Discretionary benefits: trends for 2025

To attract and retain the best talent, companies are increasingly investing in discretionary benefits as a strategic way to stand out as an employer of choice and to enhance employee satisfaction. As they gain momentum, Careerminds investigates the key trends shaping their evolution in 2025.

Once seen as a nice-to-have workplace perk, discretionary benefits are not a legally-mandated employee offering. While businesses are obliged to provide benefits such as paid sick leave and shared parental leave, discretionary benefits are additional, voluntary perks that businesses can choose to offer. 

Discretionary benefits can include health insurance, retirement plans, outplacement services, and wellness programmes. There are no set requirements; employers can choose which specific benefits would align best with their workforce needs and their organisational goals – and, of course, their budgets. 

From an HR perspective, discretionary benefits can help to retain talent, boost morale among existing staff, and increase employee satisfaction. They’re a great way of developing a competitive advantage whilst also fostering a more engaged workforce. 

Popular benefits include: 

• Health and wellness programmes such as subsidised gym memberships, health screenings, and access to mental health resources 
• Paid time off can be offered in addition to the mandated leave allowances, and range from a few days’ extra annual leave to unlimited time off
• Professional development is a popular benefit which enables employees to upskill and progress their careers, with benefits such as access to online learning, in-house courses, mentoring, and tuition reimbursement
• Flexible working enables a better work-life balance and can incorporate remote or hybrid options, flexible hours, or condensed work weeks
• Childcare is sometimes provided in the form of on-site nurseries or daycare subsidies
• Employee recognition schemes can boost engagement through incentives such as bonuses and awards
• Staff discounts on company products or local services can be a welcome benefit

The main difference between the two types of benefits is in the employer’s obligation to provide them. Non-discretionary benefits are legal requirements, covered by the Employment Act, providing employees with basic protections such as income security, a safe workplace, retirement benefits, and health cover. 

Discretionary benefits, on the other hand, can be decided by the employer. They aren’t legally mandated and are used to gain a competitive edge in the job market. 

Discretionary benefits and fringe benefits are very similar, but they differ in terms of obligation, consistency, and expectation. Fringe benefits are usually provided to all employees as part of HR policy, or as part of the employment contract. Discretionary benefits may only apply to employees in certain roles, or with a certain level of seniority, and could change or stop at any time. 

There’s a wide range of discretionary benefits to choose from – some traditional and some more innovative – so Careerminds has examined the main trends for 2025:

Employers understand the impact of poor mental and physical health on their workforce better than ever before. By addressing issues such as burnout and stress, employers can build healthier, happier workforces with greater productivity and fewer absences. 

Discretionary health and wellness benefits can include health insurance, gym memberships, mindfulness apps, mental health resources, dental cover, on-site fitness classes, healthy snacks, counselling, and ergonomic equipment. 

Since the pandemic, employees have increasingly prized flexibility in their work. As many employers push staff to return to the office, companies wanting a competitive advantage and access to a wider talent pool are embracing remote and hybrid working. 

Flexible working benefits can include home office stipends, flexible working hours, compressed work weeks, work-from-anywhere policies, and job shares.

The world is facing unprecedented economic upheaval, and financial security is a growing concern. Employers that understand and address this will have the upper hand in talent attraction and retention. By easing financial stress, businesses can improve employee wellbeing and, ultimately, performance. 

Financial wellness perks could include access to financial advisors, personal finance workshops, salary advances, education on cryptocurrencies, and savings plans. 

Career growth is increasingly seen as a valuable discretionary benefit. HR teams now offer tailored development opportunities, enabling employees to align their career with the needs of the company and to benefit from a progressive career. The business, meanwhile, benefits from loyal and skilled staff.

Benefits include access to AI-driven training platforms, industry accreditations, mentoring programmes, SkillsFuture credits, sponsorship of academic courses, in-house learning, study leave, soft skills development, leadership programmes, job rotations, and technical training. 

Employees are increasingly looking for meaning and purpose in their work. Socially responsible businesses, offering sustainability-based perks for environmentally-conscious employees, can benefit here whilst building their reputation as a values-driven employer of choice.

Initiatives cover cycle schemes and electric vehicle subsidies, carbon offset programmes, paid volunteering days, EV charging, plastic-free policies, zero-waste initiatives, and donation matching to green organisations.

Discretionary benefits are no longer optional perks – they’re a necessary part of a company’s strategic toolkit, promoting a thriving, productive workplace while helping to attract top talent. By carefully tailoring benefits to the needs and expectations of its workforce, a business can foster loyalty, improve morale, and gain a competitive edge. 

Trends for 2025, such as mental health support, flexible working, and purpose-driven benefits, highlight the evolving priorities of employees and employers alike. To stay ahead in the market, companies need to embrace new, innovative ways of enhancing the employee experience. 

With financial security and mental wellbeing now a top priority, outplacement services should also be considered as a desirable discretionary benefit. Economic uncertainty means that no job is 100% secure any more. Should the worst happen, your company can retain its reputation and continue to support its workforce. 

Outplacement offers job-search advice, CV and LinkedIn profile writing, interview coaching, and emotional wellbeing support, enabling your staff to transition quickly and easily into new roles should retrenchments become necessary. 

Contact us today to find out how we can partner with your business. 

Jen David

Jen is a careers writer and CV specialist, with many years’ experience writing for leading careers platforms and her own business, CV Shed. She loves to support job seekers in progressing their careers, whether they’re looking to step up the ladder, take a sideways move, or change career entirely. She writes attention-grabbing CVs that show off her clients’ expertise and their value to a business, helping them to secure new roles quickly.

Jen also writes SEO blog content on a wide range of careers topics, for clients in the UK, US, Singapore and Australia. She has produced over 300 articles to date and also edits the work of other writers. She maintains her own blog to support job-seekers with up-to-date, best practice information on CVs, LinkedIn profiles and other related topics, and has a book available on Amazon Kindle, How to write a CV for the modern job market.