What Is an Employee Benefit Plan?


Many employers maintain employee benefits plans for wage and salary employees for a variety of reasons, including maintaining a competitive edge in comparison to other employers and to retain employees. Employers are responsible for implementing their overall employee benefits plan. They must determine who is eligible for employee benefits within a company and the benefits offered to eligible employees.

Employee Needs

Employers establish benefits plans to fit the needs of the employees. By meeting the needs of the employees and creating an effective benefits plan, employers can increase employee morale and overall productivity.


Employee benefits programs assist the various needs of the employees, including health needs, leisure time and retirement concerns. Comprehensive employee benefits plans that include a wide range of advantages to the employees provide long-term benefits to the employer. Many employees might stay longer with a company for the purpose of maintaining certain advantages of the employee benefits, which prevents the employer from experiencing continuous job turnover, employee complaints and unfilled job positions.


An employee benefits plan covers the benefits provided by an employer, which typically include health, retirement and unemployment benefits. The plan can also include social insurance programs sponsored by the employer, such as Social Security, unemployment insurance and workers’ compensation insurance. Employees may receive wage benefits for nonwork hours, such as holidays, vacations, sick leave and maternity leave. Some employers offer additional employee benefits, including Christmas bonuses, educational payments and profit-sharing payments. Additionally, employers sometimes provide service benefits to their employees by allowing them to utilize certain services, whereby the employer pays the full or partial costs; these services include fitness and wellness programs, recreational programs and company cafeterias.

Employee Categories

Not all employees within a company are eligible to participate in an employee benefits plan. Employers can deny some or all employee benefits to certain categories of employees. Generally, temporary employees, interns and part-time employees are denied certain benefits. However, whether an employer offers benefits to certain categories of employees is usually within the discretion of the employer. In many job settings, when an employer sponsors an employee benefits program, the benefits are offered to certain full-time employees, retired employees and permanent employees. Also, some employers maintain different benefits plans for different categories of employees. For instance, hourly and salaried employees can fall under different types of benefits plans.

Related Searches


Promoted By Zergnet


You May Also Like

Related Searches

Check It Out

Are You Really Getting A Deal From Discount Stores?

Is DIY in your DNA? Become part of our maker community.
Submit Your Work!