Benefits offered to employees have the objective of attracting and retaining top talent and of increasing employee satisfaction, loyalty, and productivity.

An overview of the benefits available to employees in the United States.

Across the United States, businesses of all sizes are constantly trying to remain competitive. Far from being simply expenses, employee benefits are a crucial element in this respect, as the range of benefits offered by US companies has the objective of attracting and retaining top talent and of increasing employee satisfaction, loyalty, and productivity. In this article we present an overview of the benefits available to employees in the United States.

Typical Benefit Packages

At their most basic level, the majority of employee benefit packages in the USA consist of health insurance, life insurance, retirement benefits and / or pension plans. Health packages are discussed in the "Employee Health Benefits" section.

Life insurance benefits are usually provided in the form of group insurance schemes, which are available as part of a pension or retirement plan or on a standalone basis. In most cases, this is a tax-free benefit and is calculated as a multiple of an employee's salary. Life insurance may also be provided as a “death in service” benefit package.

With regards to benefit and pension plans, it is important to note the difference between defined contribution plans (such as 401k and 403b pay-ins, where employers match the employees' contributions) and defined benefit plans, an alternative definition of traditional pension plans, which are typically based on length of service. A 2015 report by the Bureau of Labor Statistics stated that approximately 65 per cent of all US workers employed in the private sector have access to a retirement benefits package, a figure that increased to 98 per cent for workers employed by federal or local government entities.

Paid leave or paid time off (such as vacations and sick pay) are not mandatory in every state, so they are often included as part of an employee's benefit package.

Employee Health Benefits

According to the US Bureau of Labor Statistics, approximately 60 per cent of US firms with fewer than 100 employees include healthcare cover in their benefits package. The report also mentions that US firms also cover nearly 65% of their employees' family or dependants' health insurance premiums. The degree of insurance cover varies from company to company, although most benefit programs fall into 2 categories:

From a legal point of view, employers in the majority of US states are required to cover at least half of the premiums. Costs are highly dependent on a firm's size, location, and on the industry sector in which it is involved, although a recent study revealed that in small and medium-sized firms, the cost of healthcare benefits amounts to 15 per cent of the total payroll costs. Group health insurance plans or group coverage rates are regulated by each individual state, but health group coverage is also subject to federal law with regards to its “portability” or the employee's ability to extend coverage under specific situations or when changing jobs.

In addition to general medical care cover, US employers may also offer a range of specialty benefits, which can cover the cost of prescriptions (wholly or in part), dental plans, the cost of vision and eye care, and disability insurance.

Employee Discounts

Employee discount programs are generally offered by large corporations or by public sector employers. These programs are the result of the collaboration between employers and local service providers, and offer employees reduced rates in a variety of products and services. Some of the most common discount programs apply to travel, restaurants, cell phones and communications, wellness and leisure, and transportation.

Other Employee Benefits

In addition to all of the above, some US firms may choose to offer other employee perks, such as: