MediaCom dropped two places to 30 in the report after a year of record entries.
The WPP-owned agency's 439 members of staff are rewarded with profit-related pay and free private healthcare. There are also workshops to teach staff about the importance of finding a balance between work and their personal lives.
Karen Blackett, the head of marketing and new business, said the agency's team ethic had "shone through".
She added: "Other media agencies have not caught up with the fact that the way to retain and win new business is to invest in staff; having happy staff pays dividends."
Carat, which dropped from 51 to 85, was well-liked by its staff for having a generous social events budget and quality training.
The Aegis-owned agency also offers employees 20 weeks' maternity leave for new parents, and was commended by staff for having supportive management.
Neil Jones, the Carat managing director, said: "We are proud to be in the survey and equally delighted to be one of only a handful of agencies to appear in the Top 100 for five years in a row."
In previous years, MindShare, DDB London, JWT and Abbott Mead Vickers BBDO have appeared in the table. In 2005, TBWA\ London came in 50th place, but it has dropped out of this year's report.
However, the ad agencies St Luke's and glue London both appeared in The Sunday Times 100 Best Small Companies to Work For list, coming in at third and 48th respectively. The table was launched in 2004, for enterprises employing between 50 and 249 staff.
In the same table, the digital agency i-level came 39th and the media planning and buying agency PHD was in 79th place.
Phil Teer, the St Luke's joint managing director, said: "We are very proud. It is one thing to create a good working environment when the industry is booming and agencies are rolling around in jacuzzis of cash. It is something else to do so under today's tough market conditions."