What Are Fringe Benefits?

Worker’s fringe benefits and expenses serve many purposes. They are designed to help mitigate the economic impact of the employer’s contributions to the company’s payroll. By providing additional benefits to employees, businesses can attract and retain qualified workers, while decreasing costs associated with on-the-job training and other benefits for employees. In addition, the fringe benefits act as an incentive for employees to remain at their job by providing them with a range of potential benefits, including raises and promotions, and the promise of advancement down the road. Finally, the fringe benefits act as an informal method of management coordination amongst the various aspects of the business operations.

fringe benefits


Most employee benefits and perks in the form include various forms of non-cash compensation offered to employees as well as their usual wages or salaries. Examples where an employee trades wages for any other type of fringe benefit is usually referred to as a “pay for performance” or “performance pay.” Under certain circumstances, an employer may pay an employee for having successfully completed an approved training program.

Other types of fringe benefits may be in the nature of services rendered by the employee. For example, if an employee regularly performs bookkeeping, clerical, or other work that is related to the employer’s business, they may be entitled to receive a fee for engaging in this work. The fee may be in the form of a percentage of the value of the service rendered or a flat fee. In certain cases, an employee may be compensated for the actual cost of purchasing materials used for the performance of their duties. This may include mileage, per Diem or a portion of utility bills.

Most employee benefits and fringe benefits are considered to be an expense during the employee’s regular work hours. Therefore, these benefits must be provided with written notice prior to an employee beginning any type of employment. There are two exceptions to this general rule. When an employee begins working for a company and the company provides their employees with free professional advice or training on fringe benefits, this may be considered a fringe benefit. In addition, when an employee receives stock options or restricted shares based on their performance as an employee, it will probably be considered a fringe benefit. However, when an employee does not receive a fringe benefit based on their performance, it will be considered an expense.

When an employee’s salary or wage increases, the new wages may cause an increase in their perceived value. This may cause an increase in the amount of fringe benefits to be paid. Similarly, an employee who obtains a raise or promotion will most likely incur some additional benefits. These benefits could include travel expenses to attend all appointments, meals, or any other fringe benefits that are considered an added benefit by an employer. When the employer pays for the cost of these benefits, the employee’s paycheck may contain more money than it did before the promotion or raise.

As stated above, the decision of what fringe benefits an employee receives is primarily based on the performance of the employee. An employee may receive fringe benefits based on their race, gender, religion, union membership, or any other characteristic that a company considers important. These employees may receive a bonus or wage increase based on the performance of their boss. Although companies have the right to determine what employees receive, they are not allowed to discriminate against any employee because of their race, gender, religion, or union membership. The equal opportunity of an individual to earn a living has been denied to some employees because of their race, gender, religion, or union membership.