Question

Why is indirect compensation important to recruiting and retaining employees? (site 1)

Answer 1

Indirect compensation includes non-wage compensation to employees that are outside of their normal wages or salaries. These benefits may include health insurance, tuition funding, educational opportunities, daycare, vacation, as well as flexible work schedules. They are often not taxable, and provide important assets to companies looking to attract quality employees at different stages in their careers. A good example is health insurance. With the national debate on health care, quality affordable health insurance for employees and their families is a very important tool to attract employees.