Today’s Millennials and Gen Z prioritizes work-life balance and company benefits over high salaries. As such, employee benefits are a key factor in job selection and retention.

In this article, we’ll explore the essential HR function of managing employee benefits, best practices for effective administration, and trending welfare programs that modern employees value.

Employee benefits refer to various non-wage perks provided to employees, including monetary gifts for family events, education subsidies, access to vacation facilities, special leave, and flexible work options. These programs aim to enhance employee well-being and work conditions. With lifelong employment becoming less common, HR teams are increasingly focused on expanding or restructuring benefit offerings.

As benefits become a more critical aspect of HR operations, they are closely linked to overall human resource management. Benefit administrators now oversee program planning, vendor negotiations, internal communications, and benchmarking to ensure the system meets both company goals and employee expectations.

Through ongoing communication with staff, HR aims to manage benefits in a way that positively impacts employee engagement and workforce management.

• Increased employee satisfaction and loyalty
• Enhanced productivity
• Improved employer branding
• Talent attraction and retention
• Compliance with labor laws and risk reduction
• Stronger team collaboration and morale

Strategic and structured approaches are essential for managing modern employee benefits. Before designing a benefits plan, HR should distinguish between statutory and non-statutory benefits to ensure compliance with legal requirements and tax regulations.

Statutory benefits include health insurance, retirement plans, employment insurance, and workers’ compensation. Non-statutory benefits may include housing support, on-site childcare, monetary gifts for life events, resort access, flexible leave, and welfare points.

A clear budget is also crucial. HR must coordinate with management to determine a sustainable welfare budget that aligns with business operations and wage policies. Once the budget is confirmed, welfare programs should be designed based on company direction, employee demographics, and preferences.

Consider the following strategies to enhance organizational competitiveness through well-managed benefit programs:

1. Ongoing Employee Feedback: Gather feedback to assess existing benefits, identify areas for improvement, and increase participation and satisfaction.
2. Online Platforms: Use welfare platforms or point systems to make benefit offerings visible and easily accessible.
3. Internal Marketing: Promote benefit programs through internal announcements or campaigns to improve awareness and usage.
4. Personalized Benefits: Tailor programs to employee characteristics and lifestyles.
5. Legal Updates: Inform employees promptly of changes to statutory benefits or related regulations.
6. Trend Monitoring: Benchmark against competitors and respond to social trends (e.g., work-life balance, shared parenting) by updating programs such as flexible hours or parental leave.

Modern employees increasingly value autonomy over rigid 9-to-6 work schedules. Companies offering remote work, flextime, and hybrid setups are more attractive. Providing flexibility empowers employees to manage their own schedules and maintain work-life balance.

Examples include Johnson & Johnson Medical Korea's “twice-a-week remote work,” POSCO's “optional 4-day workweek every other week,” and T1LS’s flextime system for all staff.

Extended leave options—such as sabbaticals for personal development, travel, or caregiving—are gaining popularity. Some companies offer extra days off beyond annual paid leave to long-term employees.

Employees are increasingly focused on holistic well-being. To support this, companies are introducing health and wellness programs such as on-site gyms, nutritious cafeterias, counseling services, and massage chairs.

A successful employee welfare program requires both company commitment and employee engagement. HR teams should stay informed on societal trends and consistently communicate with staff to design programs that benefit both staffs and management.

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