If you’re responsible for designing employee benefits strategies in a global organisation, you already know: offering benefits is more complex than it’s ever been. The question is no longer just about offering good benefits — it’s about offering the right ones, and knowing where perks fit in.
Too often, “benefits” and “perks” get used interchangeably. But for senior HR and Reward leaders, especially at enterprise level, that confusion can have serious consequences when it comes to global strategy, cost-effectiveness, and impact.
Here’s why understanding the difference matters and how to get both right.
What Are Employee Benefits?
Employee benefits are forms of non-cash compensation, typically tied to employee welfare and security. They’re a critical component of the total rewards package and, in many cases, mandated by law.
The most common categories of benefits include:
- Health benefits (medical, dental, mental health support)
- Financial benefits (pensions, life insurance, income protection)
- Workplace benefits (annual leave, sick pay, parental leave)
- Lifestyle benefits (cycle-to-work schemes, travel subsidies)
- Salary sacrifice schemes (EV leasing, childcare vouchers)
- Flexible benefits platforms (choice-led marketplaces for personalised needs)
For multinational organisations, this isn’t just about policy. It’s about compliance and risk management. Consider:
- In the UK, auto-enrolment pensions remain mandatory. Statutory sick pay, parental leave, and holiday entitlement are non-negotiable.
- In Germany, health insurance must be provided.
- In the US, benefits are often leveraged for competitive advantage because fewer protections are state-mandated.
Global compliance complexity is only increasing. The EU’s 2024 Equal Pay Transparency Directive, for example, is already influencing how benefits and pay structures must be reported and benchmarked.
📊 78% of employees say benefits influence their decision to accept a job (EBRI, 2024).
📊 65% say benefits influence whether they stay (MetLife Employee Benefits Trends Report, 2025).
What Are Employee Perks?
Perks are discretionary extras offered to enhance morale, engagement, and employer branding. They’re not linked to compliance, and typically aren’t included in total compensation calculations.
Examples include:
- Gym memberships
- Retail discounts
- Free lunches
- Wellness allowances
- Company retreats
- Learning stipends for non-essential skills
Done right, perks can boost culture and engagement. But they can’t replace core benefits.
Why the confusion? Some perks feel like benefits. A free lunch? It’s nice. Private medical? That’s life-changing. The impact is simply not comparable.
Benefits vs. Perks: What’s the Difference?
Benefits are often legally required. They protect health, income, and long-term security. They are critical to recruitment and retention and typically appear in formal total reward statements.
Perks, on the other hand, are entirely discretionary. They exist to boost morale and enhance the employee experience. Perks help build engagement and strengthen company culture but are rarely monetised or included in formal compensation reporting.
If you’re building a global benefits strategy, this distinction matters. Benefits must be robust, equitable, and localised to meet compliance and employee expectations. Perks can flex more freely around culture, creativity, and budget.
In 2025, smart organisations are focusing on benefits as the infrastructure of their people strategy and treating perks as the seasoning that enhances, not replaces, the core offer.
Compliance First: Mandatory Benefits by Market
Here’s a snapshot of mandatory benefits across key markets in 2025:
- United Kingdom: Pension auto-enrolment, statutory sick pay, holiday entitlement, and parental leave are all required by law.
- United States: Varies by state, but healthcare provision is often expected and highly valued in competitive markets.
- Germany: Employers must provide health insurance, pension contributions, and statutory parental leave.
- France: Employers are required to offer health insurance, paid leave, and pension contributions as standard.
These form the foundation of any benefits strategy and must be prioritised before additional offerings are layered on top.
The Global Perspective: Why This Distinction Matters More for Enterprise
Globally dispersed teams demand a nuanced approach. What feels like a perk in one market is an expectation in another. For example:
- In the US, health insurance is a top-tier benefit.
- In the Nordics, healthcare is state-provided; wellness budgets are the differentiator.
- In Singapore, childcare support is increasingly expected due to cost pressures.
For enterprise HR and Reward leaders, harmonising global benefits with local flexibility is the challenge. It’s no longer about offering everything everywhere — it’s about meeting statutory obligations, aligning to local norms, and giving people meaningful choice.
62% of CHROs globally cite “meeting diverse expectations” as their biggest benefits challenge in 2025 (read more about this in our Global State of Benefits Report).
Why Benefits Still Beat Perks for Retention and ROI
Retention risk is rising. Gallup’s 2025 Global Workplace Report found that 51% of employees are actively or passively looking to leave their employer. Benefits have a proven role in mitigating this:
- Financial security schemes (pensions, insurances) boost tenure.
- Healthcare and wellbeing provision reduces absence and increases engagement.
- Strong parental policies improve gender equity and retention.
Perks alone won’t fix a broken benefits strategy. Your team might love free yoga — but if they can’t access adequate healthcare, they’ll leave.
A benefits-first strategy demonstrates commitment to long-term welfare. It signals that you care about the whole employee, not just their output.
How to Evaluate Your Benefits Strategy in 2025
If you suspect your offer leans too heavily on perks over benefits, ask:
✅ Are our core benefits globally compliant and competitive?
✅ Are we aligning benefits to local expectations and benchmarks?
✅ Do our benefits directly improve financial, mental, and physical wellbeing?
✅ Are our perks enhancing — not masking — our benefits offer?
✅ Are we measuring impact through engagement, retention, and satisfaction data?
Practical Tip: Use a benchmarking tool like Ben’s Benefits Benchmarking Tool to audit your offer.
Build the Foundation First
Perks are still valuable for boosting engagement and culture. But they can’t carry your EVP alone. Benefits are what show employees you’ve got their backs, today and tomorrow. In a world of increasing compliance scrutiny and evolving employee expectations, getting your benefits house in order should be your first priority.
Only then can perks play the role they’re best at: adding delight to an already solid foundation.