What are employee benefits?

Employee benefits are non-salary compensation and perks, also known as mandatory or statutory benefits. Employers are required by law to provide these benefits to their employees, and vary depending on location, but typically include: Health insurance, Worker’s compensation, Unemployment insurance, Family and medical leave, Overtime pay. While health insurance, and family and medical leave, are not required for all organizations, some states have mandated disability insurance and retirement plan requirements.

What are benefits that are voluntary?

Also known as supplemental employee benefits, these are benefits that an employer voluntarily offers employees, covering any perk offered to employees that is not mandated by law. While the list of benefits in this category began with perks such as dental insurance and life insurance options, today, the list of voluntary benefits has grown significantly to include: Rewards programs, with the ability to earn and redeem points Unlimited paid time off, Flexible work schedules, such as four-day work weeks, Wellness programs, such as discounts on gym memberships, Budget for setting up a home office, such as buying a desk or external monitor.

Why are employee benefits important?

Employers use benefits to attract top talent, especially in a tight labor market, and to retain employees once hired. They enable smaller companies to compete with larger organizations that may pay higher salaries, and benefits can act as employee engagement tools and support a positive corporate culture. Millennials influence the types of benefits available in the workplace, and for good reason, as the U.S. Bureau of Labor Statistics reports that the Millennial cohort is set to outnumber other age groups in the workforce by 2029. According to insights from Great Place to Work, finding a sense of meaning and purpose is a key driver to retaining the Millennial cohort, along with these four key areas: Profit-sharing model, Fair compensation package, Clear guidance and expectations, Benefits related to work-life balance. Benefits are also essential to employee morale, satisfaction, health and well-being and help organizations maintain a competitive edge against other companies.

6 steps to great employee benefits programs

6 steps to creating an employee benefits program
What to include in employee benefit programs
Employee benefit programs FAQs
Turn employee benefit programs into your retention engine

When you think of employee benefit programs, your mind probably jumps to the usual suspects: health insurance, retirement plans, maybe a gym discount or two. Maybe you’ve even marked your calendar for Employee Benefits Day. But here’s the thing — many organizations stop there. And when they do add to their benefits lineup, it’s often a scattershot of perks that rarely evolve or resonate.

Today’s employees expect more — and they’re not shy about it. The workforce is more empowered than ever, and that means benefit programs need to do more than check a box. They need to attract great people, keep them engaged, and prove that your organization truly gets what matters most.

The good news? You don’t need a massive budget or a corporate army to build something impactful. These six simple steps will help you create a benefits program that actually benefits your people.

6 steps for creating employee benefit programs

Building employee benefit programs isn’t just about offering a few perks and calling it a day. It’s about showing your people that you understand what they value — and proving that you’re willing to invest in it. The good news? A thoughtful program doesn’t have to be flashy or expensive. It just needs to be strategic, personal, and built with your workforce in mind.

Here’s where to start:

6 steps for creating employee benefit programs

1. Learn what your employees want

Spoiler: it’s not just pizza Fridays. 28% of employees say compensation is the top reason they’d walk away from their current job, with career growth, flexibility, and recognition close behind, according to the Achievers Workforce Institute’s (AWI) Engagement and Retention Report (EOR).

Every team has its own mix of priorities, so skip the assumptions and go straight to the source. Use surveys, pulse checks, or a real-time engagement platform to find out what your employees want more of — and what they could happily live without. That input is your blueprint for benefits that actually matter.

2. Define your program’s goals

Benefit programs without goals are like treadmills without power — a lot of effort, not much progress. Whether you’re trying to win over new hires or keep long-time employees from jumping ship, it pays to get clear on your objectives from the start.

Here are a few common goals worth targeting:

Attracting stronger candidates
Reducing employee turnover
Upping productivity
Lifting morale
Improving engagement
Supporting work-life balance
Reinforcing positive behaviors

Being intentional and upfront makes it easier to measure impact later, and helps ensure your budget’s being put to good use.

3. Offer great rewards

Appreciation is one benefit that sticks, especially when it comes with rewards that feel personal and meaningful. Combine that with recognition and rewards software integrated into your benefits program, and you’re turning everyday appreciation into a powerful engagement tool.

Here’s how to make it work:

Give employees a monthly points allowance to recognize great work
Let team members choose rewards that actually resonate with them
Centralize recognition in a platform that fits into daily workflows
Use social recognition to build culture and peer connection
Keep it budget-friendly while offering real value

4. Design your program

Now that you know what your employees want, what your organization needs, and how rewards can fit into the mix, it’s time to bring your program to life. That starts with smart prioritization — and a little reality check around budget and compliance.

Here’s how to break it down:

Start with the must-haves: Cover your legal bases first. Make sure you follow all relevant employment laws and requirements.
Factor in mandated benefits: Think family or medical leave, workers’ comp, disability, unemployment insurance — the essentials.
Consider your company size: Rules can vary depending on your headcount, so check what applies to you.
Budget realistically: Once the non-negotiables are in place, look at your available budget and align your choices with your goals.
Explore voluntary benefits: Think low-cost, high-impact offerings like flexible work, wellness initiatives, or points-based recognition that employees can actually get excited about.
Support professional growth: Career development benefits — like tuition reimbursement or learning stipends — send a clear message: you’re invested in your people’s future.

The goal here isn’t to offer everything. It’s to offer what matters — in a way that’s thoughtful, sustainable, and aligned with both your culture and business goals.

5. Communicate your benefits to employees

Even the most thoughtful employee benefit programs can fall flat if no one understands them. That’s why clear, compelling communication is key.

Break things down in plain language. Explain not just what you’re offering, but why it matters — whether it’s how your 401(k) match works or how to make the most of paid time off. At the end of the day, clarity builds trust. Trust builds engagement.

6. Leverage feedback to make your program better

A great benefits program is a living, breathing part of your employee experience — and it should grow with your team.

Gather regular feedback through pulse surveys, anonymous tools, or your employee engagement platform. Use that data to find out what’s working, what’s wasting budget, and what your people are asking for next (hello, hybrid flexibility). The more you listen, the more your program reflects what your team needs — and that’s what drives real impact.

Because when your benefits evolve with your workforce, you’re not just checking a box. You’re building a culture that adapts, improves, and listens.

What to include in employee benefit programs

Great benefit programs aren’t built on perks alone — they’re built on purpose. The best ones reflect what employees need to feel supported, motivated, and seen, both in and out of work. Here are the essentials worth including:

Employee recognition

Recognition is one of the fastest ways to build connection and culture — and it pays off. Achievers Workforce Institute found that 80% of employees who are recognized meaningfully at least once a month would recommend their workplace to others.

Platforms like Achievers make it easy to build recognition into the flow of work, so it happens often, feels genuine, and reinforces the values that matter.

To make recognition stick:

Include recognition from all directions — manager, cross-functional, peer-to-peer
Make it real-time, specific, and tied to company values
Blend social and monetary appreciation
Keep it easy and consistent with a centralized system
Create visibility across teams so recognition reinforces culture

Employee rewards

Today’s employees aren’t looking for one-size-fits-all rewards — they want options that feel personal. Flexible, meaningful rewards show people you value their effort and their individuality.

With a platform like Achievers, employees can give and receive recognition points, then choose meaningful rewards that resonate. It’s flexible, scalable, and fits any budget.

Build your program around:

A points-based system that empowers peer recognition
A wide reward marketplace — from experiences to PTO
Low-lift admin tools that make program management easy
Personalization options to make rewards feel authentic
Integration with your broader engagement and recognition strategy

Wellness programs

Wellbeing isn’t a wellness week and a fruit bowl. It’s a strategy. SHRM’s 2024 survey found that 70% of organizations prioritize flexible work benefits and 48% include wellness in their packages, because healthy employees stick around longer, show up better, and perform at their best.

Here’s how to make an impact:

Offer stress-reducing options like yoga or mindfulness programs
Support chronic condition management and health challenges
Bring in expert-led sessions or wellness perks that actually resonate
Think whole-person wellness, not just physical fitness

Flexible work schedules

Work flexibility is one of the top reasons employees decide whether to stay or go — it ranks third overall, according to the EOR Report. That makes it more than a convenience; it’s a deciding factor. Offering flexibility signals that you trust your people to manage their time and do great work, no matter where they are.

Consider these benefits:

Offer hybrid, remote, or flexible-hour options
Experiment with four-day workweeks or staggered shifts
Prioritize outcomes over face time
Make flexibility accessible across roles, not just office-based ones

Career development opportunities

No one wants to feel like they’re in a dead-end role with a shiny title. Growth matters — not just for career trajectories, but for motivation, performance, and staying power. In fact, employees who don’t feel supported in achieving their personal and development goals are 1.8x less likely to exceed performance expectations, according to AWI.

Try this approach:

Offer access to learning stipends, tuition reimbursement, or online courses
Make internal career paths clear, visible, and navigable
Provide mentorship or coaching opportunities tied to real growth
Make development a regular topic, not an annual check-the-box

Transparency and feedback

Feedback shouldn’t feel like a performance review — it should feel like a conversation. Creating a culture of transparency keeps employees aligned, engaged, and invested in doing their best work.

Here’s how to center transparency:

Send regular pulse surveys or check-ins, and share the results
Highlight what’s changing based on employee feedback
Train managers to ask open-ended questions and listen actively
Create space for two-way conversations, not one-way reviews
Use feedback insights to guide recognition, development, and team goals

Turn employee benefit programs into your retention engine

Good employee benefit programs cover the essentials. Great ones make people feel genuinely supported. The difference? Recognition and feedback — and the tools to do both well.

A recognition platform like Achievers makes it easy to bake meaningful, personalized rewards into your benefits strategy. When employees can choose rewards that matter to them, recognition becomes more than a gesture — it becomes a reason to stay.

Layer in a Voice of Employee solution, and you’ve got a real-time read on how your team feels about what you’re offering. Surveys, quick polls, and anonymous feedback channels help you cut through the guesswork and act on what you hear.

Put them together, and your program stops being a checklist and starts becoming a reason people choose to stay.

Before you build your benefits strategy, learn the workforce trends shaping engagement and retention

Get the Engagement and Retention Report

Take your employee benefits program to the next level with Achievers

Explore our platform