Common Fringe Benefits
These are not compulsory fringe benefits but companies offer some or most of them to employees:
Health Insurance: Employees are required to select one plan, usually on the first day of the calendar year. The health plan is usually paid annually.
Prescription Card: Employees can take prescriptions to an approved drugstore, which send the bills to the insurance company.
Dental Insurance: The policy must delineate the preventative and diagnostic dental work covered and other dental services provided.
Life and Accidental Insurance: Life and accident policy is computed based on the salary. Employees can buy additional insurance at their expense.
Vision Insurance: The plan allows employees to choose from a preselected list of optometrists, eyewear centers, or ophthalmologists.
Disability Insurance: Disability insurance is very expensive. Many pre-existing conditions are not covered or there is a waiting period before the coverage kicks in.
Educational Assistance: Employees are reimbursed for pursuing continuing education courses. Undergraduate and graduate course expenses are also reimbursed. All courses must be approved before enrollment so they can be reimbursed.
Retirement: This is an important benefit for the future of employees.
Paid Time Off (PTO): Employees are allowed paid time off each year which is necessary to prevent employee burnout.
Extended Illness Benefit (EIB): This is part of a fringe benefits package for employees with major medical condition or who figure in an accident. EIB is available after the employee has used up all PTO.
Company Paid Holidays: On the average, state government allows 12 days and for for-profits 8 days of paid holidays each year.
Health Savings Account (HSA) or Flexible Spending Account (FSA): Employees may request a portion of their monthly paycheck as a pre-tax deduction for expenses not covered by insurance such as orthodontic work, emergency room visits, etc. The amount deducted needs to be used by year-end or the employee loses the contribution.
Profit Sharing: The company allocate some of profits to employees when the company does well.
Other Fringe Benefits: Include discounts for car loans, free/reduced rate to a health club, child care or elderly care, parking reimbursement, travel or meals for business-related work, relocation, other insurance; computers and other benefits.
The company can choose to implement any combination or all of the common fringe benefits. Fringe benefits could be a factor in retaining employee loyalty. Entrepreneurs, therefore, should give this matter due consideration.