Corporate welfare is an increasingly relevant concept in the modern world of work, but what exactly does it mean and what are its benefits for employees and companies?
In this article, we will explore corporate welfare in detail, explaining what it is, how it works and what benefits it offers for both employees and businesses.
We will also understand how company welfare plans are delivered and how to activate them successfully. But let’s start with the basics...
What is corporate welfare?
Corporate welfare is a set of services, benefits and initiatives offered by a company to its employees beyond the basic wage.
These additional benefits may include health care, physical and mental health services, training, meal vouchers, nurseries, various types of shopping vouchers and many other forms of support.
In essence, the aim of corporate welfare is to improve the quality of life of employees and help create a more satisfactory working environment, offering tangible and concrete support for a better work-life balance.
What does the term "welfare" mean?
The term "welfare" comes from the English word "well-being," meaning "welfare".
In the corporate context, welfare refers to all the initiatives and benefits that a company offers its employees to improve their well-being and quality of life.
These benefits can vary greatly from company to company, but the main goal is always the same: to create a workplace where employees feel valued and supported.
What is corporate welfare for?
Corporate welfare serves multiple purposes.
First, it helps to improve employee satisfaction and motivation.
When employees feel supported and feel that the company is concerned about their well-being, they tend to be more engaged and productive, as well as closer to the business cause.
In addition, corporate welfare can help recruit and retain talent, as companies that offer competitive benefits are more attractive to potential employees.
Finally, well-structured corporate welfare programs can help improve the company’s reputation and build positive relationships with the company’s community.
What are the benefits of welfare for companies?
Welfare offers various benefits to companies.
First, it can help reduce employee turnover, thus saving on recruitment and training costs.
Corporate welfare can also improve productivity and commitment (employee commitment) by reducing absenteeism and increasing efficiency.
A working environment in which employees feel valued is in fact often more collaborative and proactive, tending to be more united in the pursuit of collective goals.
In addition, companies that invest in corporate welfare can benefit from many tax breaks and provide a morepositive brand image and human centred.
Taxation for the company and the employees who benefit from the welfare
It is important to understand the tax system of corporate welfare, both for the employer and for the employees, to better understand its real benefits.
In many countries companies have the possibility to deduct from taxes the costs related to corporate welfare; which obviously makes the initiative both financially and productively beneficial.
For employees, it is essential to be aware of the tax implications of the benefits received: in many cases, benefits can be tax-free or subject to preferential taxation, but it is essential to consult a tax expert for a detailed guide.
The implementation of a company welfare plan (not subject to taxation) therefore allows companies to benefit from special tax reductions, eliminating, through this mode of delivery, the tax wedge and containing labor costs.
Let’s take an example: on a hypothetical payment of € 1,000, the employer spends € 1,000 (deductible) and the employee receives the full amount of the sum, to be spent on goods and services.
We are therefore talking about extremely tangible and measurable benefits for both parties involved.
When is welfare mandatory? CCNL that have the obligation to provide a welfare credit
The obligation to provide welfare credit varies from country to country and can be regulated by collective agreements or specific laws.
Some sectors are subject to contractual obligations, which require them to provide certain benefits to employees.
The CCNL that have the obligation to provide welfare services are the following:
● CCNL Metalworkers Large Industry
● CCNL Metalworking Industry CONFAPI (SMEs)
● CONFIRMATORY NCS (SMEs)
● CCNL Silversmith and jewellery (Federorafi)
● CCNL Agenzia Marittime
● The CCNL Data Processing Centers (CED), ICT enterprises, digital professions and S.T.P
It is therefore important for companies to be aware of the contractual and legal provisions relating to corporate welfare, which differ greatly depending on the specific application sector.
In any case, the current legislation states that it is possible to pay an amount in corporate welfare to employees in one of the following ways:
- mandatory when required by CCNL, as mentioned earlier;
- according to a union agreement, also with the possibility of converting the Result Award;
- as a voluntary contribution, paid by the company to all employees or to homogeneous categories.
Who is corporate welfare for? What are the benefits for employees?
Corporate welfare is intended for all employees of a company, regardless of their position or role.
Benefits may vary depending on your business needs and policies, but the goal is always to improve your employees' lives, during your time in the office and/or your private life.
Employees can benefit from medical services, discounts on goods and services, support for training and professional development, and much more...
These benefits clearly improve the well-being of employees, reduce financial stress and make a real contribution to improving the quality of life.
How employees can spend services/ welfare vouchers
In practice, employees who receive benefits often have considerable flexibility in deciding how and when to use these services or vouchers.
For example, food vouchers can be used to buy food both in restaurants and supermarkets; medical services can be used both for visits with a specialist and for specific treatments.
Through an online dashboard and through an app, collaborators who are beneficiaries of welfare plans can easily consult all the affiliated services and vouchers available, apply for them and/or spend the credits received.
The possibility of personalization of the offered service is an essential aspect for companies and beneficiaries, so that the welfare plan is lowered into the company’s reference reality and is really useful to employees: The latter can then finalize their plan by making specific choices, adapting the options of corporate welfare to their family needs.
What are the methods of providing a company welfare plan?
Corporate welfare plans can be provided in different ways.
Some companies offer benefits directly, for example through insurance coverage or access to in-house medical services.
Other companies instead use third-party services or specializedplatforms to manage benefits.
The advantage of relying on one of these platforms is twofold: it relieves the company of many organizational and administrative responsibilities, and allows employees to easily and intuitively access the services offered, managing them independently in a more practical and efficient way.
The choice of mode obviously depends on the needs of the company and the complexity of the benefits offered.
How to activate a corporate welfare plan
The activation of a company welfare plan always requires a planned and coordinated process.
Typically, the company must first define the benefits that it intends to offer and establish the delivery methods or be advised by a player who deals professionally with welfare plans.
Once the services have been provided, it is of course important to inform employees about these initiatives, explain how they work and finally manage their tax and administrative aspects .
The explanation of the operation to the beneficiaries is a key step: vice versa you risk frustration and misunderstanding of the efforts of the company, resulting in potential failure of the project itself.
From this point of view, we also understand how the delivery of the various benefits must be intuitive, and managed in a digital and simple way. Often, companies collaborate with consultants or specialized service providers such asEudaimon, to successfully implement their corporate welfare plan.
Types of services/ vouchers available for Welfare plans
We have talked so far about benefits and services, mentioning a few examples, but what are actually the types of services/ vouchers available for corporate welfare plans?
Corporate welfare plans are in fact much more!
They can include a wide range of vouchers, fringe benefit/ services. Here are a few...
● Healthcare
● Insurance cover
● Food stamps
● Shopping vouchers, fuel vouchers and shopping vouchers
● Financial advisory services
● Vocational training and development
● Crèches or childcare services
● Services for physical and mental well-being
● Various discounts on products and services
● Aid for transport
● Claims for reimbursement of expenditure already incurred in the areas of home, family, education, public transport and health
● Health, tourism, sports, cultural and leisure vouchers
● Opportunities to allocate credit to supplementary health and pension initiatives
Moreover, the credit of the corporate welfare plan is not only usable by the receiving workers, but also by their immediate family members.
The choice of benefits therefore depends on the needs and priorities of the company and its employees. The welfare program must be studied and customized, so that it really succeeds.
In conclusion, corporate welfare is an essential element to improve the welfare of employees and promote a positive working environment.
By offering competitive and well-planned benefits, companies can enjoy significant advantages in terms of tax, productivity, personal networks and business reputation.
Effective corporate welfare management requires careful planning and an understanding of the tax and legal implications, but the benefits for companies and employees are substantial and measurable.