40 types of employee benefits every company should know

From health stipends to student loan repayment, this list breaks down 40 types of employee benefits companies can offer to attract and retain top talent.

When attracting and retaining top talent, salary alone isn’t enough. Today’s workforce wants employment opportunities that offer meaningful support beyond a paycheck. These extras, known as employee benefits, play a major role in shaping job satisfaction, workplace culture, and long-term employee engagement.

Understanding the different types of employee benefits can help companies build packages that meet both business goals and employee needs. Whether you're part of a fast-growing startup or managing HR at a more established organization, offering a thoughtful and tailored benefits package can make your company more competitive, improve retention, and support a healthier, more productive workforce.

Main types of employee benefits to consider

Employee benefits fall into three general categories: mandatory, fringe, and industry-standard. 

1. Mandatory benefits are required by law and typically include things like workers’ compensation and Social Security contributions. Depending on the country or state, some employers may also be legally obligated to provide things like paid family leave and health insurance.

2. Fringe benefits go beyond the legally required benefits. These are non-cash perks like gym memberships or commuter benefits.

3. Industry standard benefits fall somewhere in between. While they’re not a legal requirement, most competitive workplaces offer them. These can include benefits like health insurance, paid vacation time, and retirement plans. Not offering these types of benefits can make it harder to attract and retain employees in today’s competitive job market.

Legally required employee benefits

Legally required basic employee benefits include Social Security, unemployment insurance, and workers' compensation, which protect employees in the event of job loss, injury, or illness.

These benefits are mandated by law to ensure that employees have a safety net, contributing to overall job security and well-being. While they represent the minimum level of support a company must provide, they play a crucial role in maintaining a fair and equitable workplace.

1. Social Security and Medicare benefits

Social Security and Medicare are federal programs funded by payroll taxes. Social Security offers retirement, disability, and survivor benefits. Medicare covers healthcare for those 65 or older or people with disabilities.

2. Workers’ compensation

Workers' compensation insurance is held by the employer and offers financial support and medical care to employees who suffer injuries while performing their job duties. It helps protect employees from financial hardship and strain after workplace accidents and protects employers from injury-related lawsuits.

3. Unemployment benefits

These benefits provide short-term financial support to workers who are laid off or unemployed due to circumstances beyond their control. Employers typically fund these through unemployment insurance taxes, but they are administered at the state level.

4. Family and Medical Leave Act

The Family and Medical Leave Act (FMLA) provides eligible employees with the right to take up to 12 weeks of unpaid, job-secure leave for qualifying family or medical situations. This can include childbirth, serious illness, or caregiving. This ensures employees can take care of their critical health and family needs without the fear of losing their jobs or benefits.

Health and wellness benefits

Health and wellness benefits are some of the most sought-after perks in the workplace. These benefits typically include medical, dental, and vision insurance, but many companies are expanding their offerings to cover additional benefits like mental health support, telemedicine, and wellness stipends.

One way to strengthen your health benefits offering and make it more competitive is by exploring healthcare perks employees might not know about. The goal is to give employees access to resources that help them stay physically and mentally healthy, on and off the clock.

Offering strong employee healthcare benefits and wellness perks doesn’t just help with recruitment. It can also lead to fewer sick days, lower stress levels, and improved productivity. As more employers look to modernize their offerings, staying on top of the healthcare industry trends for 2025 is important.

Ultimately, when employees receive support for their health, they’re more inclined to feel appreciated and remain motivated in their work.

5. Health insurance

Health insurance typically includes coverage for medical, dental, and vision care. This is vital for helping employees to afford everything from routine checkups to emergency care. Offering health benefits not only supports your team’s well-being but also lightens a monetary load that can be very stressful.

6. Mental health support

Mental health benefits have been growing in popularity through the years and typically include access to therapy, counseling, mental wellness apps, and Employee Assistance Programs (EAPs). These are critical for reducing stress and preventing burnout, making for a happier and more emotionally resilient team

7. Wellness stipends

Wellness stipends are more flexible funds that employees can use for health-related expenses. They can cover things like gym classes, meditation apps, ergonomic equipment, and even wearable devices. Employees can choose how to use these stipends, making it easy for them to customize them to their unique needs.

8. Fitness memberships

This benefit typically includes full or partial reimbursement for gym memberships, fitness classes, or virtual workout classes. Investing in your team’s physical well-being will not only help your employees feel their best but can also increase energy levels and reduce health risks.

9. Dietitian and nutrition counseling

Access to dietitians and nutrition counseling helps employees make informed dietary choices that help with their long-term health. This can help your team manage chronic conditions or simply live a healthier lifestyle, both of which can lead to a happier and healthier team.

10. Telemedicine options

Telemedicine is another benefit growing in popularity because it allows employees to consult with healthcare professionals virtually. For those who don’t have access to easy or convenient in-person services, it reduces the barriers to care.

Financial and insurance benefits

Financial and insurance benefits for employees are foundational components of most employee benefits packages. These typically include life insurance, disability coverage, and retirement plans like 401(k) contributions. Some employers also offer additional financial perks, such as student loan repayment assistance or stipends for health insurance. 

These benefits help protect employees against unexpected expenses and long-term financial risks, making them feel more secure and supported. Offering flexible options can be a smart way to meet diverse needs and stand out in a competitive talent market.

11. Retirement plans

Retirement plans, such as 401(k)s, enable employees to allocate pretax earnings for their retirement savings. Employers often offer matching contributions, making this benefit that much more enticing. It’s also important to offer informational sessions to help your employees understand these benefits and make better-informed decisions for their future.

12. Life insurance

Life insurance offers financial support to an employee’s chosen beneficiaries if the employee passes away. Employers can offer basic coverage at no cost with an option to upgrade coverage for an additional fee. This can give your employees peace of mind and show them you’re invested in their future.

13. Disability insurance

When an employee can’t work because of illness or injury, disability insurance helps cover a portion of the employee’s income. There are short-term and long-term options to help reduce your employee’s financial stress while they’re dealing with unexpected health challenges.

14. Student loan repayment

Employers can help employees pay off or reduce their student loans through a student loan repayment program. Employers can choose to make recurring payments or a lump-sum payment, but will usually require the employee to be employed for a specified period of time before they’re eligible. This can help ease financial burdens and improve retention among younger talent.

15. FSA and HSA accounts

Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs) enable employees to contribute pre-tax income to cover qualified healthcare costs. FSAs are available to all and can be used to pay for out-of-pocket health expenses. HSAs are only available to those with a High Deductible Health Plan (HDHP) and also cover health-related expenses. These funds can also be invested and rolled over year to year, even when changing jobs.

16. Employee stock purchase plans (ESPPs)

An employee stock purchase plan (ESPP) lets employees buy company stock at a reduced price. This is often done by deducting funds from their paycheck over a set period. This benefit can improve retention and engagement by helping employees feel more connected to the company’s performance and growth.

Time off and leave benefits

Time off and leave benefits typically include paid vacation, sick days, personal days, and parental or family leave. Some companies also offer mental health days, sabbaticals, or volunteer time off. These benefits give employees the space to rest, recharge, and take care of personal responsibilities without sacrificing their income or job security.

Incorporating generous leave policies into your employee benefits package can help increase job satisfaction and morale. When employees feel trusted to take time off as needed, they're more likely to stay engaged, productive, and loyal to the company.

17. Paid vacation

Paid vacation gives employees a set number of paid days off a year, usually based on their tenure. This benefit encourages employees to take time off work, improving their work-life balance and helping them rest and recharge without worries of financial repercussions.

18. Unlimited PTO

Giving your employees unlimited paid time off allows them to take as much paid time off as needed, as long as their work gets done. This offers more flexibility and shows you trust your team to be responsible. From an employer’s perspective, unlimited PTO can also reduce financial liability, since unused vacation time doesn’t accrue and typically doesn’t need to be paid out when an employee leaves.

19. Sick leave

Sick leave differs from paid time off and paid vacation because it allows employees to take time off when sick or caring for a sick family member without losing vacation days. The number of sick leave days employees get can depend on the company and location. Some states have legal requirements around this, so be sure you know the laws in your state.

20. Parental leave

Many employers offer parental leave to allow new parents to spend time with a newborn or newly adopted child. These sorts of policies vary widely by employer, and can be paid or unpaid depending on factors like location and type of leave. Some states have laws that mandate paid leave, so you’ll want to be sure you know the laws in your state.

21. Sabbatical

A sabbatical is an extended break from work, which is usually paid or partially paid. This is often available to employees who have served the company for five or more years. It’s a great way to give back to long-term employees so they feel valued and seen.

22. Volunteer time off

This benefit allows employees to participate in community service or nonprofit work in their community. Employers will often give team members paid hours or days to complete this service, helping them connect to their community.

Work-life balance and flexibility benefits

Work-life balance and flexibility benefits support employees in managing their personal and professional responsibilities more effectively. These can include options like remote or hybrid work, flexible hours, Summer Fridays, and even relocation assistance. By giving employees more control over where and when they work, these benefits can reduce stress and help them maintain healthier routines.

Including these types of benefits in your employee benefits package shows that your company values employee well-being. To ensure your team understands and takes full advantage of what’s offered, focus on communicating employee benefits clearly and consistently.

23. Remote work

Remote work gives employees the flexibility to perform their duties from home or any location outside the conventional office setting. This gives workers more flexibility, saves commuting time, and can help increase satisfaction and productivity.

24. 4-day work weeks

A 4-day work week gives employees an extra day off without reducing pay. As long as employees can still meet their goals, this option can lead to increased productivity, better employee retention, and reduced burnout.

25. Flexible scheduling

Offering employees the flexibility to decide their work hours, as long as they meet deadlines and fulfill their duties, can contribute to an improved work-life balance. Flexible scheduling also accommodates differing personal needs and can boost morale.

26. Summer Fridays

Summer Fridays usually refer to shorter hours or full days off on Fridays during the summer months. This popular seasonal perk can boost employee engagement and show that you’re willing to invest in their mental well-being.

27. Relocation help

This benefit covers expenses related to relocating for a job. It can cover transportation, housing, and moving services, helping reduce the financial and logistical burden associated with relocating. This can make your employees’ transition into their new role much easier.

28. Housing assistance

This can include stipends, discounted rent, or helping employees find accommodations. This is most useful in high-cost areas or for new hires who are relocating.

Professional development benefits

Professional development benefits include resources and opportunities that help employees grow their skills and advance in their careers. These can range from access to online courses and certifications to mentorship programs and learning and development stipends. Some employers also offer in-house training, conference passes, or time off for professional growth activities.

Including development-focused perks in your employee benefits package signals a long-term investment in your team. Employees who feel supported in their career goals are more likely to stay motivated, perform at a higher level, and remain loyal to the company.

29. Online courses

Giving your employees access to online courses allows them to develop new skills or deepen existing ones on their own time. Providing subscriptions to online learning platforms shows you support their career development and continuous growth efforts.

30. Mentorship programs

Mentorship programs pair employees with experienced colleagues, offering them guidance, support, and opportunities for professional development. These types of relationships can boost confidence, improve retention, and forge deeper relationships among team members.

31. Conference budgets

This benefit will often cover travel, registration, and lodging costs for employees who want to attend industry events like conferences or workshops. Not only does this show you support your team’s growth and development, but it also helps to keep them current on industry trends and encourages innovation.

32. Learning and development stipends

Also known as L&D stipends, these provide flexible funds employees can use to take courses, earn certifications, read books, and use other training tools that aid in their growth and development. This is a more personalized version of other development benefits, allowing employees to take charge of their own growth.

33. Tuition reimbursement

This differs from student loan repayment in that this benefit helps cover the cost of college or graduate-level education while the employee is in school. This is seen as an investment in your employees’ development that also encourages them to grow with the company.

Lifestyle benefits and perks for employees

Lifestyle benefits and perks often include pet insurance, home office stipends, free meals and snacks, and discounts on products or services. These perks enhance employees' daily lives and provide added value outside of their standard compensation and benefits package. 

While lifestyle perks may not fall under core benefits like health insurance and retirement plans, they are still considered part of a company’s overall benefits offering. These non-traditional perks serve as meaningful incentives that boost morale and job satisfaction.

These lifestyle perks can play a key role in attracting and retaining talent because they demonstrate that a company cares about employees' well-being beyond just their professional needs. Employees appreciate these thoughtful extras and often consider them a key part of the overall employee experience.

34. Pet insurance

This benefit helps cover veterinary costs for employees’ pets. Pet insurance will likely only appeal to pet owners, but it does foster loyalty and supports emotional well-being by helping cover what can sometimes be heavy financial costs.

35. Home office stipends

This is an easy way to ensure your remote workers can purchase work-related equipment to make working from home comfortable. These stipends provide funds to purchase a desk, an ergonomic chair, and other work-related equipment. This can lead to more productive employees while also showing an employer’s commitment to their team’s well-being.

36. Free meals or snacks

Offering free meals or snacks in the office helps employees save money and encourages them to take breaks and bond over meals. This simple perk can improve morale, save time, and promote a positive work environment.

37. Commuter benefits

For those who commute to the office, commuter benefits can help cover the cost of public transportation and parking. This can help ease some of the financial burdens associated with getting to work and can make your company more appealing to urban commuters.

38. Employee discounts

Employee discounts include discounts on company products or partner products. These discounts can help employees save money on things they were already going to spend on, making them a great added perk.

39. Family planning

These benefits can include fertility treatments, adoption support, or access to reproductive health resources. They help employees with long-term life planning, easing some of the burden your team might feel. This can build trust with your employees and help them live more fulfilling lives.

40. Childcare benefits

Childcare support can come in different forms. This might include on-site day care, childcare subsidies, or even backup childcare services. For working parents, these offerings help make caregiving responsibilities less stressful and can reduce absenteeism in the workplace.

Why employee benefits are a must

Offering the best employee benefits isn’t just a nice-to-have anymore. They are a smart investment in your employees and your business. 

Providing your employees with comprehensive benefits helps them feel valued and supported while also keeping them motivated. This helps drive better performance and inspires loyalty. For small businesses in particular, offering competitive benefits can set your company apart in the job market.

To build a strong benefits package, understand your employees’ needs. Don’t be afraid to ask your employees questions and listen to their feedback regarding what benefits would be the most useful to them. This will ensure your team feels heard and that you can craft an employee benefits package that suits those who will receive it.

Offering a robust employee benefits package can help your company:

• Attract top talent: A competitive benefits package means you’ll stand out and draw interest from skilled candidates

• Increase employee retention: By meeting your employees' needs, you can be confident that they’ll stick around for longer

• Boost productivity: Healthy, supported employees tend to perform better

• Strengthen company culture: Offering competitive benefits signals that you care about your employees and their well-being

• Improve job satisfaction: Happy employees are more engaged and committed

• Reflect company values: Show that you live by your company values when it comes to supporting your employees

How to get benefits for your employees

Setting up employee benefits packages for small businesses may seem overwhelming, but it’s easier when you break down this large task into smaller, more manageable steps. 

Whether you’re putting together your first benefits package or expanding your current offering, the key is to stay informed and work with the right people to meet your company’s needs and budget.

It’s also important to think beyond setup. Managing benefits effectively means handling enrollment, updating employee records, communicating changes, staying on top of deadlines, and ensuring compliance over time. 

Make time to evaluate your offering every year, survey employees about what’s working or not working, and provide year-round education to ensure your team knows how to get the most value from their benefits. 

Using digital tools or working with a provider like Thatch that offers administrative support can help streamline these processes for your team. To make the process of getting benefits for your employees easier, you can follow these simple steps:

1. Set your budget: Start by understanding what you can realistically afford. While doing this, consider both the direct costs of providing benefits and the indirect costs of managing them. Some direct costs to consider include insurance premiums and employer contributions. Indirect costs of managing benefits can include legal compliance, software and tools associated with benefits distribution, and administrative time.

2. Learn what your employees value: Talk to your employees about what benefits matter most to them and what are just nice-to-haves. This will help you prioritize high-impact offerings and avoid paying for perks they’re less likely to use.

3. Understand the legal requirements: Make sure that you comply with state and federal regulations, like COBRA, ACA mandates, and required leave policies. These requirements can affect your benefits options and your budget.

4. Research your options: Explore different benefit types and providers. Think beyond just healthcare and consider everything from retirement plans to parental leave and flexible work perks. Look into how scalable and customizable each option is as your business grows. 

5. Compare plans and get quotes: Shop around for different options and combinations, and compare prices. Get estimates from multiple providers to evaluate and compare coverage options, plan features, premiums, deductibles, and employee contributions.

6. Partner with a broker or provider: Working with a licensed broker or benefits provider can simplify setup, ensure compliance, and help you choose the right plans for your team. The right partner can help save you time and offer ongoing support as your needs change.

7. Customize your benefits package: Based on employee feedback and your financial goals, choose the mix of benefits that gives you the best return on investment. Take into account employee satisfaction and long-term retention goals. 

8. Inform your employees: Communicate clearly and consistently about what’s included, how to enroll, and how to make the most of their benefits. Educating your team is an important part of good benefits management and will help your team feel encouraged to use their benefits.

Frequently asked questions about the types of employee benefits

Here are some quick answers to common questions about employee benefits, including how you can help your employees make the most of your employee benefits package.

What are the most common types of employee benefits offered by employers?

Common benefits include health insurance, retirement savings plans, paid time off, and parental leave. Some employers also offer wellness programs, tuition assistance, or flexible work schedules. These benefits can improve job satisfaction, but they vary by employer.

What are the full-time employee benefits required by law?

Legally required benefits for full-time employees in the U.S. include Social Security and Medicare, unemployment insurance, and workers’ compensation. Under the Affordable Care Act (ACA), certain employers are obligated to either offer qualifying health insurance coverage or make a payment to the IRS. Under the Family and Medical Leave Act (FMLA), some employers must also provide unpaid, job-protected leave for specified family and medical reasons.

What’s the difference between mandatory and optional employee benefits?

Mandatory benefits are required by law and include Social Security, unemployment insurance, and workers’ compensation. Optional benefits are offered at the employer’s discretion and can include dental insurance, mental health support, or employee stock purchase plans. 

Optional benefits can help with recruitment and retention, but they come with an additional cost.

How can employees make the most of their benefits package?

Employees should review their options during onboarding or open enrollment periods, especially lesser-known benefits. They should also feel encouraged to contact HR with any questions regarding their benefits. Understanding what’s offered and how to use it can provide long-term value for employees and support overall retention for the organization.

Craft a benefits package your team will love

The right types of employee benefits don’t just support your team. They also strengthen your culture, improve retention, and help your business stand out. By listening to your employees' needs and wants, you can build a package that makes them feel truly heard and supported.

Putting together a comprehensive employee benefits package is easier than you think. Thatch is built to help you offer better benefits without the complexity. Create your account and see how simple it is to craft a benefits offering your team will actually use and enjoy.