What Types of Compensation and Benefits Matter Most to Employees

Let’s be honest, when you search for a job the first thing your eyes are usually drawn to are the compensation and benefits on offer. Without the right compensation or benefits, you may find yourself swiping left on the job opportunity and moving on to the next one. This is a common story that highlights just how important it is for an employee to feel valued and appreciated for their work.

If you’re a business owner or manager, it’s your responsibility to put together a compensation package that attracts and retains top talent. The good news for you is that you don’t need to guess what employees want. There are many resources to help you, from asking your employees for feedback to researching online.

In this article, we will take a look at the different types of compensation and benefits that exist. We will then cover how you can find out what employees desire the most. Lastly, we will highlight some real-world examples that can help inspire you.

What Types of Compensation and Benefits Are There?

When speaking about compensation and benefits, it is important to recognize that many employees value more than just take-home pay. They will likely look at the overall picture instead. This means that they will factor in all types of pay and benefits on offer.

Generally speaking, there are three main types of compensation and benefits that organizations offer. These are:

• Direct Compensation

This type of compensation is traditionally monetary. It’ll usually be salaries and wages for employees based on the work they perform. As well as this, direct compensation includes bonuses for performance above expectations.

• Indirect Compensation

This comprises of items and services that help employees financially. This can include paid leave, insurance, healthcare offerings, and other items.

• Retirement Compensation

Retirement compensation refers to any funds or accounts that are set up for employees by the organization, such as 401Ks. It is intended for retirement or investment purposes.

Which Compensation and Benefits Do Employees Desire the Most?

Obviously, there isn’t a one-size-fits-all answer to knowing which compensation and benefits employees desire. Every person is different and their needs aren’t the same. With this in mind, let’s go through some of the most popular compensation benefits that employers offer.

• Health Insurance

Health insurance and other medical coverage are top priorities for many people. Providing a quality health plan to your employees can help display that you care about them while also giving them peace of mind and financial security in case of any medical emergencies. Access to additional benefits such as mental health services, dental coverage, and vision coverage, can be pivotal in the decision-making process of taking a job for many employees too.

• Retirement Plans

Many employees appreciate the stability and security that a retirement plan can provide. They know that their future is being taken care of and some retirement plans come with matching contributions from their employer. Retirement plans also offer tax benefits that many employees find attractive when negotiating compensation packages.

• Paid Leave

Paid time off is an important perk in helping an employee have a healthy work-life balance. Vacation and personal days give your employees time to recharge and come back energized. There are many ways to calculate how much PTO an employee has, from years of service to the type of job. Take the time to find out what method will work best for you.

• Professional Training or Development Programs

Many employees highly value opportunities for them to progress and advance both academically and professionally. Programs can include tuition reimbursement, as well as education opportunities such as workshops, seminars, and internal training programs. This is attractive to employees as it shows you want to invest in them and their future.

• Flexibility

It is becoming more common than ever since the pandemic to offer your employees more opportunities for flexibility. This includes working hours, as well as location. Talk to your employees to see what they feel works best for them.

• Wellness Packages

Wellness packages are a great benefit to offer to employees. These are designed to keep employees healthy and encourage them to take care of themselves and their families. Wellness packages include gym memberships, stress management programs, employee assistance programs, as well as many others.

• Free Food and Drink

Providing food and drink to employees for free will save them money and time. The drinks you provide include juice, tea, and coffee, while the food you provide can be snacks or lunch. Everyone enjoys free things and this is especially true when it comes to food.

Examples of Unique Compensation Benefits Offered by Organizations

Now that you have seen some benefits that organizations offer, you can begin to think about what you can offer your employees. If you are struggling for inspiration, many organizations offer unique benefits to their employees. Here are some examples of what can be offered:

• Google

Celebrity talks, cooking classes, massage therapists, and a number of onsite wellness centers are just some of the perks employees at Google receive.

• Airbnb

Airbnb offers an extensive number of benefits including generous leave policies and paid volunteering time.

• Ben & Jerry’s

Although this benefit may not benefit you in the long run, Ben & Jerry’s rewards its employees with three pints of ice cream every day.

• Apple

For those who love giving to charity, the Apple Matching Gifts Program has been put in place to match donations one-for-one with no minimum, at up to $10,000 per year.

• Thrive Global

This media company has a wellness room on-site which includes a nap pod for employees to catch up on sleep.

Conclusion

Every organization has the freedom to choose which compensation benefits matter most to them and their employees. Don’t be afraid to get creative but ensure that what you will offer is of value to current and future employees. Whether you choose traditional incentives or not, the benefits package needs to meet the needs of your employees to be effective.