Discount for Employees: Everything You Need to Know

Discount for Employees: Everything You Need to Know
Last Updated: July 19, 2023

The Internal Revenue Code defines an employee discount as "the amount by which the price at which the property or services are provided by the employer to an employee for use by such employee is less than the price at which such property or services are being offered by the employer to customers."

Employee discount programs have grown increasingly popular in several businesses. According to statistics under Convince and Convert, about 93% of shoppers use a discount code every year. Everyday savings can pile up yearly to significantly improve your employees' financial well-being. Most businesses operate in an atmosphere where a well-educated workforce has grown to demand a full benefits package. Indeed, the lack of a discount for employees program can substantially impair a company's capacity to attract and retain talented employees. A study on employee retention found that compensation, salary, or monetary benefit such as a discount for employees assist in retaining employees.

Discount for employees programs are an important component of the employer-employee relationship. It is not always simple to attract and retain talent. Talent may quit your organization for rival companies that provide attractive employee discounts. According to research under MetLife, 73 % of employees would be encouraged to stay with their current employer longer if offered more benefits such as a discount for employees package.

Related: Tesla Employee Discounts

Employee Discount Examples

Employee Discounts on Medication


Workers appreciate companies that care about their health and financial stability. After the COVID-19 pandemic, the element of worker health accelerated. As a result, investing in discount benefits in medication and health facilities reduces turnover and increases employee loyalty and engagement. In a study under MetLife, it was found that employees are now 26% more likely than before the COVID pandemic to accept a new role because of the health programs it offers.

The mental wellness of your employees is critical, and a discount for employees program can come in via this angle. There are various strategies to reduce the cost of mental health care, including having access to on-call counseling and counsellors or using telemedicine. Employees can chat privately with a skilled professional about any difficulties causing them stress. Employee Assistance Program is ideal for this employee discount program and is becoming increasingly popular. According to the 2019 Society for Human Resource Management (SHRM) survey, 79% of employers offer an EAP.

Employee Discount Examples: Discount cards

According to a 2022 study by the National Retail Federation, 67% of retailers in the US offer employee discount cards. A discount for employees can then be obtained via a specific discount portal. Other examples of employee discount cards include gift cards, vouchers, and e-vouchers, which employees can purchase and receive more voucher value than they paid in cash.

A discount card for in-house goods and services may also be a good option. Rewarding your employees while increasing your bottom line is critical by providing them with unique corporate goods and service. Companies like Amazon already offer in-house discounts. The discount for Amazon employees varies depending on the product or service. Amazon employees can save up to 10% on Amazon products. Google also offers employees a discount of 20% on most of its products, including in-house goods like Google Pixel phones and Nest smart home devices.

Related: Discounts for Amazon Employees: Everything you need to know

Employee Discount Examples: Learning and Development

A learning and development budget is an excellent approach to upskilling your personnel while demonstrating your dedication to their personal growth. A Society for Human Resource Management study found that 62% of employers offer some tuition reimbursement program. A more skilled and capable workforce is advantageous to any company. Furthermore, job satisfaction and motivation increase when a company invests in employees' professional development. This study shows the association of training satisfaction with the employee development aspect of job satisfaction. Overall, training satisfaction was found to have a significant positive association with the employee development aspect of job satisfaction. 

The significance of a learning and development budget as part of a discount for workers program varies by industry. Let us take the educational sector as an example; high-quality performance is demanded by education consumers and confronted by rapid changes in knowledge, technology, and even academic work. This forces the educational sector to capacitate its employees. According to research done on Training and Development and Job Satisfaction in the Education Sector, higher educational institutions must redefine themselves, and, in essence, that means the faculty must either face obsolescence or continuously participate in developmental activities.

Employee Discount Examples: Retail Discount Vouchers

According to coupon code statistics, distributing coupon & discount codes is one of the best ways to improve brand awareness and customer engagement. Retail discount coupons to local establishments are an excellent method to demonstrate your concern for your employees' needs and win their loyalty. You may have your employees list their favourite discount categories and stores where they frequently shop.

Standard savings include movie and event tickets, meals, spa and gym memberships, and cleaning and laundry services. Companies like Amazon have programs where employees can save money on various goods and services, called Amazon Extras Program. Furthermore, some groups organize discount schemes in supermarkets, pharmacies, gas stations, and motels. You can negotiate price reductions and loyalty card programs with the stores on the list. To avoid haggling with a store, purchase gift cards in advance and have the recipient use them at their leisure.

Employee Discount Examples: Salary Sacrifice Scheme

A salary sacrifice scheme is another approach to providing a discount to employees. Salary sacrifice plans require employees to swap a portion of their pay for another benefit, such as money toward the lease of a fuel-efficient vehicle. Both the employee and the corporation benefit since their taxable income is reduced. Employees also like salary sacrifice packages that involve private healthcare plans. You can select from various health cash plan options, from moderately to prohibitively expensive. According to a study by the Chartered Institute of Personnel and Development (CIPD), 30% of employees in the UK are currently on salary sacrifice schemes.

Discount for Employees

Related: Nike Discounts for Employees

Advantages of Employee Discounts to the Employee

Discounted Rates on Everyday Purchases

Discounts for employees allow employees to save money on everyday expenditures like groceries, clothing, and gas. They come in as a way for employees, particularly those on tight budgets, to save money. A survey by the Society for Human Resource Management (SHRM) found that the average employee saves about $2,000 per year on discounted purchases.

Improves Employee Satisfaction

Discounts for employees result in employees feeling satisfied with their jobs. Other advantages of satisfaction include a sense of belonging. Employees have a strong bond with their organization and are generally content since they are valued. A 2017 study by the American Psychological Association found that employees who received discounts were more likely to report feeling valued by their employer.

Workers appreciate companies that care about their financial stability. As a result, investing in benefits successfully reduces turnover by increasing employee satisfaction and loyalty. A study by the Hay Group found that a 10% increase in employee benefits can lead to a 3% decrease in turnover.

Related: Target Employee Discounts

Improved Financial Wellbeing

Employee discounts make staff more affordable. Employees can now cover a variety of expenses with their salaries. This can assist employees in paying off debt and planning for retirement. This can also aid in the reduction of depression associated with financial insecurity. According to the National Library of Medicine, research, financial stress is positively associated with depression. Therefore, programs such as employee discounts would go a long way in reducing depression and stress levels.

Reduced Employee Turnover

Employee discounts boost employee satisfaction, which minimizes employee turnover because pleased employees are less inclined to leave their organizations. According to a study by BMC Nursing on the relationship between job satisfaction and turnover intention among nurses, it was found that the turnover in nurses was high and largely associated with dissatisfaction from several angles.

Increased Productivity of Employees

Employee discounts benefit the employer in the sense that the productivity of satisfied employees is higher than that of unsatisfied employees. In research done to investigate the impact of job satisfaction on workers' productivity, it was found that employee fulfilment has a huge effect on advancing workers' efficiency. With increased productivity, the company can, in turn, realize higher profits. Happy workers, happy stakeholders.

Increased Sales

Employers may also establish employee discount schemes to increase sales. The discount encourages purchases that would not have occurred otherwise for the company. If a retail store employee wishes to buy holiday gifts for his family, the large discount may persuade him to buy all of his gifts from his employer's store rather than the competition leading to increased sales. A study by the National Retail Federation found that 70% of consumers are more likely to make a purchase if there is a discount offered.

 A study by the Society for Human Resource Management found that 72% of employees would be more likely to recommend their employer to a friend if they received discounts on the company's products or services. This also leads to increased sales and emphasizes that an in-house discount for employees program will benefit the employer by increasing sales.

Related: Walmart Employee Discount: All you need to know

Disadvantages of Discount for Employee Programs

Because of their fundamental nature, several expenditures associated with employee benefits vary. The statement is especially relevant to health insurance benefits. According to the NHE fact sheet under CMS, national health expenditure grew by 2.7% in 2021. Healthcare prices have steadily risen in recent years, reaching an all-time high. That, of course, means that corporations must cut or incur significant additional costs.

There will always be those for whom employment benefits, no matter how generous, are insufficient. According to a 2019 survey by the Society for Human Resource Management (SHRM), 25% of employees are not satisfied with the employee discounts offered by their employer. In such instances, an employee discount ceases to serve its purpose since the employee does not recognize the value of the benefit. They are constantly underpaid and overworked.


Offering a discount for workers program is critical to hiring, motivating, and retaining top employees. Many businesses are turning to services that provide discounts. A study by TeamStage found that 21% of companies offer company discounts.

Cindy Baker
Tiffany Maruva
I am a Strategy and Performance Consultant at Industrial Psychology Consultants. I hold a Bachelor's Degree in Business and Computer Science. Key skills acquired include client management, Canva, HR Analytics, Article Writing, Proposal Writing, and Software Demonstrations. Proficient in using Zoom and Microsoft 365 (Word, Excel, PowerPoint, Outlook, and Teams). I have basic knowledge of Bill Quick and Trello. I aspire to become a project manager one day. I intend to further my education in this direction in order to realize my aspirations in the near future. After a hectic week of emails, I bake during the weekend or make a special meal. Socially, I am an extrovert with a dream to be a global citizen one day.

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