US Employee Benefits Benchmarking 2026 | What International Employers Need to Offer to Compete

When you hire your first US employee, you face a question that does not exist at home: what do I actually need to offer?

In the UK, the answer is largely set by statute. Minimum pension contributions, statutory sick pay, 28 days of annual leave: the floor is defined and the employer’s discretion is narrow. In the US, there is no equivalent floor for most benefits. Health insurance, retirement savings, paid leave, dental, vision, life cover: employers make real choices on all of it, and those choices directly determine whether you can attract and retain the people you need in one of the most competitive labour markets in the world.

The cost of getting this wrong has also increased. Employer healthcare costs are rising faster than in any comparable period in the last 15 years. Candidate expectations have shifted. A package that looked competitive three years ago may not be enough today.

This guide gives you verified 2026 benchmarks across every major benefit category, explains what competitive employers offer by sector, and tells you what your US candidates will actually be evaluating when they weigh your offer against alternatives. Every figure here is sourced from a primary study. Nothing is estimated.

Why Benefits Benchmarking Matters More in 2026 Than It Did Two Years Ago

The cost of getting US benefits wrong has increased significantly.

The International Foundation of Employee Benefit Plans projects a 10% increase in employer healthcare costs for 2026, following an 8% increase projected for 2025. Employer health benefit cost per employee is projected to rise 6.5% to 6.7% in 2026, which Hotaling Insurance describes as the steepest increase in 15 years, and that is after planned cost-cutting measures. Without any plan changes, the underlying trend runs closer to 9%.

At the same time, candidate expectations have risen. According to SHRM’s 2025 Employee Benefits Survey, benefits quality is now among the top three factors cited by US employees when evaluating a job offer, ahead of several factors that traditionally dominated that list. A package that looked competitive in 2023 may no longer be adequate in 2026.

According to Bureau of Labor Statistics data for December 2025, benefits cost US employers an average of $13.44 per hour worked, approximately 30% of total compensation. Understanding how that 30% is allocated, and whether your allocation matches what the market expects, is the foundation of a competitive US rewards strategy.

Health Insurance: The Benchmark That Matters Most

What the Market Standard Is

Health insurance is the most significant, most scrutinised, and most expected benefit in the US employment market. Your candidates will ask about it before they ask about anything else.

According to KFF’s 2025 Employer Health Benefits Survey, the authoritative annual benchmark:

• Average annual total premium, single coverage: $9,325
• Average annual total premium, family coverage: $26,993
• Employer share, single coverage: approximately $7,957 per year (84% of premium)
• Employer share, family coverage: approximately $20,143 per year (74% of premium)

What Competitive Employers Offer by Sector

The employer contribution percentage is where you will be most directly compared. The figures below reflect 2025/2026 market norms drawn from KFF employer survey data, Sequoia’s benefits benchmarking, and Foothold America’s experience across UK and European company US expansions:

For international companies with small US headcounts (typically your situation): sourcing health insurance independently gives you poor rates and limited plan choices. Through an Employer of Record or PEO+ arrangement, your employees access group health plans at rates built on a much larger employee pool. This is one of the most tangible financial advantages of the EOR and PEO+ models.

What to Benchmark Against

A package that covers 80% or more of the single premium is considered competitive for most professional roles. Covering 70% or less of single premium puts you at a disadvantage in most markets. Family coverage employer contribution is where smaller companies most commonly fall short. The KFF data shows 28% of workers at small firms are in plans where family coverage employee contribution exceeds $12,000 per year. That is a material financial burden for employees with families.

Plan Type Expectations

As we cover in detail in our guide to US health insurance for international employers, the most common plan type among covered US workers is the PPO (46%) followed by the HDHP (33%). For most professional hiring, offering a PPO as your primary option is the competitive standard. Offering only an HDHP signals cost-shifting to candidates.

401(k) Retirement Plans: The Second-Biggest Benefits Decision

What the Market Standard Is

There is no statutory obligation to offer a 401(k) or to match employee contributions. In practice, professional-level US candidates expect both.

According to Sequoia’s 2025 Benefits Benchmarking data cited by treegarden.io:

• Average total employer 401(k) contribution: 4.4% of eligible compensation
• Most common match formula: 50% match on employee contributions up to 6% of salary (effective 3% employer contribution)
• Second most common: Dollar-for-dollar match up to 3-4% of salary (increasingly common among professional employers)
• Top quartile: Dollar-for-dollar match up to 6% of salary

Vesting schedules matter. Immediate or one-year vesting is increasingly the competitive standard. Three to four year cliff or graded vesting schedules are seen as retention-negative by candidates who have competing offers.

What to Benchmark Against

For a $100,000 US salary, the difference between offering no match and a 3% match is $3,000 per year. Our guide to budgeting for your first US hire shows how 401(k) matching fits into the full employer cost model alongside FICA, health insurance, and other mandatory costs. The difference between 3% and 6% is another $3,000. These are not enormous sums relative to total compensation, but they are highly visible to candidates because 401(k) matching is one of the most commonly compared benefits during a job search.

Through a PEO+ arrangement, your 401(k) plan is set up, administered, and ERISA-compliant from day one without you needing to source a plan administrator or fiduciary trustee independently. Our 401(k) guide for international companies explains the structure in full.

Paid Time Off: Setting the Right Policy

The Market Standard

The US has no federal minimum paid vacation entitlement. This surprises UK and European employers who assume a floor exists. It does not. The Bureau of Labor Statistics tracks what employers actually provide.

According to the BLS National Compensation Survey, private-sector full-time employees receive:

• After 1 year: median 11 paid vacation days
• After 5 years: median 15 paid vacation days
• After 10 years: median 17 paid vacation days
• After 20 years: median 20 paid vacation days

Plus the majority of employers offer 8 to 10 paid federal holidays, though again there is no mandate requiring this.

What Competitive Employers Offer

In practice, professional and technology employers offer more than the median:

• Standard competitive range: 15 to 20 days of PTO per year for professional roles
• Tech sector: 20 days or more, with some offering unlimited PTO
• Unlimited PTO: offered by approximately 7% of employers overall, but 32% of tech employers according to Bnchmrk’s State of PTO 2026 report. Research consistently shows employees on unlimited plans take fewer days on average (approximately 13 days) than those on accrual plans (approximately 15 days).

Foothold America’s own experience: we recommend a minimum of 10 paid vacation days for clients making their first US hire, and our clients average 14 days annually to remain competitive in the US market.

Most US employers now combine vacation, sick, and personal leave into a single PTO bank. State-specific sick leave mandates (California, New York, Massachusetts, and others) set floors that your PTO policy must meet or exceed. A combined PTO bank that exceeds the state sick leave mandate avoids running two separate tracking systems.

What Candidates Will Compare Against

UK candidates joining a US team often expect their UK leave entitlement to translate. It does not, and should not. US employees in equivalent roles typically receive 15 days of PTO where your UK team might receive 25. Setting different policies by country is standard practice and expected. What matters is that your US policy meets or exceeds US market norms, not that it matches your home-country policy.

Dental and Vision Insurance

These are separate from medical coverage in the US and both expected as standard by professional-level candidates.

Dental insurance benchmarks:

• Covers preventive care at 100%, basic restorative at 80%, major restorative at 50%
• Annual benefit maximum typically $1,000 to $2,000
• Typical employer cost: $300 to $600 per employee per year

Vision insurance benchmarks:

• Covers annual eye exam plus contribution toward glasses or contacts
• Typical employer cost: $100 to $200 per employee per year

Not offering dental and vision does not disqualify you from making a hire, but candidates will notice the absence and will mention it. Including both adds approximately $400 to $800 per employee per year and removes a visible gap in your package.

Life Insurance and Disability Insurance

Basic Life Insurance

Employer-funded basic life insurance (typically 1x annual salary) is offered by most professional US employers. Cost is modest: $100 to $300 per employee per year depending on age and coverage level.

Short-Term Disability Insurance

Short-term disability (STD) provides income replacement for employees who cannot work due to illness or injury. It is not federally mandated but is widely offered as a competitive benefit.

Several states, including California, New York, New Jersey, Rhode Island, Hawaii, Massachusetts, and Washington, require short-term disability or paid family leave through state programmes. In those states, the state programme provides the floor and your voluntary STD policy supplements it.

Typical cost: $200 to $600 per employee per year.

Long-Term Disability Insurance

Long-term disability is less commonly employer-funded, often employee-paid with the employer facilitating access to a group rate. Where employers fund it, it is a visible differentiator in senior hire packages.

Parental Leave: The Biggest Gap Between US Law and Market Expectation

What the Law Requires

The Family and Medical Leave Act (FMLA) provides eligible employees with up to 12 weeks of unpaid, job-protected leave per year for qualifying family and medical reasons. It is unpaid. The employer is not required to pay the employee during this leave.

Several states have mandatory paid family leave programmes funded through payroll contributions: California, New York, New Jersey, Massachusetts, Washington, Connecticut, and others. In these states, the state programme pays a portion of the employee’s salary during leave. The employer administers the contributions but does not directly fund the benefit.

What the Market Offers

Despite the absence of a federal mandate, voluntary paid parental leave has become a significant competitive differentiator for professional and technology employers.

According to SHRM’s 2025 Employee Benefits Survey, paid maternity leave is offered by 40% of US employers. Paid paternity leave is offered by 32%. Among technology and professional services employers, the sectors most relevant to international companies making professional US hires, the percentage is significantly higher and the duration is more generous.

Competitive professional employer benchmarks:

For international employers, parental leave is an area where you can exceed US norms relatively easily if your home-country policy is more generous. A UK company offering 26 weeks of enhanced maternity pay can apply a generous policy to its US employees too, and should communicate this explicitly in job postings and offer letters.

FSA and HSA: The Tax-Advantaged Accounts Candidates Expect

Two accounts that do not exist in the same form in the UK often catch international employers off guard when candidates ask about them.

Health Savings Account (HSA)

An HSA (Health Savings Account) is a tax-advantaged savings account paired exclusively with a High-Deductible Health Plan (HDHP). Contributions from the employer and employee are pre-tax, growth is tax-free, and withdrawals for qualified medical expenses are tax-free. The employee owns the account permanently, including after leaving the company.

For 2026, the IRS sets HSA contribution limits at $4,400 for individual coverage and $8,750 for family coverage. An employer HSA contribution is an increasingly common competitive differentiator, particularly in technology. Even a modest employer contribution of $500 to $1,000 per year is valued because it directly offsets the higher out-of-pocket costs of an HDHP.

Flexible Spending Account (FSA)

An FSA (Flexible Spending Account) is a separate tax-advantaged account that can be paired with most plan types, including PPOs. Unlike HSAs, FSAs are use-it-or-lose-it within the plan year (though employers can allow a rollover of up to $660 in 2025). They are employer-administered.

FSAs are widely offered and expected in professional benefit packages. The 2026 FSA contribution limit is $3,300 per year. Employer contributions to FSAs are less common than HSA contributions but do occur.

For international employers, the practical question is usually whether to offer an HSA-eligible HDHP with employer HSA contributions, or a PPO with an FSA option. For a first US hire, a PPO with an FSA option is the simpler and more candidate-friendly starting point.

Mental Health Benefits: The Rising Expectation

Mental health benefits have moved from a differentiator to an expectation in professional employment in the US.

The Mental Health Parity and Addiction Equity Act requires employer health plans to cover mental health and substance use disorder services no more restrictively than medical and surgical benefits. This is a legal minimum that your health plan must already meet.

Beyond the legal minimum, competitive employers in 2026 offer:

• Employee Assistance Programmes (EAPs): Confidential counselling sessions, typically 3 to 8 free sessions per issue, plus referral services. Cost: $12 to $40 per employee per year. Offered by approximately 75% of US employers according to the International Foundation of Employee Benefit Plans.
• Mental health apps and digital platforms: Calm, Headspace, or employer-provided therapy access platforms. Increasingly common, particularly in tech.
• Increased therapy session coverage: Plans that cover a higher number of therapy sessions per year without requiring step therapy or prior authorisation for initial sessions.

For international employers, an EAP is the minimum competitive offering. Cost is low, coverage is real, and employees value knowing it exists even if they do not use it.

What Your US Benefits Package Should Look Like: A Summary Benchmark

Here is a summary benchmark across all categories for a professional hire in 2026. This represents a competitive package for a small to mid-sized international employer making professional US hires.

How Foothold America Helps You Get This Right

Building a competitive US benefits package from scratch is one of the most operationally complex parts of the first US hire for international companies. You need to source and negotiate with health insurance carriers, establish a 401(k) plan with an ERISA-compliant administrator, manage open enrolment annually, handle COBRA compliance when employees leave, and track state-specific mandates across every state where you have employees.

Through Foothold America’s EOR and PEO+ services, your US employees access competitive benefits from day one. Group health plans with rates built on a large employee pool. A 401(k) plan with employer matching. Dental, vision, life, and disability coverage. EAP access. Open enrolment managed on your behalf. COBRA compliance handled. State mandates tracked and applied automatically.

You do not need to build this infrastructure yourself before your first hire. It is already in place.

Our guides to how employer of record works and PEO vs payroll service explain how the two models deliver competitive benefits at small and mid headcounts respectively.

If you want to discuss your specific benefits situation and what a competitive package looks like for your target role and US location, speak to our team. Real people, real US benefits expertise, and a clear picture of what you need to offer to win the hire.