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4 types of employee benefits for small businesses

Offering different types of employee benefits means your employees are supported through the important things in life

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What are employee benefits?The 4 main types of employee benefitsThe cost of employee benefits for small businesses

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  • Employee benefits are additional, non-monetary workplace perks offered to employees in addition to salary.
  • Offering different types of employee benefits can help you hire and retain talent, and build a positive company culture.
  • There are four main types of employee benefits that when combined, meaningfully support your team’s whole life: personal life, work life, financial goals, and mental and physical health.
  • Try not to get overwhelmed or pressured by the amount of different types of employe benefits you could offer: put the money you have towards the most meaningful types of benefits for your team.

What are employee benefits?

Employee benefits are all the extra, non-monetary bits your company offers the team in addition to salary. Also known as perks, fringe benefits, or benefits in kind, different types of employee benefits can be used to attract and motivate workers, or to support employee wellbeing and meet your caring responsibilities as an employer.

Offering different types of employee benefits is not only important for hiring and retaining talent, they also contribute to your company’s culture. There’s no one correct answer when it comes to which types of employee benefits you should offer: the ‘right’ employee benefits will look different for every team.


📚 Related reading
Take a look at our pick of the best employee benefits to offer your team this year

That being said, there is a difference between the benefits you have to offer (the legal employee benefits) and the benefits you might want to offer (the voluntary employee benefits). 

Legal vs voluntary employee benefits for small businesses

Every country will have its own minimum legal requirements in terms of what types of employee benefits an employer has to offer its team beyond salary. In addition to these legal benefits, companies can choose to offer voluntary employee benefits that go above and beyond the legal requirements. 

When it comes to the legal types of employee benefits in the UK, employers must provide:

Provided these ‘basics’ are covered, employers can choose to include further perks in their employee benefits package. These might be an extension of the legal benefits (e.g. more holiday allowance) or a selection of other types of employee benefits, like access to the Crew Test Pool of bikes at Canyon Bicycles GmbH, or Google’s massage programmes and cooking classes.

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The 4 main types of employee benefits 

1. Types of employee benefits that improve your team’s personal lives

Every one of your workers (obviously) has their own personal life and we hate to break it to you, but for some employees, personal life trumps work. The employee benefits in this category are all ways you can show your team that you value and support their life outside of work. But it's good for business, too: workers with the space to take time off, explore their own interests, and or recover from illness are naturally going to be more productive, effective, and loyal employees.

7 examples of employee benefits that improve the personal lives of your team:

🍼 Enhanced parental leave that offers more time off at a higher rate of pay than statutory requirements (e.g. 3 or 6 months maternity leave at full pay)

🏝️ More annual leave than statutory requirements

🗓️ Extra time off for additional life events (e.g. birthday, pet leave, wedding day, company closure between Christmas and New Year)

🙌 Inclusive bank holidays (e.g. employees can swap Good Friday or Easter Monday for another day of their choice)

🤒 More sick leave than statutory requirements (e.g. two weeks of self-certifying sick leave rather than the legal seven days)

✈️ Work from anywhere policy for a set amount of time each year (we’ve seen this be anything from two weeks up to three months)

💰 Paid sabbaticals (e.g. six weeks paid leave after four years on the job) 

Testimonial from Spill's Content Writer saying: "The month before my wedding day, I ended up in hospital for two weeks. It was a horribly stressful time, but I'll always be grateful to the team at Spill for their understanding and generosity in making sure I was able to get through such an eventful time in my personal life without any additional work-related stress."

2. Types of employee benefits that improve your team’s financial goals

The cost of living crisis in the UK is an ongoing concern for workers everywhere. So much so, that employees now view support for long-term financial security as a highly-valued employee benefit. And it’s creeping into benefits packages, too: while only 18% of UK employers currently focus on providing better support for financial security, 49% plan to improve their financial support benefits this year. 

Remember, these types of employee benefits aren’t necessarily about paying higher salaries (although, pay raises alongside inflation wouldn’t go amiss) — they’re about finding ways to ease the increasing cost of living everyday life.

5 examples of employee benefits that improve the financial security of your team:

💵 Increase or match your company’s contribution into workplace pensions schemes

📈 Offer stock options so that as your company profits, so do your employees (popular with startups)

💰 Set up salary sacrifice schemes (e.g. cycle to work, childcare support, electric vehicle schemes)

💲 Secure discounts on everyday purchases either through benefits platforms like Perkbox or more locally, like the University of Cambridge’s local CAMbens discounts scheme

🧠 Introduce ways for employees to get financial advice or support, like an annual meeting with a pensions advisor or access to Bippit


💸 Financial stress extends well beyond the bank account — PwC’s 2023 Employee Financial Wellness Survey found that money worries impact sleep (55%), mental health (56%), self-esteem (50%), physical health (44%), and personal relationships (40%).

3. Types of employee benefits that improve your team’s work life

Considering your team spends the bulk of their waking hours at work or travelling to/from work, it makes sense that this part of their day should be as good as possible. And while swanky offices with ping pong tables and nap pods might feel like enough, research shows that employees actually want to develop, upskill, and progress professionally: in one survey, ‘upskilling opportunities’ was the third most important benefit after flexible working and mental health support.


💡 It’s worth highlighting here that with these types of employee benefits, a lot come with a low financial cost to the company but generate huge returns on employee satisfaction. Just something to think about.

5 examples of employee benefits that improve the working life of your team:

🏡 Flexible working opportunities (e.g. core hours, hybrid working, compressed hours)  

🪜 Learning and development opportunities (e.g. clear role and salary progression frameworks, regular appraisals, mentoring programmes, paid for courses and conferences, subscriptions to online learning, job shadowing, manager training)

🚂 Season ticket loans or free parking

📃 Supportive policies and procedures (e.g. Spill’s right to disconnect policy and mental health sick leave policy)

🎉 Opportunities for social connections (e.g. Christmas or Summer party, sports day, and team lunches)

Testimonial from Lauren, Spill's Product Operations Manager, saying: "Joining Spill in a junior role without much experience of the working world, I found it so helpful being able to get my head around where I could expect to be in the following months and years, both in terms of types of role and in terms of how much I could be earning. It’s also been really motivating, knowing exactly what I have to do to progress to different levels, as I have specific goals and targets."

4. Types of employee benefits that improve your team’s mental and physical health

The way we feel has a huge impact on our ability to work and get through the day. And by feel, we of course mean physically and mentally. Companies have focused on employee physical fitness for a while now — and with good reason — but supporting mental fitness is something we’d urge you to get behind. And not just because workers need mental health support, they want it, too: 81% of employees will look for workplaces that support mental health when they seek future job opportunities.

8 examples of employee benefits that improve the wellbeing of your team:

 🧠 Introduce proactive mental health support with Spill to give employees quick and easy access to therapy

🖥️ Provide ergonomic equipment and standing desks (not forgetting remote or hybrid workers! A working from home allowance is useful here.)

📱 Offer corporate subscriptions to meditation apps like Headspace or Calm

📞 Get an employee assistance programme (EAP)

🧘 Run lunchtime exercise classes (in person or otherwise)

👟 Introduce walking meetings

🏋️ Offer gym discounts or other exercise perks through platforms like ClassPass

🩺 Set up employee health insurance

Testimonial from Log my Care's People Manager: "The team is absolutely loving Spill! We ran a trial last year, calling for volunteers to explore the service and the feedback was fantastic. This trial also debunked the notion that therapy is extreme—it's actually a proactive and preventive measure."

Spill gives your team access to high quality therapy, helping your create a working environment that's safe, inclusive, and effective.

See how Spill works

The cost of employee benefits for small businesses

With such a variety of different types of employee benefits, it can be easy to feel overwhelmed at the potential cost of laying on all these things — especially as a small business. 

But, here’s the thing.

It’s really, truly not about splashing the cash on a bunch of different benefits. Instead, it’s about putting the money you do have towards the most meaningful types of employee benefits for your team.

If you have a young workforce based in the same area, then investing in a nice office and regular team activities may well serve as a big attraction. But, if you’re noticing that a lot of your team are working long hours, taking time off, and/or waning creatively, you’d see a huge return in providing employee mental health support

Your team deserves to be thanked for giving their brain power to the success of your company and offering a meaningful employee benefits package is the perfect way to show your gratitude.

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Download our employee benefits questionnaire

Use our template to ask your team how they feel about your employee benefits package and what you can do to improve it

See how much it would cost to benefit your team’s wellbeing by giving them easy access to next-day therapy sessions.

Check our prices