Perks Up: Companies — and Employees — Grapple With the Potential Loss
More than a century ago, employees of Sears, Roebuck, and Co. stumbled upon a new type of perk: employer-sponsored life insurance. Then, during World War II, companies tacked on a different hiring incentive: health insurance. These days, you’ll find on-site complimentary meals and free cab rides to sweeten the employee experience.
As workplaces have evolved over the past few decades, companies have tried to woo and retain talent with an ever-expanding myriad of perks. Never paying for lunch? No problem. Pet insurance? Sign me up. And as the workforce stretched to include an age range spanning multiple decades, those add-ons became more complex to navigate.
But now, faced with economic uncertainty, some of those extras could go away as many cash-conscious companies grapple with what perks to retire. As they do so, employees are sending a strong message: Don’t underestimate the power of perks. Indeed, 76% of all employees name compensation beyond salary as a deciding factor in accepting and keeping positions.
That’s why it’s incumbent for savvy leaders to proceed with caution when deciding what perks to potentially eliminate. In many cases, retracting seemingly fluffy add-ons could threaten employee motivation. Here are some guiding principles in offering — and augmenting — perks.
Consider how perks impact company culture
While a bottom-line assessment of perk pricing might be one method for determining what to eliminate, leaders can pair that knowledge with understanding how different perks affect employee experience. When considering perk reductions, prioritize those that have the least impact or potentially don’t foster inclusivity.
To do this, it’s critical to run ongoing evaluations. As demographics in workplaces become less homogenized, so too do the needs and motivations of staff. Thoughtful consideration of perks requires leaders to recognize how they fundamentally enhance an organization’s culture. For example, if you want to promote inclusion, tuition reimbursement, floating holidays, and mentorship/sponsorship programs will go much further than pinball machines in the lobby.
Give employees a choice
Research shows that, above all, flexibility reigns as the supreme perk across generations. And yet, in many companies, remote work and personalized schedules that have become the norm are, once again, up for discussion.
Employers who listen to such requests and cater to the needs of a multigenerational staff can find themselves ahead of the pack. One of the best ways to do this is to engage employees in the perks decision-making process by offering them choices of what stays and what goes to ensure offerings aren’t over-indexed for, say, people with families versus those who are single to provide fairness.
Communicate, communicate, communicate
If your organization needs to discontinue some perks, communicate what’s happening and why clearly. It’s important to acknowledge how such changes could affect motivation because losing something can induce a sense of threat in our brains.
Employees want to feel their employer values their well-being, and leaders can assuage such threats by tapping into employees’ experiences of relatedness and fairness when they communicate well. Ensure you’re offering multiple channels of communication and giving employees a chance to speak up and express their views.
As perk discussions percolate, leaders can find solace in knowing that across generations, many workers’ top expectations still center on basics such as salary and mission. In designing perks and communications about those perks, bear in mind that most employees will value meaningful work with reasonable compensation over a beanbag chair and on-site barista.
Author: Kathryn Kruse