How Employee Benefits Affect Worker Performance [Updated 2019]

Organizations exist because of the people that make it up. Without employees, businesses would fail to exist. This is why in the world of business, the competition to attract and keep employees is fierce. 

Moreover, employee benefits impact worker performance. Studies have also shown that employee benefits also affect their job satisfaction, engagement level and overall well-being. 

For an employee, employee benefits are crucial to compensate for the time and commitment they dedicate to their organization. While they are paid their salary, employee benefits are designed to further help them with both their personal and professional lives. 

For the company, employee benefits can help them with improving worker performance and productivity. It would then lead to more sales. Competitive employee benefits also doesn’t that it would be more expensive for the company.

It might surprise you how being more generous to the employees can be less expensive. The point here is that having competitive employee benefits is good for both the employees and the organization.

After reading this article, you’ll be able to learn more about the impacts of employee benefits and how it affects worker performance and sales. 

Employee Benefits is More Important than Money

If you try to look for the main reason why employees leave or stay at their job, you’ll see that money isn’t the answer. While money is the reason why employees go to work, money is not enough to keep them.

The reason for this is because apart from money, employees also have other needs. Such needs are to be happy, to feel appreciated and to feel that they are supported by their organization. 

According to Julie Stich, “benefits are an important way to attract and retain key talent”. Money isn’t everything nor is it enough to keep employees motivated or engaged. 

Employee engagement is crucial because it impacts worker performance. One way how employee benefits affect employee performance is that it can improve employee engagement.

Employee benefits also help shape company culture which is the main reason why employees leave or stay at their jobs. Here are statistics about employee engagement, retention and company culture:

  • According to the American Institute of CPA, 80% of employees would rather keep a job with benefits than to leave for a higher paying job but with no benefits.
  • A study from WTW showed that 78% of workers said they would likely stay with their employers because of the employee benefits they offered. 
  • According to Zenefits, more than 60% of employees would accept a job with lower pay for better employee benefits. 
  • According to Gallup, a highly engaged workforce is 21% more profitable.
  • The same study also showed that highly engaged employees are 17% more productive.
  • From the book, Corporate Culture and Performance, it was stated that a good company culture can increase revenue by up to 400%.
  • According to Hays, it was found that 47% of people have company culture as the main reason when looking for new jobs. 

How Employee Benefits Affect Worker Performance

Employee benefits being offered can be different depending on the type of job, organization and place you are from. However, there are basic benefit laws that all employers must follow. 

According to VirginPulse, some of these basic benefit laws are:

  • Providing employees with time to vote, perform military service or serve a jury.
  • Pay state and federal unemployment tax
  • Comply with all workers’ compensation requirements
  • Comply with Federal and Family and Medical Leave (FFML)
  • Contribute to state short-term disability in states where these programs exist

Companies are not required to provide health plans, retirement plans, dental plans, vision plans, life insurance plans, paid vacations, etc. However, a lot of companies provide these benefits and more because they know it attracts employees and it improves their retention.

Moreover, employee benefits contribute to:

  • Company culture
  • Employee engagement
  • Employee performance
  • Productivity
  • Employees’ well-being
  • Increase in revenue

Here are the results from studies about employee benefits in relation to worker performance:

According to Winston Benefits, providing accommodations help reduce absenteeism and presenteeism. Presenteeism is when employees go to work with medical conditions resulting in productivity loss. 

If providing accommodation is not viable, incorporating healthy building features is another option. This can be as simple as adding plants or “green” features to the working areas. According to World Green Building Council, these are the effects of having healthy building features: 

  1. Increased productivity
  2. Lower absenteeism rates
  3. More collaboration

With millennials dominating the global workforce population, offering remote work or flexible hours has become the new trend. This is because millennials value work/life balance. To them, one way of achieving this is to work with flexible hours or by working remote.

Studies have shown that flexible hours or working remote does help improve worker performance and productivity. Here are the statistics:

  • According to CareerBuilder, 59% of employees said that having a flexible schedule matters most for them. 
  • A poll from showed that 20% of their respondents said that they became more productive after they moved to a flexible schedule. 
  • According to Zenefits, 73% of employees mentioned that flexible work arrangement increased their work satisfaction. 
  • Employees who work remotely for at least once a month are 24% more likely to be more productive and happy. This is according to Smallbizgenius.

An example of a big company offering flexible work schedule is McDonald’s. Part of McDonalds employee benefits is reduced or flexible hours and full-time employees can even have as much free food as they want. 

Another is the Hyatt Hotels Corporation. Part of the Hyatt employee benefits is also being able to work with a flexible schedule. This allows both companies to attract people that value flexible working hours.

Employee benefits can come in a lot of forms. From allowing employees to bring pets to work to free gym membership, access to swimming pools, free yoga class to having a world-class work space, employee benefits impact worker performance because it improves their happiness at work, engagement, satisfaction and it helps to form a positive company culture.

See what more employee benefits you can offer to your workers for them to perform better at their job. Having good employee benefits is a win-win for the employees and the organization.