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25 Types of Employee Benefits

By Indeed Editorial Team

Updated February 22, 2021 | Published April 17, 2020

Updated February 22, 2021

Published April 17, 2020

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Most employers offer employee benefits packages, which can include basic health coverage and retirement planning. In addition to basic health coverage, employers offer a variety of other perks, depending on the nature of their companies. It can be worthwhile to find out what your employer offers in terms of benefits packages, especially if you are taking on a new position. In this article, we discuss the basic types of employee benefits and additional perks for you to explore.

What are employee benefits?

Employee benefits include non-wage compensation in addition to regular salary. Various types of employee benefits typically include medical insurance, dental and vision coverage, life insurance and retirement planning, but there can be many more types of benefits and perks that employers choose to provide to their employees.

Additionally, many of the benefits employers provide are reserved for full-time employees, though it is not that uncommon to find benefits packages available to part-time workers.

Read more: Everything You Need to Know About Part-Time Employee Benefits

Types of employee benefits and perks

Many companies offer some of the following employee benefits and perks:

• Medical coverage

• Dental insurance

• Vision insurance

• Life insurance policies

• Prescription and pharmacy benefits

• Specialist services

• Mental health coverage

• Retirement planning

• Paid time off

• Paid vacation time

• Paid sick leave

• Extended leave

• Family leave

• Disability benefits

• Workers’ compensation

• Living stipends

• Student loan repayments

• College grants and scholarships

• Paid training and development

• Continuing education

• Travel and spending expenses

• Company equipment

• Company transportation

• Remote work flexibility

• Investment opportunities

Medical coverage

The most common employee benefit that employers offer is medical or health coverage. Typically, employee medical insurance covers things like doctors’ appointments, regular checkups, emergency room visits, basic medical procedures and many types of surgical procedures.

Dental insurance

Many employers provide dental coverage as part of their overall employee medical benefits, but sometimes dental insurance is a separate benefit. Depending on your workplace, you will either have a complete benefits package where medical and dental are grouped together, or you will have two separate insurance policies for both your medical and dental plans.

Additionally, dental plans generally cover routine dental exams, cleanings and X-rays and dental procedures like root canals, fillings and oral surgery.

Related: Employee Benefits: Examples of the Most Common Employee Perks

Vision insurance

Vision insurance is usually a separate insurance plan offered along with employee health benefits. Eye exams, prescription lenses, ocular procedures and routine checkups for eye health are typical procedures that a vision plan covers.

Life insurance policies

Many employers provide life insurance plans as part of an employee benefits package. Often, these life insurance policies are group-term life insurance, which means the insurer provides the employer with a master contract that extends life insurance coverage to all staff members and is in effect for a certain time period.

Usually, the life insurance term lasts for as long as the employee works for their employer. Other life insurance plans may be available depending on the employer, but group-term plans typically cost less than individual insurance policies.

Prescription and pharmacy benefits

Many health coverage plans offer prescription benefits, such as lower co-pays for medicines and even no-cost prescriptions. Many pharmacy benefits contain a plan formulary along with tiered pricing for prescription drugs. The plan formulary lists the available medications under your specific prescription plan and often includes medications necessary for chronic and acute diseases.

Additionally, most prescription plans offer three different tiers of medication prices, with generic medications in the lowest cost options. The co-pay for certain prescription drugs can vary, depending on the tier the medicine is listed in.

Specialist services

Specialist services, including referrals from primary care physicians, make up a portion of many employee benefits packages. From dermatological health services to sleep specialists, many health coverage options include coverage for non-routine specialist exams and procedures.

Mental health coverage

Some employee health plans also include mental and emotional health coverage. Depending on the insurance plan, appointments with mental health practitioners, behavioral and cognitive therapy services, grief, divorce and family counseling and prescription coverage for medications for mental disorders can be covered in your health benefits.

Retirement planning

Retirement options are available through most employers and often differ, depending on the company. Several common retirement options employers offer include 401(k) and IRA plans, 403(b) retirement plans (especially if you’re employed with a nonprofit), simplified employee pension (SEP) plans and more.

Learn more: What Is a 401(k) and How Does It Work?

Paid time off

In addition to health benefits, most employers offer paid time off, when employees can schedule personal days off of work. Typically, the amount of PTO increases by a set number of hours, which employees accrue each pay period. The number of hours accrued each period can vary between employers and is often determined by the length of time an employee has worked for their employer.

Paid vacation time

Generally, vacation time accrual is an employee benefit that may be offered in place of PTO. Employees who have vacation allowances accrue a certain number of hours each pay period, similar to paid time off allowances. The biggest difference between a PTO plan and paid vacation time is that PTO can be used for any kind of time off from work, whereas vacation allowance is only for employees to take a vacation or break away from work.

Paid sick leave

In addition to PTO or a paid vacation allowance, many employers offer sick leave. Employees accrue a set number of hours each pay period, the same as PTO or paid vacation days, but sick days are usually a separate allowance combined with paid vacation. Additionally, employers who provide paid sick leave will generally include paid vacation days in the package, and this combination of employee perks takes the place of PTO.

Extended leave

Extended leave is different from paid sick leave accrual, and it accounts for long periods away from work for medical reasons. Oftentimes, employers offer extended leave benefits that pay employees’ salaries for time off over 15 consecutive days. Employers may require employees to provide notice of their extended absence along with documentation of any medical procedures undergone during their time away.

Related: How to Request a Medical-Based Absence

Family leave

Along with extended leave, many employee benefits packages include a family leave plan. Family leave includes extended absence allowance, such as maternity and paternity leave, for when parents welcome their new babies. Depending on the employer, employees may take up to 12 weeks off of work to stay with family and their infants.

Disability benefits

Disability benefits ensure an employee’s salary in the event they are injured or become ill and cannot work. Some employers may offer temporary disability insurance plans that provide income support to employees who have suffered an injury or illness outside of work. While disability benefits can vary between employers, many offer some form of short-term disability coverage in the event you’re injured on the job.

Workers’ compensation

Workers’ compensation plans are usually part of a typical employee benefits package if they aren’t substituted with a disability benefit plan. Workers’ compensation covers accidents, illness and injuries suffered on the job, and these benefits frequently offer coverage for up to 100 weeks, depending on the plan.

Living stipends

Some employers offer living stipends as part of their benefits packages, especially if employees need to relocate in order to fill their position. Depending on the company, employees may receive monthly or yearly stipends that cover several living expenses such as moving fees, home office setup, utility coverage and even rent.

Student loan repayment

Many employees who have recently graduated from college can have outstanding student loans they need to pay off. Employers who offer student loan repayment benefits offer to pay back the employee’s student loan, usually at a set amount per month. The amount that employers contribute can depend on the loan amount and monthly payment minimum.

College grants and scholarships

Depending on your employer, you may be able to receive a grant or scholarship for college. Many employers develop scholarship programs that allow employees to return to school or finish their degrees. The amount that is awarded can differ depending on the employer, their scholarship program and how they sponsor the scholarship program.

Paid training and development

Many companies pay their employees to attend training and professional development. Additionally, new hires may typically be required to attend new employee training, which is often paid for by their employers. Another perk employers are likely to offer alongside paid training is paid professional development, where employees can attend mandatory developments without the worry of having to use their PTO or vacation days to attend the event.

Related: Do Trainees Get Paid? Your Guide to Employment Training

Continuing education allowances

Along with professional development and paid training, many employers offer paid allowances for employees who are required to obtain continuing education credit hours for their jobs. Much like paid professional development, paid continuing education can help employees avoid using up their personal or vacation time for work-related days away from the office.

Travel and spending expenses

Many businesses employ executives and professionals who are required to travel in order to complete business assignments. In these cases, employers generally cover the costs of travel, lodging and spending costs for employees who travel long distances to perform their jobs.

Company equipment

Depending on the role and industry, employers may also offer company equipment as part of their employee perks. Things like computers, cellphones and tablets may be equipment that employers provide to their employees to perform their jobs. Usually, when employers provide company equipment, employees have access to it for the duration of their employment.

Company transportation

Some companies even provide company vehicles for employees to use. This perk is common among trade industries such as construction, where employees arrive to work in their personal vehicles then use the company’s vehicles to complete their job duties.

Remote work flexibility

Many companies are starting to offer remote work flexibility perks, where employees are allowed to work from home one or more days per week. Additionally, some employers combine remote work flexibility with extended leaves or lengthy absences, whether for medical reasons or not.

Investment opportunities

Many corporate businesses and organizations offer ways for employees to invest in company stocks, shares or other profit-growing opportunities within their organization. Investing in your company means you can benefit from its growth and profitability while increasing your personal net worth.