Following is a list of some of the more common employee benefits, sometimes referred to as fringe benefits, negotiated between employers and employees as conditions of employment. No law or constitution requires the offering of any of these benefits. However, once they have been contractually negotiated as part of the terms and conditions of employment, the failure to provide such benefits may expose employers to liability for breach of contract claims.
- Health and Life Insurance: Contrary to popular belief, no federal law requires employers to grant health and life insurance coverage to their employees. Health insurance coverage may be totally provided by the employer but is more often based on co-payment of insurance premiums with the employee. Spousal and/or dependent coverage is also an option. Long-term disability insurance is a premium benefit that most employers do not offer without substantial contributions from the employee toward the cost of the premiums.
- Paid Holidays: Contrary to popular belief, no federal law requires employers to grant paid holiday benefits to their employees. Paid holiday benefits are generally in the form of receiving full pay for a non-worked holiday or receiving premium pay for having worked on the holiday. The number of days designated as holidays varies from employer to employer, although certain ones are considered “standard,” irrespective of an employee’s personal beliefs or customs. They include: New Year’s Day, Memorial Day, the Fourth of July, Labor Day, Thanksgiving, and Christmas Day. There are a handful of other days that employers may consider holidays, including Presidents’ Day, Veterans’ Day, Martin Luther King Day, etc.
- Pension and Retirement Benefits: This area of benefits, although optional on the part of the employer, invokes the greatest federal and state governance. Pension programs are covered in a separate entry. However, if a private employer does not provide a pension plan, the federal Internal Revenue Code permits individual workers to establish their own individual retirement accounts (IRAs) with registered financial institutions and to set aside a certain percentage of earned income each year as tax-deferred contributions to the accounts. Self-employed persons may establish Keogh retirement accounts, which accomplish the same purpose.
- Paid Leave: This benefit may be in the form of vacation pay, paid sick leave, “personal days,” funeral leave, military leave, or jury duty.
- Supplemental Pay: This benefit is used as an incentive for working less than desirable days or shifts. It includes overtime, weekend, or holiday pay, shift differentials, and nonproduction bonuses.