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If you’re hoping to recruit top talent, those people will also inquire about your benefits and perks package. So which benefits and perks are the most persuasive, and which ones will you be able to afford for your company? Before you can determine that, you’ll have to be able to tell the difference between the two first.
The Key Difference Between Fringe Benefits and Perks
The Difference Between the Two
So, what are the differences between perks and benefits? And which ones are most vital to your company? If overall employee compensation were a meal, salary would be the meat and potatoes, benefits would be the healthy greens, and perks would be the dessert. Still curious? Let’s dig in a little deeper.
Benefits Benefits are a form of non-wage compensation that supplement salary. Common benefits include:
- Vacation time
- Medical insurance
- Dental insurance
- Vision coverage
- 401(K), sometimes matching
- Stock options
- Gym membership
- Pre-tax transit assistance
Perks Perks are also a form of non-wage compensation, but unlike benefits, are more loosely defined and vary greatly. Their value can range from free to expensive. A sample of perks include:
- Summer Fridays
- In-office snacks
- Standing desks
- Employee retreats
- Staff dinners
- Hotel suites
- Company car
Why Benefits and Perks are Important
Alright, you know what the difference between perks and benefits are. But why are they important to your business? Among many factors, they’ll help make your employees happy, and everyone knows that happy employees are more productive. They’ll also help you stand apart from other potential employers — or at least compete on a level field with them. In fact, according to Glassdoor’s 2015 survey, a whopping 79% of employees prefer more benefits to a pay increase.
In that same survey, the top preferred benefits were health insurance, paid time off, and a performance bonus. The top perks? Flexible work schedules, employee development programs, and tuition reimbursement. When it comes down to it, research has shown better benefits motivate people who are weighing out different job offers.
Which Benefits are Best for Your Business
The types of perks and benefits you offer will also determine the type of company culture you want to promote. Take a look at companies like Patagonia which offers surf breaks, or Timberland, which offers six-month long sabbaticals to pursue meaningful volunteer work. If you have a small company, you don’t have to make dramatic gestures to show you care, either. Even an employer who offers occasional company outings is investing resources in a close-knit team — and your employees will take note.
Some company perks may be difficult or impossible to compete with (take Google’s unlimited gourmet meals, for example). However, you shouldn’t feel at a loss. There are plenty of helpful resources out there that will help you determine when your business should offer employee benefits, and to what degree you can afford them. No matter how you slice it, benefits and perks matter to employees — and they’ll make your organization stronger and more cutting-edge.
This article was written by Kristin Hoppe, Content Producer at Justworks.