Many companies from the private banking industry, law firms, and employers from the finance profession offer several extralegal benefits. You have the right to ask yourself if it is not better to simply choose a higher gross salary. Whether you are changing jobs or are new to the job market, you should not just consider your base salary. Indeed, it is important to cover your monthly expenses but there are also many other aspects to consider.
Even if the European countries tend to practice the same social policies for their employees, it is in your best interest to consider the situation as widely as possible and to correctly assess what exactly benefits suits you the best.
The 10 most common extralegal benefits
There are many extralegal benefits that you can be entitled to depending on your where you live. Their ranking may vary from year to year, but the first benefits of this list are the most sought after:
- Meal vouchers
- Group insurance: increases your supplementary pension
- Hospital insurance: your employer takes care, totally or partially, of your hospital bills
- Eco voucher: to purchase eco-friendly products and services
- Free access to public transportation: your company pays for your public transportation fees if you don’t own a personal or company car
- Opportunity to work from home: a mobility benefit which is increasingly sought after
- Company vehicle with fuel card
- Mobile phone subscription
- Reimbursement of your Internet connection
Extralegal benefits can be collective or individual
Extra-legal benefits agreements are not always collectively concluded. For the companies it is important to consider extralegal benefits versus gross pay in terms of the perception of their employees. Some of the proposed benefits, such as meal vouchers or group insurance, are offered collectively but today, there is also a growing demand for these benefits to be more flexible. This need for greater individualisation, mostly due to millennials new social needs, drive the companies to work with budgets that empowers employees to decide for themselves the benefits that can be well suited to their personal social position.
Group insurance, a real advantageous benefit
Group insurance has two advantages. For the employer this is a relatively inexpensive way to give yourself a raise. He will be taxed less heavily on your group insurance than on the net salary he pays you. You also can enjoy significant benefits: As you might know, the European system of legal pensions is far from good. Future retirees may well pay the price for this cautious situation. Group insurance therefore allows you to count on a higher pension. The extralegal pension that you might receive through group insurance is slightly taxed and the premiums you will have to pay can be deducted from your taxes. Do not forget that the coverage of most group insurance also covers your family. Since group insurance is a form of deferred compensation be conscious that you will only receive this money when you retire.
Employers tend to encourage mobility
Nowadays, employers, as well as employees, seek to optimize mobility. Companies may choose a mobility budget that is adapted to the employee. She or he might be driving cars and bicycles on leasing, use public transportation and so on. Working from home is also part of this new mobility approach but it is a comfort that has no price. It is up to the employee to get organized in order to really benefit from this home working formula.
There is an impact on your pension
Extralegal profits are not included in the calculation of pensions. You do not consolidate your pension with extralegal benefits as you do with a salary but there are certain advantages. If, for example, you are already covered by hospitalization insurance through your partner’s work, then the hospitalization insurance included in your salary package is interest-free. You must also consider the impact on your holiday pay and your end-of-year bonus: If you opt for lower wages with more extra-legal benefits you will get fewer paid holidays for instance.