Flexible benefits plans by employers are usually non-taxable, elective benefits which allow employees to customize their benefits plan. In a flexible benefits plan, the employer typically agrees to put a certain amount into a pooled fund that employees can access for eligible health care spending accounts, dependent care spending accounts, and transportation costs.
In this glossary, you will learn more about flexible benefit plans like-
- What is a Flexible Benefit Plan
- Benefits of Flexible Work Schedules
- Health-related Flexible Benefits
- Brief on Flexible Benefit Programs
- Benefits of Flexible Plans
What is Flexible Benefits Plan?
Flexible benefits are the additional, non-monetary benefits an employer provides to his employees. They do not necessarily fall into any particular category but can be grouped into three main categories:
- Flexible work schedules
- Health-related flexible benefits
- Flexible benefit programs
An example of a flexible work schedule is when an employee will work 9 am to 6 pm but come in just before 9 am and leave just after 3 pm on some days, so they only put in 7 hours of work.
What are the benefits of flexible work schedules?
Flexible work schedules would allow employees who have children at home to care for them before or after their typical workday. This would be very beneficial as the employee will spend more time with their family and will not need to use their sick leave or vacation days. Also, the employee may be at home in case of an emergency involving their child.
Flexible work schedules benefit everyone and allow employees to tailor their programs to suit their personal and professional needs. These can help an employee manage caring responsibilities for young children or elderly dependents. In addition, flexible work schedules can benefit employers because it leads to higher productivity, lower absenteeism rates, and increased worker commitment.
What are health-related flexible benefits?
Health-related flexible benefits can include sabbaticals, where employees get a break from their regular job, but the company will still pay them. This is often done for employees who are nearing retirement to take some time off and relax before retiring.
What are flexible benefit programs?
Flexible benefit programs include options where employees could choose one week of vacation over another rather than taking two weeks consecutively.
Examples of flexible benefits programs are limitless. For example, flexible holiday leave is another example where the employer will allow an employee to choose when they take their mandated holidays This way, the employee can budget their time off to spend with friends and family or other activities outside of work.
Another example is flexible child care benefits. In this situation, an employer would pay for a portion of a daycare center’s fees, if not all.
What are the benefits of flexibility or flexible plans offered by employers?
The benefits of flexible workforce include more free time with family, friends, or other activities outside of work. In addition, employers benefit by having more fulfilled and productive employees.
Employees who are happier outside of work will be more comfortable in the workplace. This usually leads to better communication skills, increased productivity, less absenteeism, and less turnover.
When an employer implements a flexible benefits plan, it also increases the ability for employers to attract and retain quality employees, which may result in a better and more efficient production process.
Employers who offer their plans typically retain employees and increase productivity. In addition, having employees work at home, part-time, or working remotely can reduce office space, transportation costs, and other expenses.
In conclusion, employers offer flexible benefits because they are beneficial to the company and the employees. While there are many benefits that an employee can receive from flexible benefits plans, examples of them here just touch the surface.
It plans can be painful for employers as well as employees to maintain. However, technological advancements like payroll software or complete HRMS software can make it easy and structured for HR departments to strategize and keep track of its offered by organizations.