Fringe Benefits

Meaning & Definition

Fringe Benefits

Fringe benefits refer to extra non-monetary advantages that employees get on top of their standard wages or salary. Employers offer these benefits to augment the overall compensation package and enhance job satisfaction. Examples include health insurance, retirement plans, paid time off, dental and vision coverage, life insurance, wellness programs, and other supplementary offerings. Fringe benefits aim to support employees' well-being, work-life balance, and financial security, contributing to a comprehensive employment package.

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Frequently Asked Questions (FAQ's)

  1. What does compensation and benefits mean?

    Compensation and benefits refer to everything an organization is offering to an employee. This compensation and list of benefits could be in the form of financial aid, incentivized bonuses, vacation surplus, insurances, and more.

  2. What is compensation and benefits in HRM?

    In HR management, compensation and employee benefits are the renumeration that a business provides to the employee for the services they render to the org. It helps set incentives, and, in turn, helps the employees stay motivated to achieve more and achieve fast.

  3. What are the four types of compensation?

    Primarily, there are four types of compensation that can be offered to employees, and these are hourly, salary, commission, and bonuses.

  4. What is the difference between compensation and benefits?

    Compensation is the monetary provisions that are provided to the employees by the hiring organization. This financial aid is provided to the employee in terms of wages, salaries, tips, and more. While benefits can be monetary and non-monetary that are presented to the employees in the form of value, in exchange for their services.

  5. What is the importance of compensation and benefits?

    Compensations and benefits are an important aspect of human resource management as it helps the workforce keep going. These compensations keep the workforce motivated to achieve more. It helps the organization award its employees on the basis of their performance and helps them excel at every venture they undertake.

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