Small businesses can offer a variety of benefits to their employees, both mandatory and voluntary, to attract and retain top talent. Some of the most common voluntary benefits include:
- Paid Time Off (PTO): This allows employees to take time off for various reasons, including vacation, sick leave, and personal days.
- Retirement Plans: These plans, such as simplified employee pension plans (SEP-IRAs), SIMPLE IRAs, and 401(k) plans, help employees save for retirement.
- Flexible Spending Account (FSA): An FSA allows employees to set aside pre-tax dollars for eligible health expenses, such as deductibles, copayments, and some prescription drugs and medical devices.
- Health Savings Account (HSA): Employees enrolled in high-deductible health plans can use HSAs to set aside pre-tax dollars for medical expenses, and the funds can be carried over from year to year.
- Employee Assistance Programs (EAPs): These programs provide support for employees and their families with personal issues that may affect job performance, such as mental health, work-life balance, substance abuse, and identity theft.
Mandatory benefits that small businesses must offer to comply with U.S. Department of Labor laws and regulations include:
- Workers’ Compensation: This insurance protects employers and employees from litigation over work-related accidents and illnesses, and it’s required in every state except Texas.
- Unemployment Insurance: This provides monetary compensation to workers who have lost their jobs through no fault of their own.
- Disability Insurance: This is mandatory in California, Hawaii, New Jersey, New York, Puerto Rico, and Rhode Island, and it provides income to employees who are unable to work due to a serious nonwork-related injury or illness.
In addition to these benefits, small businesses can also consider offering other perks, such as discounts on products or services, free meals, or reduced tuition for employees and their families. The specific benefits offered can vary depending on the business and its goals, and it’s essential to comply with state and federal regulations when designing an employee benefits package.
