Advantages and risks of fringe benefits

By definition, fringe benefits are voluntary benefits provided by a company to their employees in addition to wages. They can be both financial and non-monetary benefits in-kind. Companies have a great deal of leeway in designing them. A major point in favour of the use of such fringe benefits is the tax advantages from which both employers and employees benefit. Especially in difficult economic times, when salaries are difficult to increase, fringe benefits can be used as an incentive to keep employees motivated.

However, potential danger might be that after a certain time employees can become accustomed to fringe benefits, they become a matter of course and thus lose their effect. A discontinuation or reduction can also lead to frustration and dissatisfaction. It is important for employers to note that fringe benefits, if they are considered part of the salary, must also be paid during a leave of absence.

These are the most popular fringe benefits! 

In addition to salary, identification and sympathy with the company and opportunities for further development, financial and immaterial fringe benefits play an increasingly important role in the decision for or against a job. Fringe benefits can come from the following areas: 

Training measures 

Educational measures are probably one of the oldest company fringe benefits from which not only the employee but also the employer benefit. These include further training, workshops and visits to events such as trade fairs and conferences that are relevant to the industry.   

Mobility support 

Company support in the area of mobility is also one of the most popular fringe benefits. These can be company cars, from which salespeople particularly benefit, bicycles, tickets for public transport or other transport services, such as Uber for Business.  

Financial employee benefits 

While benefits such as bonuses, holiday pay or Christmas bonuses must be taxed, there are financial fringe benefits to which this does not apply. These include the provision of food, in the form of snacks, fruit and drinks. Meal vouchers for off-site catering are also becoming increasingly popular. 

Technical fringe benefits 

The provision of technical gadgets that can be used not only for professional purposes but also for private purposes has also been a common fringe benefit for quite some time. These can be smartphones, laptops or tablets. However, care must be taken to ensure that such benefits do not lead to exaggerated expectations of accessibility and that the work-life balance does not suffer as a result.   

Health promotion measures 

So-called measures to promote employee health are also very popular. For example, companies can finance the gym for their employees, provided they have health insurance approval. Sports offers directly in the company, company doctors, massages, vaccination campaigns and other measures, such as a smoking cessation course, are further possibilities for fringe benefits in the area of health promotion. 

Social safety 

One aspect that is steadily gaining in importance within the fringe benefits offered concerns the social security of employees. This includes all benefits that give employees - in addition to a fixed and reliable salary - security and stability in life. This can take the form of a company pension scheme, accident, disability or life insurance, which can be provided tax-free. Flexible parental leave and the assumption of or subsidies for childcare are also becoming increasingly popular as fringe benefits.  

Regular company outings and events for employees are also a form of social benefit that have the added advantage of improving team spirit and togetherness within the company.   

Employers make their employees happy with these other benefits 

Very few people today enjoy a classic 9-to-5 lifestyle. Instead, there has been a big shift in recent years towards flexibility, quality of life and also self-fulfillment. Work-life balance is lived like never before. Of course, this does not mean that people no longer enjoy their jobs or do not want to fulfill themselves professionally. It just means that people are paying more attention to a certain balance between private and professional life. Accordingly, more and more employees are enjoying benefits that enable them to lead this flexible lifestyle. These include: 

• Sabbaticals  
• Home office arrangements  
• Flexible working hours  
• Compressed working weeks  
• Animals in the workplace
  

Arrange fringe benefits individually 

Fringe benefits are becoming increasingly popular, and for good reason: carefully selected and agreed with employees, both sides benefit, which can lead to a pleasant working atmosphere. However, it is indeed important to make an individual choice and to take into account the respective life situations in which employers find themselves. After all, a childless person cannot do anything with a kindergarten place and someone who does not own a car does not benefit from a free parking space.  

The company must succeed in tailoring the fringe benefits to the individual employees. The best way to do this is to determine the needs together.