Employees’ benefits are the payment to the company’s employees, not only their salary but also other expenses that are directly attributable to workers such as:
- Social security.
- Rewards and prizes.
- Workers insurances.
- Other costs.
You should keep the distinction between:
- Gross salary: nominal value of the paycheck, before tax deductions and individual social security.
- Gross income: total income received by an employee, before individual tax withholdings and individual social security.
- Net individual income: total income received by an employee, after individual tax withholdings and individual social security.
- Total cost for the company: total expenses that the company has paid to a worker, plus company social security and other costs.
Individuals are usually concerned about their net individual income, meaning the amount that they are bringing home. Companies need always to look for the total cost of the individual.
The employees’ benefits only includes workers on contract. It does not include expenses of outsourced workers or of those that are on some sort of fees. Outsourced workers and workers by fees are commonly included as operating expenses.