What are Fringe Benefits?

Fringe benefits refer to any form of long-term incentives or non-monetary compensation an employer offers employees. Such benefits exclude cash compensation like salaries and bonuses.

Fringe benefits can often apply universally to all employees; in other cases, they are specific to a group of staff, especially at the team and executive levels.

Some companies offer fringe benefits as compensation for employees’ costs incurred during their work. In other cases, such benefits are aimed at improving overall job satisfaction. 

They can be offered on a voluntary or mandatory basis. Some benefits, such as health insurance and retirement plans, are often mandatory under federal and state laws. Others, such as gym memberships and employee discounts, are voluntary benefits that an employer can offer to enhance the overall compensation package.

Fringe benefits are an essential part of a compensation package, providing additional incentives for employees to stay with the organization.