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Employee Discounts
Employee discounts are special offers or perks employers provide to their employees, allowing them to purchase goods and services at a discounted rate. These discounts can range from a percentage off the regular price of products and services to exclusive access to certain deals and promotions.
Employee discounts can be offered on various products and services, including clothing, electronics, travel, entertainment, and more. By offering employee discounts, employers can
- Improve employee satisfaction
- Increase employee retention rates
- Help increase employee savings
- Provide additional benefits to their workforce
What are employee discounts?
Employee discounts are special perks or benefits employers offer their employees, allowing them to purchase goods and services at discounted rates. Employee discounts can be offered on various products and services, including clothing, electronics, travel, and entertainment.
What is the meaning of staff discount at work?
A staff discount is another term for an employee discount. It refers to the reduced prices or special rates that employees receive from either their employer’s own products/services or through affiliated partner networks. These are typically offered as a benefit of working with the company.
What is the limit on employee discounts?
There’s no universal limit on employee discounts—it depends on company policies and tax regulations. For example, in the U.S., Internal Revenue Code Section 132 allows certain qualified discounts without tax implications, up to:
- 20% off for services
- Discounts on property not exceeding the employer’s gross profit margin
Always check local labor and tax laws for specific thresholds.
What are the three types of discounts?
The most common types of employee discounts include:
- Merchandise discounts: Reduced prices on products or services, often from the employer or partner brands.
- Fringe benefits: Allowances for meals, fuel, wellness, upskilling, and travel, often delivered via prepaid cards or portals.
- Perks and offers platforms: Access to curated deals via an employee discount website, covering a broad marketplace of brands and services.
What is an example of a qualified employee discount?
A qualified employee discount could be a 15% discount on gym memberships, books, or meals purchased through a platform partnered with the employer. These are structured to remain within taxable thresholds and are often part of a fringe benefit or lifestyle spending account (LSA) program.
Why do employers offer employee discounts?
Employers offer employee discounts to provide additional benefits, improve employee satisfaction, and boost employee morale. Offering employee discounts can also help attract and retain top talent.
How do employee discounts work?
The specifics of how employee discounts work can vary depending on the employer and the type of discount offered. Typically, employees are given a special code or discount card that they can use to receive the discount when making purchases. Some employers may also partner with specific retailers or service providers to offer exclusive discounts to their employees.
How do employee discounts benefit employers?
Offering employee discounts can benefit employers by
- Improving employee satisfaction
- Increasing employee retention rates
- Boosting employee morale
- Attract top talent
- Improve the overall reputation of the employer
Employee pulse surveys:
These are short surveys that can be sent frequently to check what your employees think about an issue quickly. The survey comprises fewer questions (not more than 10) to get the information quickly. These can be administered at regular intervals (monthly/weekly/quarterly).
One-on-one meetings:
Having periodic, hour-long meetings for an informal chat with every team member is an excellent way to get a true sense of what’s happening with them. Since it is a safe and private conversation, it helps you get better details about an issue.
eNPS:
eNPS (employee Net Promoter score) is one of the simplest yet effective ways to assess your employee's opinion of your company. It includes one intriguing question that gauges loyalty. An example of eNPS questions include: How likely are you to recommend our company to others? Employees respond to the eNPS survey on a scale of 1-10, where 10 denotes they are ‘highly likely’ to recommend the company and 1 signifies they are ‘highly unlikely’ to recommend it.
Based on the responses, employees can be placed in three different categories:
- Promoters
Employees who have responded positively or agreed. - Detractors
Employees who have reacted negatively or disagreed. - Passives
Employees who have stayed neutral with their responses.
How do employee discounts benefit employees?
Employee discounts benefit employees by allowing them to purchase goods and services at discounted rates, which can help them save money and improve their financial well-being. Additionally, employee discounts can improve employee satisfaction and morale, which can lead to improved job performance and career advancement opportunities.
How to start an employee discount program
Starting an employee discount program can help you attract and retain top talent, boost employee morale, and improve overall job satisfaction. Here are some steps you can follow to start an employee discount program:
- Define the program's scope: Determine which products and services will be included, and set guidelines around the discounts offered.
- Set a budget: Determine how much your company can afford to invest in the program and limit the discounts offered.
- Research and negotiate with vendors: Identify vendors willing to offer discounts to your employees and negotiate the terms of the discounts.
- Develop marketing materials: Create marketing materials to promote the program to your employees, such as flyers, email announcements, and social media posts.
- Communicate with employees: Inform your employees about the program, including how to access the discounts and any guidelines or limitations around their use.
- Monitor and evaluate the program: Track usage of the program, gather feedback from employees and assess its effectiveness in achieving its goals.
How to get employee discounts?
Employees can access discounts through:
- Internal benefits portals
- Prepaid benefit cards
- Curated employee discount websites
- Partner brand codes via HR or intranet
- Reward redemption platforms with cashback, vouchers, or offers
With platforms like Empuls, these are accessible via web, mobile, Microsoft Teams, or Slack.
Are employee discounts taxable?
The tax treatment of employee discounts can depend on the specifics of the discount being offered. In general, discounts that are offered to all employees and that do not exceed certain limits are not taxable. However, if discounts are offered only to select employees or if they exceed certain limits, they may be subject to taxation.
How can Empuls help?
Empuls simplifies and amplifies employee discount offerings with an integrated approach:
- A global employee discount website featuring 10M+ offers across 25+ categories and 150+ countries.
- Seamless administration of fringe benefits like tax-free allowances and lifestyle accounts via prepaid cards.
- Embedded in everyday work tools like MS Teams and Slack to access perks and discounts without switching platforms.
- Personalization with COLI adjustments, regional preferences, and budget management for equitable access.
Whether it's discounts on gym memberships, upskilling courses, wellness apps, or daily shopping—Empuls ensures employees save more and feel valued.
