Employee benefits: A guide for 2025

Full-time employees spend 40 hours or more a week at work—shouldn’t it be a positive experience? Nowadays, people are motivated by more than just a salary, with MetLife reporting that people have more benefit requirements now than they did before 2020.

Employees value benefits like time off, health insurance, and retirement plans, so employers looking to improve their employee experience (EX) should take note. Below, we’ll cover required employee benefits, best practices for implementing a benefits package, and 29 employee benefits ideas that can motivate staff.

More in this guide:

• Why are employee benefits important?
• 7 types of employee benefits
• Employee benefits required by law
• Fringe employee benefits
• Best practices for offering benefits to employees
• Frequently asked questions
• Simplify employee benefits with an internal help desk

Why are employee benefits important?

Employee benefits are important because they can help foster a positive employee experience (EX), which, in turn, can create a better customer experience. For example, a healthy, well-rested customer support rep with unlimited paid time off will likely provide better service than a burnt-out rep who’s out of PTO.

Employee benefits add value to an employee and their work experience. Desirable features like free coffee, employee discounts, time off, and health insurance are all examples of employee benefits.

In addition to a competitive salary, a good benefits package attracts new talent, reduces employee turnover, creates a sense of loyalty, and promotes engagement.

7 types of employee benefits

Employee benefits can’t fix employee stress, but they can offer support. It’s good to offer various benefits to help with different employee needs. There are seven main categories of employee benefits:

• Financial and retirement: contributes to retirement savings or financial well-being
• Insurance: provides insurance coverage
• Time off and leave: allows employees to take paid or unpaid days off
• Health and wellness: provides health insurance and promotes healthy habits
• Professional development: creates opportunities for the employee to learn professional skills
• Social impact: helps the employee contribute to social causes
• Workplace flexibility: creates a flexible work environment

Employee benefits often fall into one of these seven categories, whether it’s a benefit required by law or not.

Employee benefits required by law

There are certain benefits protected by federal law in the United States. While some employees are exempt, most jobs must offer the following benefits.

1. Minimum wage

Benefit type: Financial and retirement

The federal minimum wage in the United States is $7.25 an hour, although it’s lower if you earn tips. Some states have a higher minimum wage. If this is the case, you must pay employees the state’s higher minimum wage.

2. Overtime pay

Benefit type: Financial and retirement

Overtime pay is when employees get paid more than their hourly wage for any time worked past 40 hours a week. This rate must be at least 1.5 times more, commonly called “time and a half,” than the hourly rate.

3. Family and Medical Leave Act (FMLA)

Benefit type: Time off and leave

FMLA allows employees to take up to 12 weeks of unpaid leave within a 12-month period to care for themselves, a child, or a family member with a serious health condition. During this time, the workers’ employment is protected, and they still receive healthcare benefits. This leave is extended to a 26-week maximum if the employee is caring for an injured service member. FMLA also protects parental leave.

4. Unemployment insurance

Benefit type: Insurance

Unemployment insurance helps workers pay for necessities while looking for another job if they get laid off. State and federal taxes fund these payments. Some workers aren’t eligible for unemployment, such as self-employed people, those who quit their previous jobs, or students.

5. Consolidated Omnibus Budget Reconciliation Act (COBRA)

Benefit type: Insurance

COBRA allows workers to continue to receive healthcare benefits from their previous employer while looking for other coverage. Workers commonly use COBRA when they get laid off and don’t yet qualify for coverage from their new employer.

6. Workers’ compensation

Benefit type: Insurance

Workers’ compensation covers employees who get sick or injured while at work. This benefit typically includes continued salary payment and healthcare cost coverage while the person is on leave. Employees who accept compensation can’t sue the employer over the injury.

Fringe employee benefits

Fringe employee benefits are benefits or perks businesses offer employees in addition to those required by federal law.

Below, we cover some popular fringe benefits to consider.

7. Employee discounts

Benefit type: Financial and retirement

Some companies offer employee discounts. This can be discounts on the company’s product or service, or the employer may partner with other companies to get exclusive discounts.

8. Friends and family discounts

Benefit type: financial and retirement

Some employers will extend their discounts to an employee’s friends and family. There’s usually a limit on how many individuals can take advantage of this benefit, or friends and family might get a different discount than the employee.

9. Commuter benefits

Benefit type: Financial and retirement

Commuter benefits incentivize employees to take public transportation to get to work. Typically, employers offer a transportation stipend or an employer-sponsored public tra3nsportation pass. Some employers will also cover the cost of hiring a car service to get employees home if they work overtime, though it’s not as common.

10. Childcare benefits

Benefit type: Financial and retirement

For employees with young children, childcare can get extremely expensive. Some workplaces will offer a monthly childcare stipend or have a childcare center, so employees don’t need to worry about making other arrangements. This benefit for working parents also reduces sudden changes in agent scheduling if the parent unexpectedly needs to find a babysitter or make other childcare arrangements.

11. Relocation assistance

Benefit type: Financial and retirement

Relocation assistance helps employees cover moving costs if they need to relocate for their jobs. This can help cover the cost of storage, a moving company, transportation, and temporary housing while the employee looks for a permanent dwelling.

12. Tech and equipment reimbursement

Benefit type: Financial and retirement

For employees who work from home, tech and equipment reimbursements ensure they’re not paying out of pocket for the equipment they need to do their work effectively. This usually covers a computer, desk, and chair. Depending on the company and role, employers might also cover software or other tools. If your business has a call center, for example, you may reimburse your team members for purchasing the headset of their choice.

13. Compensation bonus

Benefit type: Financial and retirement

Bonuses are one-time payments employees receive outside of their regular pay. These can be performance- or commission-based. Some other types of bonuses include sign-on bonuses or bonuses for recommending a candidate who gets hired.

14. Pension plan

Benefit type: Financial and retirement

Pensions are a type of retirement plan where the former employee receives a set amount each month after they retire. This monthly payment amount depends on the number of years the employee worked and their salary. While pensions aren’t that common, they’re reliable because payments are predetermined and consistent.

15. Retirement plan

Benefit type: Financial and retirement

A retirement plan helps employees pay for their expenses when they retire. The most common type of retirement plan is a 401(k). Often, the employee contributes a percentage of their income while they’re employed. The 401(k) account then gets invested. Typically, the 401(k) provider offers different mutual options that the employee can invest in. Once the employee retires, they can access their retirement fund.

16. Life insurance

Benefit type: Insurance

Life insurance pays an employee’s surviving family if the employee passes away while the insurance plan is active. The family can use this payout to cover medical debt, burial expenses, or day-to-day costs. Employees can enroll in life insurance through their employer.

17. Private healthcare

Benefit type: Insurance

According to the Affordable Care Act, employers with 50 or more employees must provide health insurance that covers basic needs. However, employers may offer private healthcare plans with more coverage and shorter wait times than public plans. Some employers will pay for a portion of employees’ plans, which helps pay for doctor visits, medications, and hospital stays.

18. Disability benefits

Benefit type: Insurance

While requirements vary by state, disability benefits help cover expenses for employees who can’t work because of a serious illness or injury. Unlike workers’ compensation, disability benefits cover accidents that may occur outside of the workplace.

19. Paid time off (PTO)

Benefit type: Time off and leave

Paid time off allows employees to take a day off for personal reasons without missing out on pay. Some states require certain types of PTO, such as sick leave. Typically, employees are allotted a certain number of days per year for PTO or need to accrue time off based on how many hours they work.

Unlimited PTO is becoming more common. With this benefit, employees can take as many days off as they’d like as long as it doesn’t negatively impact their performance. Time off is essential for creating a better employee experience in healthcare or any other stressful industry.

20. Parental leave

Benefit type: Time off and leave

Parental leave is offered to new parents to recover and bond after having a child and to those adopting or fostering children. However, in the United States, it varies by employer whether or not this time is paid or unpaid, with some states having additional leave mandates. For example, the California Family Rights Act (CFRA) authorizes eligible employees to take up to 12 weeks of paid or unpaid leave to bond with a new child.

21. Floating holidays

Benefit type: Time off and leave

Floating holidays are days off offered in addition to PTO and company holidays. Employees can take these days whenever they’d like and don’t need to “earn” them like other PTO benefits. Encourage employees to plan for floating holidays or reserve them for emergency cooldowns after dealing with an angry customer. Time off to decompress is essential for a happy workforce.

22. Sabbatical

Benefit type: Time off and leave

A sabbatical is a type of long-term leave from a job. This offering is very common at universities, where professors can take sabbaticals to conduct research or write. Sabbaticals can be paid or unpaid and are typically awarded to employees who’ve stayed at the same company for several years.

23. Free meals and snacks

Benefit type: Health and wellness

Whether working in the office or remotely, free meals or snacks to fuel employees are always appreciated. In the office, this might look like a fully stocked break room. For employees who work from home, this might be a stipend or a gift card for a food delivery service.

24. Employee assistance program (EAP)

Benefit type: Health and wellness

EAPs offer extra support, like counseling, for employees to deal with personal and/or work issues. Depending on your business, these programs provide confidential support, and you can offer them online or in person. EAPs are an essential tool that helps you care for your team and prevent burnout.

25. Training and development

Benefit type: Professional development

Many companies offer training programs and development opportunities so employees can expand their certifications and skills. These may include employer-sponsored training sessions or classes, time off to attend conferences, or a stipend to purchase learning materials such as digital guides. Keep your offerings relevant to employees’ roles. For example, your business might offer customer service training opportunities to your support team.

26. Tuition assistance

Benefit type: Professional development

Tuition assistance is another benefit that helps employees further their education. For example, employees and their families receive deeply discounted or free tuition at many universities. Meanwhile, other companies may pay for or contribute to an employee’s education if they sign a contract to stay at that company for a set amount of time.

27. Donation matching

Benefit type: Social impact

Another popular fringe benefit is donation matching. When employees donate to a cause of their choice and submit the proof, the company will match the donation.

28. Work from home

Benefit type: Workplace flexibility

Working from home cuts down on commute time and food expenses. Working from home may not be for everyone, but many people enjoy working comfortably in their living space. For example, some call center employees might love getting up and walking around while on a call—you can’t do that in a cubicle. More control over work habits translates to happier employees and less call center burnout.

29. Flexible hours

Benefit type: Workplace flexibility

Offering flexible hours is another great benefit that gives employees more freedom over their schedule. This benefit allows employees to start their days earlier or later, depending on their preference. They don’t work fewer hours, just at different times throughout the day.

Best practices for offering benefits to employees

When offering employee benefits, follow these best practices:

• Make it easy to contact HR for questions: Your HR department is the first point of contact for employee benefit questions. They should know the benefits package from top to bottom.
• Create an internal knowledge and resource base: Self-service options allow employees to learn more about employee benefits independently. Zendesk for HR, for example, makes it easy to set up an internal knowledge base and helps keep HR’s workload manageable.
• Host a town hall: Give employees space to ask questions in person or on a video call.
• Collect feedback: When in doubt, ask your employees what they need. Try an employee engagement survey to help measure the impact of the benefits.

A thoughtful employee benefit rollout can help employees enroll in and get the most out of their benefits. Generally, simplifying the enrollment process as much as you can and educating employees on their options will create a better experience.

Frequently asked questions

Simplify employee benefits with an internal help desk

When you offer the employee benefits your team values most, you unlock the potential to improve employee satisfaction and EX. Set up an internal help desk with Zendesk so employees can easily connect with HR regarding their questions about benefits and access self-service resources like knowledge bases as they navigate the onboarding period.