Unsourced material may be challenged and removed. In most countries, most kinds of employee benefits employee benefits guide pdf taxable to at least some degree.
The purpose of employee benefits is to increase the economic security of staff members, and in doing so, improve worker retention across the organization. Colloquially, “perks” are those benefits of a more discretionary nature. Often, perks are given to employees who are doing notably well or have seniority. They may also be given first chance at job promotions when vacancies exist. Managers tend to view compensation and benefits in terms of their ability to attract and retain employees, as well as in terms of their ability to motivate them.
Benefits that are mandated are thought of as creating employee rights or entitlements, while discretionary benefits are intended to inspire employee loyalty and increase job satisfaction. Based on this, Klonoski proposed definitions of both discretionary and non-discretionary benefits as a manager would view them: “Discretionary employee benefits are those organizational programs and practices that are not mandated by regulation or market forces, and that improve employee performance by increasing job satisfaction or organizational loyalty. Non-discretionary employee benefits are those organizational programs and practices that are mandated by regulation or market forces, and that create an employee right, entitlement, or expectation. Viewed from this perspective, things like casual dress codes, flextime, and telecommuting can be considered employee “benefits” whether or not they produce an expense to the organization offering them.
If employees prefer to dress casually or to have flexible hours or to work from home they may be inclined to seek and less likely to leave employers that offer these things. Such group insurance plans are a top-up to existing provincial coverage. An employer provided group insurance plan is coordinated with the provincial plan in the respective province or territory, therefore an employee covered by such a plan must be covered by the provincial plan first. The life, accidental death and dismemberment and disability insurance component is an employee benefit only.
Some plans provide a minimal dependent life insurance benefit as well. Companies that offer these types of work-life perks seek to raise employee satisfaction, corporate loyalty, and worker retention by providing valuable benefits that go beyond a base salary figure. Fringe benefits are also thought of as the costs of retaining employees other than base salary. These benefit rates often change from year to year and are typically calculated using fixed percentages that vary depending on the employee’s classification. Normally, employer-provided benefits are tax-deductible to the employer and non-taxable to the employee. The portion paid by employees is deducted from their gross pay before federal and state taxes are applied. If certain conditions are met, employer provided meals and lodging may be excluded from an employee’s gross income.