How Fringe Benefits Work

Important Fringe Benefits

Health insurance has become a standard offering of American employers, with nearly 98 percent offering some sort of plan; while most companies only offer it to full-time workers, 37 percent of employers offer health insurance to part-time employees. Other benefits that have become fairly common in the American workplace are life and disability insurance and retirement plans, sometimes with an employer contribution. Payment of moving expenses for a work-related transfer is a very common benefit, as is an automobile allowance for business travel. Cell phones plans have also become common fringe benefits [source: Society for Human Rersource Management]. Many companies reimburse employees for gym memberships, or they go a step further and provide their own workout facilities for employees. Flexible work schedules and telecommuting -- a word that didn't even exist a decade ago -- are becoming commonplace.

Some fringe benefits were formerly common, but are becoming less so as the recession changes spending practices. Fringe benefits that seem to be on the way out include executive signing bonuses and bonuses for recommending a successful job applicant.

Some companies are nearly legendary for their fringe benefits. Google, for instance, provides free meals in the company cafeterias, free doctor's visits, and in-house washers and dryers, so employees can do a load of laundry while they work. Dan Gilbert, owner of Quicken Loans, hires buses to take employees to Cleveland Cavaliers games. The employees probably end up cheering for the Cavs -- Gilbert owns the team.

Here are some other unique fringe benefits, as reported in the Industry Market Trends newsletter:

  • giving employees 2 weeks paid time off to work at a non-profit organization
  • delivering locally grown organic treats to workers' desks
  • encouraging employees to spend up to 10 percent of their work time on projects of their own devising
  • providing laundry pickup and return
  • offering interest-free loans to employees to purchase computers

Related Articles


  • Employee Benefit Research Institute. "History of Health Insurance Benefits." March, 2002. (08/03/2010).
  • Fortune. "Unusual Perks." January 22, 2007. (08/03/2010).
  • H&R Block. "Tax Tips & Calculators." 2010. (08/03/2010).
  • Internal Revenue Service. "Taxable Fringe Benefit Guide." January, 2010. (08/03/2010).
  • Leybovich, Ilya. "Fringe Benefits: Unique Employee Perks." Industry Market Trends. July 6, 2010. (08/03/2010).
  • Maling, Brittany. "Building Company Loyalty With Unusual Benefits." HR World. (08/03/2010).
  • Society for Human Resource Management. "2010 Employee Benefits ." February, 2010. (08/03/2010).