There are a lot of people working in a company. But what makes them work in a company for a long time? It is a question that arises in the mind of every employee. The employees are not only working with the company just because of the projects and programs that it does but they also work for the benefits that are provided by the companies. Therefore every company has a flexible benefits program for its employees apart from the Cost to Company (CTC) that is provided by the company to its employees. These programs attract the more talented employees to join the company and contribute their work to the company and help the company grow.
What are the flexible benefits
- Flexible benefits are the extra financial stability that is given to the employees apart from the CTC that they are given. This covers other extra facilities of the employees that are not covered in the basic salary such as medical expenses and conveyance.
- The salary pay of the employee is structured in such a manner that the basic salary and the other flexible benefits are arranged in different arrangements. The basic salary on which the tax is charged is paid to the employee directly and the other flexible benefits are paid to them as reimbursements.
Importance of flexible benefits
- Every company has a different structure of flexible benefits programs. The percent of the CTC to be given in the flexible benefits is decided by the government. The areas of the flexible benefits are also decided by the company itself and it is based on the type of work it does and the requirements of the employees.
- It is very important for employee satisfaction. Employees have a guarantee of the availability of the money during the emergency which is useful to the company as well as more employees wanting to join such companies.
- Apart from this, flexible benefits can be used to save taxes. Taxes are paid only on the basic salary and not on the benefits. Hence, most of the time the basic salary is kept low and the left amount of the CTC of the employee is paid to the employee as flexible benefits.
- Companies also provide flexible benefits plans so that the employee gets to know the perks of each of the benefits given to them.
Hence, this is a major financial plan that profits both the employee and the company.