Benefits and Compensation

Four Ways to Tell if Your Perks Will Work

Do your employees and bottom line a favor—think before you dole out those trendy benefits.

Source: bbernard / shutterstock

Companies eager to mimic the success of major high-tech firms like Google, Apple, and Facebook are quickly hopping on their benefits wagon by offering office perks like game rooms, free lunches, and unlimited vacation in the hopes of engaging and retaining top talent.

But lately, some firms are taking a hard look at some unintended consequences of a perk-filled workplace, the messages such benefits send, and whether perks really benefit companies and employees. As a result, some cutting-edge workplaces have rolled them back, or even skipped them entirely.

How can you tell if a perk will be a true benefit? Here are four things to think about in order to make sure your perks will be truly appreciated:

1. What specific things do you hope to gain with the perk?

C-suite leaders and the HR team that supports them need to decide what specific outcome they are seeking before deciding that some other company’s value proposition should be emulated. Will providing perks decrease the time needed to hire IT staff? Will it retain customer call service workers? Will it increase the number of new products launched within 12 months?

Often, the reason for introducing a shiny new perk is only vaguely articulated with statements like “we need to find top talent” or “we are losing too many good people.” But dropping a castle into a fish tank doesn’t guarantee more active or happier fish.

It’s worth noting that, by far, the perks that employees want most are not the trendiest: Health benefits and flexible work arrangements top the list, according to a report in the Harvard Business Review.

2. Do your workers think your perk has a catch?

A large part of the backlash against some trendy perks concerns employees being afraid to use them. Unlimited vacation is a prime example. Conscientious employees don’t want to be seen as slackers, and corporations don’t want to grant excessive time off. So, the easier road for employees is to just not to use the benefit. The same can be said for remote working, flex time, and even on-site fitness facilities—we know of one instance in which exercise equipment ordered for an office went untouched because the local managers thought that using them means that you don’t have enough work to do.

Other disconnects also happen when free lunches, on-site rec centers and mandatory social outings are  ways to anchor workers to the office, rather than to promote work/life balance, especially if employees see these perks as mandatory, not optional.

The solution is for companies to be crystal clear as to why they’ve implemented these policies and to reaffirm that they trust their workers will do the right thing. And if that clarity or trust isn’t there—it’s time to rethink the policy.

3. Ask your workers what perks they really want.

One way that progressive companies decide on the types of perks and compensation they will offer is to survey current staff about the value of existing and hypothetical benefits. We have seen employees value certain perks higher than their true monetary value. For example, workers at one company valued offering free healthy lunch options more than offering free lunches of any kind. Obviously, if an option is less expensive for an employer and valued more by its employees, a path forward is clear.

When employee needs aren’t considered, benefits can backfire. Open office plans are one cautionary tale. Managers who are swayed by sleek open-space design can overlook how work actually gets done. Privacy and quiet can be paramount when dealing with clients, so an open environment could undermine crucial customer relationships, and foster resentment among workers rather than collaboration.

4. Measure the perk’s true costs and benefits.

Improving worker morale and company culture is a great thing, but so is improving a company’s bottom line—and those two goals must be intertwined. Though HR departments may not be used to combining the soft and fuzzy world of company culture with hard concepts like return on investment, both goals must be considered when crafting a benefits policy.

Calculating the true costs and benefits also should anticipate unexpected consequences. Free food and beer might seem like a great way to keep employees at the office, but is that making them more sedentary and unintentionally driving healthcare costs higher? Are employees using those game tables to recharge or to avoid working? Is implementing a perk when turnover is low creating needless expense all in the name of looking like a “cool” company?

One final reason to think before you perk: It may be very difficult to take it back. Large firms like Yahoo and BNY Mellon have suffered backlash and negative publicity when they tried to remove remote working options, and even Google got into in hot water back in 2008 for hiking costs for its daycare program. Be thoughtful and thorough in evaluating the usefulness of a perk before you offer it. Your employees and your bean-counters will thank you.

Paul Mastrangelo is Principal Strategist for CultureIQ, a 50-year-old startup company (legacy CEB, Genesee Survey Services). With 25+ years’ experience in organization development, HR research, and adult education, Mastrangelo has delivered executive presentations in 13 countries, in 25+ professional publications, and coauthored with Ingwer Borg Employee Surveys in Management.