What is a cafeteria system?

"Cafeteria system" is a system whereby an employee of an organisation can choose from various forms of pension or employment conditions, such as leave days, childcare, professional literature, or training courses.

An exchange of existing conditions for a new package often takes place. Usually, a part of the taxed salary is converted into a benefit that is free of payroll taxes, making it more attractive for both the employee and the employer.