Nourish Your Employees With a Food Allowance or Food Stipend

Cassy Aite
April 3, 2024
Nourish Your Employees With a Food Allowance or Food Stipend

Attracting top talent for your business is always a challenge. Superior candidates look for competitive salaries, great perks, an inspiring company culture, and a valuable employee experience.

But attracting employees isn’t the only challenge. Employee retention is just as integral to business success. Without the right mix of upward mobility, professional development, and benefits, employees aren’t scared to look elsewhere. According to a CNBC study, an eye-popping 96% of employees actively sought new jobs in 2023, putting pressure on employers to provide a holistic and rewarding employee experience.

While healthcare and retirement plans have long been standard benefits, health and wellness have started to gain just as much traction. Mental health solutions, gym memberships, and childcare are all popular perks. Still, some employers are turning to food allowances — or food stipends — to level the playing field against fierce hiring competition.

Don’t let your employees go hungry — or worse — hangry. Learn more about the benefits of food allowances, how they work, and what you need to do to implement one at your business.

What Is an Employee Food Allowance or Food Stipend?

An employee food allowance — also known as a food stipend, meal benefit, or meal allowance — is a set amount of money an employer gives to an employee for food. It’s a fringe benefit or extra perk, similar to an education stipend or per diem that provides monetary assistance to employees simply for being an employee.

Employers may offer a food stipend for any allowable food-based expense, including grocery allowances, lunches, or food delivery services (for remote workers). It’s entirely up to you.

How Often Do Employers Provide Food Stipends?

As an employer, you have full range to choose the monetary amount of the food allowance and the benefit frequency. Employers typically offer food benefits monthly, but daily, weekly, quarterly, or yearly food stipends are also acceptable.

5 Reasons To Offer a Food Allowance or Food Stipend

Employees smiling and eating at the office

Like other types of perks, benefits, and stipends, food allowances provide advantages to the employee. But a savvy employer also realizes that food stipends can benefit them too. Consider some of these advantages if you’re unsure whether to start a food allowance program.

1. Boost to Productivity

A happy employee is a productive employee — 13% more productive, according to an Oxford University study. And, per researchers, eating healthy makes you happy. As such, a well-fed employee through your food allowance program should get more work done and feel more valued as a part of the team.

2. Show Employees You Care About Their Well-Being

Food stipends and other perks increase your ability to attract and retain top employees. However, perks alone don’t guarantee that your employees will stay put. You need to show how much you care.

Beyond employee recognition rewards and programs, taking a vested interest in the well-being of your employees bodes well for retention. A food allowance demonstrates your commitment to their health, and an all-inclusive menu ensures that older adult employees, those with dietary restrictions or certain dietary needs (vegan, gluten-free, etc.), and team members with chronic conditions or health conditions can choose foods that appeal to them.

3. Travel-Related Perks

If you have employees who travel frequently, you usually provide a per diem that pays for lodging, meals, incidentals, and other business-related or travel expenses. However, your company — or worse — your employee could face tax implications if you provide a per diem amount over the government-allotted standard rate (although this varies by state).

As such, a food allowance can skirt the taxable benefit the IRS levies if you exceed the maximum per diem rates. This can help you pay for the cost of meals without meal expenses and incidental expenses — otherwise known as M&IE — which can cause increased taxes.

4. Remote Employee Retention

Since COVID, most workers want to perform their duties in the home office. With global reach, the ability to attract remote workers becomes more difficult with every passing day. Yet most remote workers fend for themselves with regard to meals.

Offering a food allowance for remote workers ensures they’re adequately fed throughout the workday without taking a break to prepare a meal. You can even include lunch meetings or Lunch Roulette to boost employee engagement and morale.

5. Lessen Financial Strain

The U.S. Government Accountability Office states that around 9 million working Americans receive benefits from the Supplemental Nutrition Assistance Program, or SNAP benefits, often called a food assistance program. Though eligibility requirements only fall to low-income individuals and families, food assistance isn’t easy to discuss.

Furthermore, the rising costs of food coupled with inflation can take a heavy financial toll on employees — even those who sit in silence.

But with a food allowance, you can actively reduce your employees' bills while giving them the nourishment they need, regardless of whether they’re on government assistance.

3 Considerations When Starting a Food Allowance Program

Overhead view of healthy foods, nuts, and vegetables

Choosing an insurance company for healthcare benefits and deciding what it offers — from Medicare Advantage plans to flex cards to over-the-counter drug discounts to ease of enrollment — is an integral part of your healthcare perk. But food allowance and food stipend programs require the same consideration.

When you set up your food allowance program, ensure that you cover these topics to provide the best program possible.

1. Budget

Don’t overpromise and underdeliver on your food stipend program. When you start a food stipend program, figure out how much you can reasonably spend on top of other business expenses, the types of food you want to offer, and the cost involved. You don’t have to wow employees with hundreds of dollars monthly in food perks or daily meals. Your employees will appreciate a small food allowance as part of your benefits package — all while being cost-effective for your business.

2. Scalability

If you’re in the midst of expansion or hiring, scalability considerations ensure you don’t exceed your budget. When you need more employees soon, remember to plan accordingly. You may also want to contemplate the easier ways to distribute your food allowances, whether through accounting software or by purchasing bulk gift cards for food.

3. Frequency

The intended use of your food allowance program will almost certainly dictate the frequency of the payments. If you want your employees to use the food stipend to buy snacks or coffee, a daily or weekly allowance prevails. But if you’re offering a food allowance program for groceries, a monthly or yearly plan is the better choice.

How To Start a Food Allowance or Food Stipend Program at Your Business

Once you’ve chosen your food stipend program's budget, frequency, and scalability considerations, now is the time to implement the program. Follow these steps to properly begin the program with minimal setbacks or hindrances.

  1. Use a software program or benefits administrator to disburse funds in the correct amount and frequency.
  2. Decide on a date to start the program. Depending on the frequency of the payments, you can make the start date on the first of the month, every Monday, etc.
  3. Create a document that outlines the meal allowance policy in simple terms. Bulleted lists are easy for employees to read and should give them program highlights. Include this in your employee handbook so it’s easily accessible.
  4. Tell your employees! Your staff will be excited to learn about the new program while they think about the mouthwatering possibilities.

What Can Employees Spend Their Food Allowance On?

As mentioned, the employer selects what foods and vendors employees can choose. Some of the most common inclusions in food allowance programs include:

  • Healthy food, especially healthy snacks
  • Grocery store allowances
  • Coffee, tea, smoothies, and other beverages
  • Supplements
  • Meal delivery or takeout
  • Onsite meals, including breakfast, lunch, and dinner

You don’t have to include all these allowances for your meal stipend, but employees will feel more appreciated with a wider range of options — just as they would with a yearly employee gift.

Other Allowances, Stipends, and Perks To Consider

Employees exercising in the office

Along with your food stipend program, you should also offer other perks to offset the living costs of your employees. Doing so improves employee engagement, morale, and retention. Some employee benefits beyond a food stipend might include:

  • Healthcare for current or retired employees so they don’t have to pay for Medicaid, original Medicare, or Special Needs Plans (SNPs)
  • Free parking or a commuting stipend
  • Regular gifts for work anniversaries or milestones
  • Virtual gift cards
  • Flexible work hours
  • Unlimited PTO
  • Extended maternal and parental leave
  • Pet-friendly workspaces
  • Childcare assistance
  • Home office stipends for remote workers
  • Health and wellness allowances, such as a membership to a gym or yoga studio

Virtual Gift Cards: Food Allowances and Food Stipends Made Easy

One of the most difficult parts of offering a food allowance or stipend is that you must account for every meal. Each snack, dinner, or coffee requires a receipt to ensure the meal falls under your monthly stipend regulations, depending on how you structure the program or if you require reimbursements or expense reports.

Fortunately, you have a quick, easy, and convenient fix: bulk virtual gift cards from Hoppier. When you work with Hoppier, you can choose the meal providers, set the amount on the gift card, select an expiration, and send it at your desired frequency. Everything’s taken care of in one fell swoop — no receipts nor extra accounting. As a bonus, any amount left on the gift card after the expiration goes right back into your bank account.

Discover how Hoppier can streamline your food allowance program today. Maybe there is such a thing as a free lunch.

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Ready to 2x your global engagement at your next event, with Ox stress?

Make Hoppier your unfair advantage today, schedule a demo

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Ready to 2x your global engagement at your next event, with Ox stress?

Make Hoppier your unfair advantage today, schedule a demo


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