of your company’s PTO policy and if you have to use it all in a calendar year or if you can roll over unused time to the following year.
6. Tuition assistance
Some employers reimburse people for furthering their education while working at a company. These reimbursements can help reduce student loan debt for employees who qualify for these programs.
A company might offer a set amount toward continuing higher education or cover a percentage of your tuition. In either case, you’ll probably be required to stay with your company for a certain period of time after you finish your degree, so be sure to read the policy carefully.
These student loan relief programs are ultimately a win-win for employees and employers. They help lessen the financial burden of student loan debt on employees and encourage them to pursue more training – and professional development that can help both your individual career and the goals of the company you work for.
7. Remote work and flexible schedules
Remote work options and flexible working schedules are cost-effective employee benefits that have become more common since the pandemic. In fact, according to one study, as many as 62% of U.S. workplaces are offering remote work flexibility.⁷ Some companies are adopting hybrid in-office and work-from-home policies for their employees.
8. Childcare benefits
For working parents, one of the biggest obstacles is the lack of affordable childcare. And that’s no surprise: According to care.com, the average cost of childcare adds up to a whopping $18,000 per year.⁸
One way companies can support their employees is by providing on-site daycare or tuition discounts to help with childcare costs. By offering contributions toward the high costs of childcare, companies can avoid having to rehire or fill positions for those who have to leave due to this hardship.
9. Paid holidays
The law doesn’t require employers to provide their employees with paid leave for holidays. However, many employers make sure that their employees get time off for holidays to spend time with friends and family. Companies choose different paid holidays based on their own discretion.
Holidays like Christmas, Thanksgiving Day, and Memorial Day are common days off, but beyond that, other paid holidays are chosen by the employer.
