Compare two different types of benefits offered by organisations and the merits of each. (ac 1.4)

Compare two different types of benefits offered by organisations and the merits of each. (ac 1.4)

Organisations offer a range of benefits to attract and retain employees, and these can be broadly classified into two categories: the tangible and the intangible benefits. Tangible benefits are those that involve costs that are clearly given in terms of monetary value while intangible benefits are those that contribute to the overall health and well-being of employees and also their satisfaction, such as flexible work schedule and professional development opportunities.

Tangible Benefits:

• Salary and Bonuses: Tangible benefits such as salaries and bonuses provide a financial return for the employee’s work. Offering competitive salaries and bonuses can be a key driver of employee satisfaction and motivation
• Health Insurance: The comprehensive insurance is a key benefit that includes medical treatment expenses and often means peace for both the employee and his/her family. The health insurance offered by an outfit may highly influence an employee capability to deal with health problems.
• Retirement Plans: Employees are often attracted to retirement schemes especially those which include employer matching contributions as they secure their financial needs in the old age. The average matched amount from an employer to an employee’s contribution on a 401(k) was 4.5%. The results mean that if the employee contributes a dollar to the 401(k), the employer will contribute 4.5 cents more.

Intangible Benefits:

• Work-Life Balance: In addition to tangible benefits such as flextime, telecommuting options, and parental leave policies, the intangible ones also can assist employees to achieve a better work-life balance which is all the more important to workers today. This added advantage can assist individuals in the administration of both personal and professional commitments without compromising either of them.
• Professional Development: This is a great incentive as employees look to augment their career and skill development by getting access to training and educational opportunities. These schemes include training programs, mentoring, or providing professional certifications can help employees to create job satisfaction and loyalty.
• Employee Resource Groups: The organisation, through the employee resource groups, may create a platform for diversity and inclusion hence allowing a sense of belonging and inclusivity in the organisation. Apart from being a forum for employees to connect and exchange ideas, such groups can also provide a perfect network.

The significance of each category of benefits is case-specific and dependent on the individual requirements and situation. An example is that a younger employee with a growing family may appreciate the flexibility that working from home offers and work-life balance options; whereas a mid-career professional may focus on financial security provided by a good retirement plan and health insurance. In addition to this, the benefits that are not tangible such as work life balance and professional development vary from one employee to another and are subjective therefore depending on an employee’s personal values and aspirations.
Comparing between two different kinds of benefits offered by an organisation, the target employees’ needs and preferences should be taken into account. To be an appealing and complete total rewards scheme, there is a need for the organisation to strike a balance between the tangible and intangible benefits so as to cater for the diverse needs of its workforce.

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