As your business grows, so too may the scope of benefits offered to employees. Large corporations offer a vast menu of benefits for employees and shoulder much of the cost. But small businesses that are growing can add benefits to their current offering, and in ways that won’t bust the budget.
The Business Owner Resource Center says “high-quality benefits are shown to bolster job satisfaction and company loyalty, and 51% of employers say that their benefits package will play a significant role in their employee management efforts over the coming years.”
Maybe you’re currently offering paid vacation days and sick days. Your business is growing. Maybe it’s time to offer more.
Why employee benefits are important to employees
Many fringe benefits are a way for employees to obtain the things they want or need without having to deplete—or at least seriously deplete—their paychecks.
What benefits do your employees want?
According to SHRM’s 2025 Employee Benefits Survey, health-related benefits by far are the most desired (88%), followed by retirement savings and planning advice (81%), and leave benefits (81%).
Just so you know what other benefits are desired by employees, the SHRM survey found:
- Family-friendly benefits (67%)
- Financial (nonretirement) benefits (53%)
- Wellness benefits (47%)
- Education benefits (40%)
- Technology benefits (35%)
- Transportation benefits (13%)
- Housing and relocation benefits (10%)
Ways to arrange benefits in a more cost-effective way
Even though your business may be growing, it may not have the ability to pay for all of the benefits you’d like to offer to your staff. Consider opting for some benefits that can be paid by employees on a pre-tax basis. This means they pay for the benefits, but the salary or wages used for this purpose are not considered taxable income. What’s more, in most cases, the pre-tax contributions are not subject to FICA…a savings for both the employee and the employer.
Example: Say you offer a dependent care flexible spending account (FSA) for 2026—a pre-tax option—with a contribution limit of $7,500 (the limit for 2025 is $5,000) and an employee in the 22% tax bracket takes full advantage of this option. Remember there’s a 7.65% FICA tax too. This means the employee without the dependent care FSA option would need to earn $10,663 to net $7,500 for dependent care expenses. And the company saves about $574 for the employer’s share of FICA.
Options for pre-tax benefits
Here’s a list of some of the benefits that can be arranged for your staff on a pre-tax basis.
- Dependent care flexible spending account (dependent care FSA).
- Health flexible spending account (health FSA).
- Monthly transit passes
- Certain retirement plans. Employee contributions are salary reduction amounts added to 401(k)s, SIMPLE-IRAs, and starter 401(k)s.
Options for no-cost benefits
The SHRM survey found that 68% of employees desired flexible working benefits. This may encompass flex time, remote work arrangements, or part-time work. Other than possible administrative costs, no extra dollars are needed to offer flexible working benefits.
Another highly-desired benefit is professional and career development benefits. Employers don’t necessarily have to pay for employees’ education assistance. Career development can take the form of mentoring, where seasoned employees guide and teach newer workers. Again, no extra dollars required here.
You can also offer employee discounts for the goods and services your company sells. If you fall within IRS guidelines, employees are not taxed on the discounts.
Final thought
“Your employees need more than just paychecks.” ~ Pooja Agnihotri, author of 17 Reasons Why Businesses Fail
Expanding your menu of benefits doesn’t have to happen all at once. As your business grows, you can scale your offering. Add a new benefit for 2026, and another the following year if your business plan permits. Find more about the tax rules for employee benefits in IRS Publication 15-B (the publication for benefits in 2026 is not yet available). Use your imagination to enhance what you do for your staff.
Find more blogs about scaling your business in this list here.
