Beyond the Paycheck – Exploring the Trends in Workplace Benefits

Employees who feel cared for at work are 3.2x more likely to be happy at work, according to LinkedIn’s Employee Wellbeing Report.

What does this mean for businesses worldwide?

Ideally, they should focus on creating a sustainable workforce that transforms our perspective on employees from mere resources to be used when needed into genuinely cared for, protected, and nurtured individuals.

As the folks at the IBM Institute for Business Value put it, “To build an engaged workforce, it is more important than ever to understand and act upon employee ideas, needs, and concerns.”

One strategy that helps with boosting employee engagement relates to benefits. Workplace benefits empower employees and enhance their engagement and well-being, and, at the end of the day, can boost loyalty. Whether discussing health, wellness, financial well-being, or professional development opportunities, each option contributes to employee satisfaction and motivation.

In essence, empowering benefits not only support individual growth but also cultivate a thriving, engaged, and resilient workforce.

So, in this article, we’re digging deep into the topic of workplace benefits, so follow us if you want to:

• Understand how benefits, stipends, and reimbursements work,
• Get a list of the most popular benefits out there,
• Get a glimpse at the latest trends in benefits management,
• Find out which are the most popular non-monetary perks out there,
• Find inspiration from real-life companies such as Ernst & Young, Adobe, or Starbucks.

Let’s get going!

How benefits, stipends, and reimbursements work

The era of attracting employees solely with healthcare and extra vacation days in compensation packages is a thing of the past.

In today’s workplace, employees face growing challenges in their personal and professional lives, and they look to their employers for comprehensive support and understanding.

Employees want to know which companies

• can support them with child care,
• can help them keep a healthy work-life balance,
• have proper health care benefits,
• offer long-term benefits like life insurance from a top provider,
• offer commuter benefits,
• allow hybrid or remote work, and so on.

This is why companies should focus more and more on crafting proper benefits strategies.

And there’s a keyword here – “personalization.” One-fits-all doesn’t work anymore. When you offer benefits tailored to your employees, it shows you care about each team member. This makes people happier and helps them stick around while boosting your brand.

If a proper benefits strategy is in place, then there’s a win-win for both the company and its employees.

Now, let’s see which are the major benefits packages available out there:

• Core benefits. These include social security (including retirement and disability benefits), unemployment insurance, and sick leave. These benefits have specific requirements based on the company/employee location.
• Health benefits. Such benefits include medical coverage, dental and vision coverage, counseling services, health savings and spending accounts.
• Financial benefits. Such benefits include company-sponsored retirement plans, life insurance, stock options and equity plans, and more.
• Lifestyle benefits. Childcare benefits, pet benefits, food benefits, wellness and fitness stipends, paid time off, fertility support, maternity and paternity leave, etc.
• Other work-related benefits include commuter benefits, work-from-home stipends (that can even cover internet expenses or office equipment), training and development stipends, etc.

The benefits from A to D are also known as fringe benefits.

Now, I’ve mentioned stipends earlier. Stipends refer to fixed sums of money given to employees dedicated to cover expenses for various purposes.

Example: Your organization could provide a set amount, like $100 monthly for commuting expenses, $75 for educational resources, and $60 for wellness activities, allowing employees to tailor their benefits to their specific needs.

Stipends can leave more room for personalization. Flexible stipend allowances empower employees to decide on the most suitable options, be it a gym membership, charitable giving, co-working expenses, or cycling gear.

Here’s an example from Buffer.  When Buffer started analyzing their employees’ stipend usage, they noticed their people were using many different platforms to learn: Lynda, Udemy, books, tutorials, and more.

Only a few employees would have been happy if they had offered Udemy or Audible memberships. But stipends allowed for personalization and happier employees.

Now, the folks at Compt compiled a list of the most popular stipends. You can use it to build your own strategy:

• Health & wellness stipends,
• Learning & development stipends,
• Remote work stipends,
• Meal plan stipends,
• Travel and/or experience stipends,
• Family stipends,
• Cell phone stipends,
• Equipment stipends.

Now, there’s another topic that needs to be covered when discussing benefits – reimbursements. What do they refer to? Employers can choose to reimburse certain employee expenses.

Stipends are fixed amounts of money an employer provides to cover specific expenses, while through reimbursements, the employer covers only the cost of that expense and no more.

There can be several eligible expenses.

Adobe, for example, can reimburse expenses related to pet care, fitness trackers, wellbeing classes, learning subscriptions, and more—as in 20+ more. The eligibility varies by country and level of taxation.

In their Lifestyle Benefits Benchmarking Report: Emerging Trends in 2024, Compt has made a list of top reimbursement claims. As you can see, wellness and food reimbursements accrue 37% of the money spent.

What the report also notices is the amount of the expenses.

Food and health and wellness are popular spending categories, but their average

claim amounts are less ($79 and $109, respectively). Caregiving claims, on the other hand, amount to higher sums, with an average of $203 claim size.

Now, a personalized stipend program should allow employees to allocate funds towards areas where costs are higher, such as caregiving, personal travel, and technology.

Low budget? Check these non-monetary perks

In the previous chapters, I talked a lot about monetary perks.

But companies can come up with an offering of non-monetary benefits as well. Here are some examples:

• Remote work, hybrid work, and flexible work arrangements

Allow employees to choose their work arrangements, including remote options, compressed and hybrid schedules, flexible working hours, etc. Your workforce values location and schedule flexibility, and these options contribute to improved morale, work-life balance, and higher loyalty and performance.

• Additional time off

Offering extra paid time off is a cost-effective perk that boosts employee morale and well-being. Consider benefits like additional vacation days, birthday day-off, etc.

• Career development opportunities

Commit to employees’ self-actualization by investing in their learning and advancement. Provide abundant internal growth opportunities, such as job rotations, lateral moves, stretch assignments, and mentorship programs. This approach prevents stagnation and disengagement and enhances their market value, creating a mutually beneficial scenario for both parties. In Tidaro, for example, we have 16 hours of self-development a month. This means we could use this time to learn a new skill, read books, etc.

• Volunteering days

Some companies allow their employees to take several days off a year to enroll in volunteering activities. Volunteering gives employees a sense of purpose and fulfillment, contributing to higher job satisfaction and engagement. It fosters a positive company culture by promoting shared values. Volunteering allows employees to contribute to social causes and positively impact their communities. It aligns the company with philanthropic efforts, showcasing corporate social responsibility.

Benefits: Statistics to guide your own packages

Back in 2022, MetLife surveyed to understand employees’ approach towards benefits.

They conclude that in today’s workplace, employees have higher expectations from their employers, with a growing list of benefits they deem essential. Health and wellness programs, policies supporting work-life balance, and flexibility have seen the most significant rise in interest since before the pandemic. A considerable number of workers now see these offerings as crucial factors when evaluating potential new jobs.

Another conclusion is that benefits represent one of the largest gaps between what employees want and what employers offer when trying to attract and retain talent. Data shows that besides the salary, candidates focus more on the benefits package, the flexible work arrangements, and health and wellness programs.

If we went even further, we found out that some of these benefits significantly impact the long term. For example, the focus on ensuring the physical and mental well-being of employees can translate into employees who are:

• Happier,
• More productive,
• More likely to be loyal to the employer,
• More likely to feel engaged.

Gallup research also revealed that when your employees are doing well, it helps your company. They take fewer sick days, work better, and don’t get tired or leave as much. But if your employees aren’t doing well, it can hurt your company’s success because lack of well-being means less engaged employees.

And this is translated into higher expenses, as shown below:

Without a satisfying job and a fulfilling career, overall well-being suffers. However, when organizations actively focus on well-being and engagement, the positive effects build up, benefiting employees and business outcomes.

Here are the risks that employees who do not thrive are facing: burning out, increased rates of stress, worry, sadness, and anger.

At the end of the day, organizations should pay attention to the culture, purpose, flexibility, and other aspects of the employee experience, using benefits and programs to reinforce them.

Inspiration from Ernst & Young, Adobe, and Starbucks

Enough with the theory; let’s go into some practical examples, shall we?

1. Adobe’s workplace benefits

I’ve mentioned Adobe’s rich benefits program earlier. Let’s go deeper a bit.

Adobe has a one-of-a-kind website dedicated to employee benefits. The website is highly localized, and employees and candidates can select their own country to review the benefits offered.

Adobe is offering a wide benefits range, grouped in 4 large categories:

• Vacation and holidays:
• Wellbeing reimbursement (e.g., pet care, memberships, subscriptions, financial planning services, wellbeing apps, art and hobby supplies, etc.), The reimbursements in the US can add up to $600 per calendar year. Taxes may apply.
• Life events benefits, e.g., adopting a baby, getting married, planning for retirement, etc.),
• Emotional and mental well-being (e.g., counseling sessions, headspace meditation app, etc.)

2. Ernst & Young adds commuter benefits to its Return-to-office policy

In 2022, many companies started calling their employees back to the offices. Some of them make use of benefits to lure them back.

Such is the case of Ernst & Young. The company sought to comprehend why employees hesitated to return to the office. The primary concerns voiced by the workforce included uncertainties regarding childcare and pet care arrangements, along with challenges associated with commuting.

In early 2022, EY’s Chief Wellbeing Officer Frank Giampietro devised a solution to address these concerns. Ernst & Young introduced the “EY Way of Working Transition Fund,” covering all commuting, dependent care, and pet care costs for U.S. employees. Notably, the fund allowed unlimited reimbursement requests for these expenses from all of its 55,000+ U.S. employees. Since its launch in February 2022, EY has observed a remarkable 150% year-over-year increase in the time employees spend together in the office, as reported by Giampietro.

Now, what other benefits caught our attention?

• US salaried employees receive up to 10 days (up to 80 hours) of paid time off each calendar year for personal care when they cannot work due to the need to care for family members.
• Learning opportunities (e.g., EY Tech MBA programs, EY Academy of Business, Counseling Academy, Corporate access to Udemy, goFluent, getAbstract educational services, English Speaking Club with a native speaker, etc).
• Health and insurance (e.g., medical insurance, life and accident insurance, travel insurance, corporate insurance tariffs for relatives, days of health, etc.)
• Wellness programs (e.g., running club, football & volleyball teams, events and New Year presents for children, presents for new-born children, etc.).

You can check their Better You website to learn more about how Ernst & Young is crafting its benefits packages.

Let’s not forget that Ernst & Young was listed on FORTUNE’s “100 Best Companies to Work For®” for 25 consecutive years.

3. Starbucks: Empowered to “Live Life Well”

Live life well seems to be Starbucks’ goal for its employees.

Their benefits are pretty transparent on their website:

• Health coverage (dependent care included),
• Stocks, retirement plans, financial wellbeing,
• Paid time off,
• Education and student loan management,
• Commuter benefits.
• Partner assistance,
• Other perks include in-store discounts, Spotify subscriptions, care.com memberships, an on-site gym, daycare and dry cleaning, etc.

Now, this list is purely informative and can serve as inspiration.

Companies need to start with their employees’ needs and personalize their benefits packages. There are tools that can help (Compt, PeopleKeep, etc) you get the best from your benefits and stipends program.

Conclusions

Employers must gain a thorough understanding of the diverse needs within their workforce. This involves considering various perspectives, such as race, generation, salary level, family circumstances, and job roles.

MetLife research identified five crucial areas that foster workforce thriving during disruptive periods and create common ground among employees:

1. Meaningful work
2. Flexibility and work-life balance
3. Social and supportive cultures
4. Career development and training
5. Wellness programs and benefits

Now, here are the steps that can be taken when crafting a personalized benefits strategy:

1. Establish a clear goal, whether it’s enhancing employee retention, attracting top talent, or fostering overall satisfaction. Tailor your efforts for desired outcomes.
2. Survey your employees through a needs analysis to understand their preferences and requirements.
3. Establish a budget that aligns with your objectives and is sustainable for your organization in the long run.
4. Clearly communicate the program’s purpose and align it with your company’s values. Foster engagement by welcoming questions and feedback to ensure understanding.
5. Have a data-driven approach to assess the program performance and identify any disengagement or high utilization patterns. Seek input from employees as well, in order to uncover the areas for improvement.
6. Share success stories to celebrate the positive impact of stipends on employees and encourage other employees to participate.

What else does 2024 have in store for us?

Companies that combine recognition programs with lifestyle benefit stipends experience increased engagement. This approach enhances employee interaction with stipend programs and raises awareness of various offerings. As organizations integrate sustainability into their core values, adopting ‘green perks’ in recognition programs goes beyond being a trend; it signifies a profound organizational dedication to global well-being.