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How to design your employee benefits program

15 min read
While every employee loves getting paid, it’s just the beginning when it comes to overall satisfaction. Employee benefits programs reward your employees with a range of different perks, financial or otherwise. And in a competitive employment market, employee benefits packages are an important part of your employee experience offering.

What is an employee benefits program?

Employee benefits are the things you offer employees to reward and recognize their contribution to your company in addition to their wages. An employee benefits program is the nerve center of your employee benefits provision, bringing together all the employee benefits you offer your people in one centrally managed strategic operation.

This includes what you offer, how you decide on a benefits package for each role, how you gauge the success of your benefits offering, and how you administer and manage employee benefits  e.g. through a dedicated benefits portal or via a bigger HR software platform.

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10 employee benefits examples

Employee benefits are ‘nice to have’ items a company offers at its discretion, over and above basic compensation. These are the perks and highlights that spark your imagination as you’re sizing up a potential new employer, or that you’re proud to tell friends about once you’re hired.

Employee benefits range widely, from those that have a long-term impact on quality of life to fun, daily mood lifters.

Common benefits employers offer employees can  include:

  1. Retirement income plans
  2. Health insurance
  3. Life insurance
  4. Disability insurance
  5. Stock options
  6. Educational assistance programs
  7. Paid time off
  8. Free lunches
  9. Mood-lifters, such as ‘bring your dog to work’ days
  10. Company social events

Every company has its own unique employee benefits program, made up of a range of financial, lifestyle, workplace, and other perks, and the DNA of the benefits program will depend on your company culture, among other factors.

Why does an employee benefits program matter so much?

Employee mobility has never been higher. Our data shows that in 2023, just over half (57%) of employees are satisfied with their current pay and benefits, and that satisfaction has dropped 10 points since last year. The Great Resignation brought this trend into the headlines as employees around the world look at what work means to them and how they can make it fit better with their values and priorities.

To attract top talent in a competitive market, companies must do everything they can to offer an employee experience that goes above and beyond the competition. This means not only creating a benefit offering that appeals to job candidates, but also one that retains existing employees and keeps them happy, engaged and fulfilled for as long as possible.

However, winning employee hearts and minds isn’t only a matter of offering the best package with the most valuable benefits — after all, employee benefit programs sit alongside a whole range of other factors that drive employee experience.

That said, employee benefits have a unique role to play in generating positive feelings and making employees feel seen and valued by their employer. And we’ll go into more detail next.

Employee benefits optimizer example

What are the benefits of an employee program?

Historically, calculating the dollar value of ROI on employee benefits has been notoriously tricky, as SHRM noted in 2016. The reason is that investment in employee benefits programs tends to offer value over the long-term rather than in a business quarter or two. It’s also difficult to compare when ranking the financial success of companies with great benefits programs against those with lackluster offerings.

There is an exception to the rule when it comes to negotiating benefits with suppliers, however, as this can deliver cost savings to your employees and your company. A large organization will have greater buying power than individuals. So if you negotiate a bulk discount on insurance benefits or cell phone plans for your employees and offer it as a perk, they’ll get more value than if you put that budget straight into their salary instead. Of course, you need to choose things your employees would have spent their money on anyway, but provided your benefits are things they want and need, it can work well for both sides.

What we do know for sure is that employee benefits programs have a positive impact on the employee experience. They work their magic through a few different drivers, including:


Gallup’s research shows that engagement mostly comes from relationships, particularly those between employees and managers. Employee benefits that foster good interpersonal connections, such as team days, social events and company meals, can directly boost engagement in this way.


Growth and development opportunities at work are important drivers of a great employee experience, and they fit beautifully into employee benefits planning. Offering support with tuition fees for those who want to pursue a formal qualification related to work (or not), paying for employees to attend courses and conferences, and offering a stipend for personal goals and growth are all great examples of benefits that drive employee development.


Employee wellbeing can be enhanced by all kinds of benefits, from those that directly care for mental and physical health, such as medical insurance, disability insurance and generous sick leave, to those that promote healthy lifestyles, such as nutritious meals at work, free yoga and exercise programs. Wellbeing can also relate to peace of mind, which may be enhanced through benefits like retirement plans that help employees take care of their financial future.

How to design an employee benefits program – with 11 examples

Employee benefits are extremely important to today’s workers, with some even placing more value on benefits than pay. A study reported in Forbes found that a majority of US employees – 62% – would trade a better benefits package for a lower salary.

But before you invest your benefits budget in the creme de la creme of health insurance, disability insurance, tuition reimbursement, free lunches and premium branded merchandise… how do you make sure your employee benefits plan lives up to its potential?

1.  Decide on the level of employee benefit program you’ll offer

What makes the difference between a good-enough benefits program and one that’s exceptional? Here’s what different benefits programs might look like:

A basic-level program

A basic-level program covers the kinds of perks that are either mandated by local laws, or standards within the labor market. This might include important health benefits like insurance or health savings accounts, retirement plans and life insurance. Employees may have access to optional benefits if they contribute financially towards them. A company offering basic but valuable benefits like these might be a small business starting out, or one that hasn’t reviewed its benefits program in some time.

A great program

A great program offers all of the above, possibly in more generous quantities and with more insurance coverage. It may also have more than the legal minimum allowance of parental leave, sick pay and annual leave. There may be lifestyle benefits like free food, retail discounts and childcare. A great program might include insurance for risks other than health, like long-term disability insurance or health coverage for complementary therapies and other treatments.

An exceptional program

As well as being generous and wide-ranging, top-tier benefits programs give employees the flexibility to choose which benefits suit them best. Health coverage and disability insurance may be extended to members of the employee’s immediate family as well as themselves. They may be given a budget to spend on a benefit category, such as personal development or travel. The benefits will be tailored to the employees and developed based on what matters most to them. The program is reviewed regularly so it will stay up to date.

2. Choose benefits that align with your values and your people’s

Putting together an employee benefits package that reflects your values as a business is powerful. It’s a way of living the values and nurturing a company culture that reflects them. Experts at The University of Pennsylvania’s Wharton Business School found that when perks and benefits are characteristic of a company in this way, it creates an emotional resonance that affirms the employee’s choice of a workplace that shares their values.

For example, a company that is deeply committed to sustainability might offer its employees free energy-saving light bulbs on demand, or paid time off to volunteer with environmental organizations, in addition to table-stake benefits like medical insurance and pension plans. These value-led benefits might not necessarily be high in financial value, but they hold a deeper significance for employees because of what they represent.

3. Prioritize benefits during onboarding

Discussing employee benefits during the onboarding process is an essential part of welcoming new hires into your organization. But new employees may feel too overwhelmed to ask for what they need.

This is where HR and people teams come into play. It’s important to explain what new hires can expect from their benefits straight away. You might consider adding a benefits offerings training session to new hires a few weeks into their new roles to reassess and check over their benefits.

Retirement planning and healthcare coverage are typically the most important benefits for people, and you’ll want these to be secured earlier rather than later to maximize their value to your people.

4. Make sure employees know what’s available

Surprisingly, given how much employees value benefits, it’s common for employees not to be familiar with their company’s benefits program, which means they don’t take advantage of what’s on offer. Forbes reported that as many as 50% of employees don’t understand their benefits. Keeping the program visible and accessible and regularly reminding employees that they have unused benefits will help you make sure your efforts aren’t going to waste.

5. Don’t avoid uncomfortable conversations

If you really want to know what benefits employees would most value, ask them.

Take healthcare, for example. While health insurance is a common benefit most workers take up through their employer, it’s often a difficult benefit to discuss due to the complexity of coverage options and family member considerations. Give your employees all the information they need to make the best decision for themselves and their families. This can drive engagement, increase retention, and open up more communication.

You can broach questions such as:

  • Do you understand our sick leave policy?
  • Does your package have enough life insurance cover?
  • How can our company support your mental health better?

6. Find out what your employees truly value

When selecting benefits for your employees, you may feel pressure to keep up with leading companies and match their offerings. But creating an employee benefits package based on what other companies offer might be doing your employees a disservice. What’s right for Googlers in Silicon Valley may not translate into a valuable benefits program for a publishing company in the Midwest, for example.

To make sure your benefits offering gives your employees everything they want, you need to work with their feedback. That way you’ll create a program that supports a good employee experience without spending money on benefits that don’t land with your people. So…

7. Use an employee survey to gather feedback about benefits

Gathering feedback on how employees feel about their benefits can be incredibly useful. Start by asking employees about:

  • the areas where they see room for improvement in their benefits options
  • if they are still confused about how to access them
  • if there are any extra benefits or perks they believe should be available

When surveying your employees about employee benefits plans, limit the choices that the company can actually offer. You could rapidly lose employee trust if you’re asked for a certain benefit, and the company fails to deliver, e.g. dental plans may not be available due to expense.

That said, continue to gather suggestions in your survey’s open-ended questions, as these can signal what you could consider offering in the future, or suggest benefits your HR team hadn’t considered but which would be easy wins.

8. Analyze the responses and weigh up the costs and benefits

You won’t be able to deliver everything your employees want, whether because of cost, or their implementation time.

So every HR team needs to prioritize what it chooses to offer employees. But it can be challenging to understand the relative impact and cost of each benefit.

  • Would free lunches make people more productive or likely to stay?
  • Would an enhanced dental plan be expensive but not actually improve engagement?

9. Make benefits specific to employees, departments and regions

Do your 18 to 25-year-old employees prefer different benefits from your older Gen X employees? Insights like these can help you create more bespoke benefits plans for different employees at different points along their employee lifecycles.

You can consider making benefits specific to departments, or just regions if you’re not ready to personalize them for different employees.

If you’re an international organization, you won’t be able to avoid some regionalization: local regulations in some countries might oblige you to offer certain benefits . In other circumstances, segmentation can identify that different countries culturally and societally prioritize very different things.

10. Communicate benefits in an attractive way

How you communicate new and existing benefits is crucial to their ultimate uptake.

For example, one financial services organization offered a retirement contribution plan with the snappy title Company Retirement Contribution. When surveyed, employees reported either not understanding what the plan was, or not seeing how it was relevant to them. The company renamed it 401k Boost.  Suddenly there was a big uptick in employee contributions, and survey feedback suggested the new name now made it sound like a great perk.

11. Act on employee feedback and be transparent about it

It’s essential that you showcase the benefits that were created as a result of employee feedback. You could disseminate the information to managers, so they can share feedback and actions with their teams.

The financial services company above tags employee-inspired benefits or improvements with a sticker that says: ‘You told us. We took action’.

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