With the aim of addressing the cost-of-living crisis, social partners have sent a joint letter to the Minister of National Economy and Finance, calling for the increase of the tax-free daily limit for meal benefits (meal vouchers) for employees from €6 to €10.
It should be noted that today the meal card can amount to up to €132 per month, while higher amounts are subject to taxation and social security contributions.
The truth, of course, is that the issue concerns mainly large companies that prefer to offer employees additional benefits in the form of meal and fuel vouchers, benefits in kind and bonuses instead of salary increases, with both sides seeking mutual benefit.
In other words, companies avoid the additional burden of non-wage costs, while employees “save” on deductions that reduce their take-home income. It is well known that non-wage labor costs remain high in Greece, prompting companies to look for alternative ways to compensate employees outside of their regular salaries.
For example, if an employee earning €2,000 receives a €100 raise, the employee will pay €51 in deductions, the employer €122, while the state will receive €62, meaning more than the employee.
As a result, benefits in kind have become an attractive solution for companies that are reluctant to grant salary increases because high social security contributions and taxation can, in many cases, effectively erode the net value of those increases.
Of course, as trade union representatives point out, if a large industrial company turns to benefits in kind instead of paying overtime, this may conceal undeclared work. At the same time, an employee who loses social security contributions may face difficulties in building an adequate pension by the end of their working life.
What benefits do companies offer?
According to a study, most companies (60%) offer a private retirement plan to at least one category of employees, with 83% of companies providing these private plans to employees immediately after they are hired.
Benefits in kind include meal and fuel vouchers, mobile phone expenses, company cars, insurance plans, remote working, as well as “wellness and skills” benefits.
According to a Randstad survey, training is the most popular benefit offered by companies, at 78%, followed by the option of working from home (58%), flexible working hours (41%), and even additional days of leave (37%).
As for monetary benefits, three out of four companies provide a mobile phone and performance bonuses, 64% offer private health insurance policies, 61% provide meal vouchers, and 52% offer a company car.
- Benefits instead of salary increases: Why companies are turning to meal vouchers and bonuses appeared first on - English.