Small Business Glossary and Definitions

A Benefits Package (also called fringe benefits) is a group of non-wage compensation items given to employees on top of their regular salary or wages. These benefits can include healthcare, dental and life insurance; vacation and sick leave; employer-provided or employer-paid housing; retirement; disability income protection; tuition reimbursement; daycare; and profit sharing. A benefits package aims to increase employees’ economic security, improve employee retention and provide a competitive edge when recruiting employees.

A benefits package also can include “perks,” which are more discretionary, often used to reward employees who have seniority or have been doing especially well. These can include free refreshments, gym or golf course memberships, take-home vehicles, free hotel nights and first choice for vacation time or job assignments.