What are non-mandatory benefits

Non-mandatory benefits, often called voluntary or optional benefits, are extra perks that employers choose to give their employees, not because the law requires it, but as an added bonus. These benefits, which can include both financial and non-financial rewards, are available to both part-time and full-time staff.

Employers offer a range of non-mandatory benefits to improve the workplace experience and address the varied needs of their employees. These perks, which can be tailored to the organization's size, location, and the individual preferences of its workforce, span categories like smarter working, health and wellness, work-life balance, and financial security.

The advantages of non-mandatory employee benefits include:

• Enhancing work environment: Smarter working benefits like flexible schedules and work-from-home stipends make the daily routine more enjoyable and productive.
• Supporting well-being: Health and wellness benefits extend beyond mandated healthcare to include mental health services, fitness classes, and more, supporting overall employee well-being.
• Improving work-life balance: Benefits like transportation subsidies, childcare support, and unlimited PTO help employees manage their personal and professional lives more effectively.
• Attracting and retaining talent: Offering a comprehensive benefits package can make a company more attractive to potential employees and encourage current staff to stay, contributing to a positive company culture and reduced turnover.
• Tax advantages: Many non-mandatory benefits are tax-deductible for employers, providing financial incentives to offer these perks.

Common types of non-mandatory benefits

In the United States, employers can include a wide variety of perks in their employee benefits packages. The objective for each organization is to meet employees’ needs, which vary depending on size, location, remote vs. on-site, and personal preference. Most organizations offer perks in these areas:

• Smarter working

• Health and wellness

• Work-life balance

• Financial security

Smarter working benefits

Employers, including small business owners, offer smarter working benefits to make the workday more pleasant and productive. These benefits can include:

• Flexible working arrangements

• Skills development opportunities

• Free meals and drinks

• Group activities and gift exchanges

• Work-from-home stipends

Health and wellness benefits

Although some benefits associated with health are mandated in many countries, more companies are offering additional perks to support employees’ mental health and physical well-being, including:

• Gym memberships

• Mental healthcare

• Life and career coaching

• Yoga or dance classes

• Chiropractic sessions 

• Fertility treatments 

• Comprehensive packages (mental, physical, and financial wellness programs)

Work-life balance benefits

Lifestyle benefits support employees and help them achieve better work-life balance, reducing stress and burnout. You can make your team members’ lives easier by helping with:

• Gas or transportation costs (if employees must commute)

• Grocery delivery

• Childcare

• Legal services

• Unlimited paid time off

Financial security benefits

Financial perks resemble traditional benefits, like health insurance and paid time off. They help employees stay financially secure, even if they can’t work for some time. Companies can also get discounts from vendors if they shop for large teams. The following perks take a considerable burden off their budget:

• Vision insurance

• Dental insurance

• Life insurance

• Paid parental leave

• Sick leave (which isn’t required by the FMLA)

• Pension plans: defined benefit plans and defined contribution plans

• Retirement plans (401k or employee-sponsored IRA)

• Legal advice around saving and loans

Why offer non-mandatory benefits to your employees?

A well-thought-out benefits plan helps you stand out among other companies and attract the most qualified workers. An attractive plan also benefits employers by improving employee experience, motivating workers to stay with your company, and enhancing work-life balance. Many fringe benefits are tax-deductible for the employer.

The 2020 Society for Human Resource Management (SHRM) Benefits Survey surveyed over 2,000 HR professionals to create a list of the most valuable benefits.

According to 90% of respondents, healthcare is the most important, followed by flexible work and generous leave policies. 

• Healthcare: 90%

• Flexible work: 83%

• Leave: 83%

• Family-friendly: 76%

• Wellness programs: 62%

• Retirement: 55%

Benefits attract top talent

People evaluate a company’s benefits package in addition to its compensation package and company culture. The set of perks gives employees something to get excited about. They also demonstrate your dedication to employee well-being and your financial stability.

Voluntary benefits contribute to work-life balance (and reduce burnout)

Benefits such as flexible working hours allow employees better time management and work scheduling. Companies that nurture an employee-first culture rarely deal with employee resignations.

A company that offers gym memberships and healthy free meals encourages employees to adopt healthy habits and prioritize maintaining their physical and mental health. These healthy habits improve focus and motivation, and decrease stress and burnout.

What are the mandatory benefits in the United States?

In the United States, there are federal laws and labor laws that require employers to offer a handful of benefits. The Affordable Care Act (ACA) requires employers with 50+ employees to offer health insurance to full-time employees. All employers must also provide workers' compensation insurance, unemployment insurance, social security, and medicare

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