Various forms of fringe benefits are often provided to employees in the form of non-wage or salary compensation as well as various kinds of non-cash benefits. In cases where an individual exchanges salaries for any other form of fringe benefit, this is usually referred to as a “payout” or “cash bonus” agreement. There are various fringe benefit plans that are offered by most companies during annual general meetings and periodic raises and promotions. The terms, amount and structure of these agreements vary from company to company and dependent upon the type of plan, the number of employees and the terms of the employment. In this article, we’ll take a look at a few common types of fringe benefits, how they’re used and why they’re important to have in a corporate organizations history.
The most popular of all fringe benefits is a golden parachute payment. These parachute-type payments are usually paid, as part of an employee’s final retirement package, when a company makes a redundancy. Generally, the golden parachute benefit is equal to one year of service in the particular company. Companies use this type of employee benefit when they believe one of their own has reached retirement age and would be able to continue to contribute to the business, but would need financial assistance for doing so.
Another popular form of fringe benefit is an increase in the length of service or tenure with the company. This type of benefit can also be included as an incentive or reward for a long and successful career with the company. Most often, this type of arrangement is made between an employee and his/her current employer. However, it is also sometimes made voluntarily by an employee if circumstances have arisen that would require an extra level of commitment on the part of the employee to the business. In such instances, the employer will pay a specified amount of money to the employee to compensate for this additional level of commitment.
Other fringe benefits are provided to employees to encourage loyalty and to further promote their productivity. Generally speaking, these benefits do not include any increase in salary or wage; however, these benefits may come into play when an employer feels an employee needs them to perform better at his/her job. In addition, a company may provide an incentive for an employee to take a higher position or hold a certain position, such as managerial or executive positions, by offering periodic bonuses based upon performance. Again, these are not regular wages, but are cash bonuses paid as a reward for a job well done.
One last type of fringe benefits are benefits that a company provides to its full-time, permanent employees. fringe benefits include health insurance; paid holidays; paid parental leave; paid paternity leave; paid maternity leave; paid relocation expenses; and other similar benefits. When an employee joins a company, he should make a start toward finding out what kinds of fringe benefits are being offered to him. Most human resources departments have a handbook that can be used to find out the details of any benefits being offered.
As you can see, there are a lot of different fringe benefits being offered to employees. This is actually very beneficial for employees because they can receive these benefits, knowing full well that these benefits will help them grow and succeed in their careers. And even though some employees may object to the idea of giving benefits to employees, it is often best to give incentives for doing a good job and keep them happy in the process.