Which Employee Benefits are Legally Required and Which are Optional?

employee-benefitsWhile there are many questions that employees may have regarding the jobs they hold, questions regarding legally required employee benefits tend to be plentiful. If you are looking for clarity regarding legally required employee benefits, the information found below can be of great benefit to you.

Social Security Taxes

As noted by the SBA.gov, every employer is required to pay social security taxes based on the rate their employees pay. In order to be in compliance with the law, there are a plethora of sites which employers can reference, including SocialSecurity.gov.

Workers Compensation

Businesses are required to carry Workers’ Comp Insurance, and they have several options. Some of them include offering coverage on a self-insured basis, through a commercial carrier, or through the state’s official Workers’ Compensation Insurance program.

Disability Insurance

There are several states and territories that have made it mandatory for businesses to provide employees with partial wage replacement insurance coverage for sicknesses and/or injuries that are not related to work:

  • California
  • Hawaii
  • New Jersey
  • New York
  • Puerto Rico
  • Rhode Island

Leave Benefits

In most cases, the leave benefits offered by employers are not federal requirements. Generally, these benefits are offered to a business’s employees as an aspect of the employer’s overall benefits and compensation package. Some of the leave benefits an employer may offer include jury duty, holiday/vacation, sick leave, funeral/bereavement leave, and personal leave. While these benefits are optional, every employer is required to offer leave under the Family and Medical Leave Act (FMLA).

Family and Medical Leave

The Family and Medical Leave Act (FMLA) ensures that employees can obtain up to twelve weeks of unpaid, job-protected leave during a twelve month period as long as the reason pertains to one of the following:

•Birth and care for the employee’s child
•Foster care or adoption placement for a child
•Care for an immediate family member (parent, child, spouse) with a serious health issue
•Care for an employee’s own serious health issue

Additionally, FMLA has made it mandatory for employers to ensure that their employees maintain group health benefits during their leave. The rules and regulations outlined by FMLA are applicable to both private employers who have 50 or more employees and all public employers.

Resource: Returning to Work After Baby

Health Insurance

As Alison Doyle notes in her article “Legally Mandated Employee Benefits,” employers do not have to offer health insurance coverage to their employees, although of course many do. Typically, what type of health insurance an employee gains results from his or her negotiating with the employer.

Other Employee Benefits

Although they are not always thought of as a “benefit,” minimum wage and overtime pay are also required by law.


As made plain by the information listed above, employees are entitled to a variety of benefits which employers are required to offer by law. By reading the information found above, you can gain a better understanding of which employee benefits employers should be providing.

Related Resource: 20 Companies With the Best Benefits