Do employee perks actually work or is it all a fad?
Google have always been innovators. I don' think that can be argued, can it? Be it search engine technologies, mapping services, digital assistants or self-driving cars, for the last 20 or so years, they have led the way. They were also the innovators of the modern workplace leading the way on the 21st-century focus on workplace "˜perks'.
A quick Google (innovating the English-language too!), returns page upon page of praise for the benefit of employee perks, with one website even declaring:
"œEmployee perks are one of the most important practices a company can implement."
But little in life is ever so one-sided. So, what is the real impact of employee benefits in the workplace? Do employee perks work as well as we're led to believe by the suppliers and evangelicals out there?
What are workplace perks?
If you work in a large office, travel to client locations or work for almost any US-based multinational, the chances are over the last few years you've seen your far share of ping-pong tables, "˜Friday lunchtime drinks' invites, and futuristic looking coffee machines in the "˜employee refresh lounge'.
According to research conducted by recruitment site Totaljobs one in three UK employers are significantly investing in employee-focussed workplace improvements. These range from the practical such as showers and gyms to the slightly leftfield examples of office pubs, weekly ice-cream deliveries and even "˜fur-ternity' leave.
Many UK companies are now implementing workplace perk programmes, with some truly eye-catching examples:
- Brighton-based marketing agency, Propellernet put 5% of all profit into a "˜Fun and Wellbeing Fund'. Employees write down what they would use the fund for, encouraged to dream big with their options placed into a spherical receptacle and added to an old gumball machine. Then once a month, one ball is drawn, and that individual gets to see their dream become reality.
- Digital marketing agency Nina Hale, offers new parents a week's leave to look after their new arrival. Less than statutory I hear you cry? Fear not, for this perk relates to their pets! They call it "˜Paw-rental' leave"¦
- Airbnb employees are given almost Â£2000 worth of travel credits per year and actively encouraged to head out into the world and try out any Airbnb property that takes their fancy.
- Netflix, Virgin and Pinterest employees all enjoy the benefits of unlimited holiday allowances. Sounds crazy? Well, scores of companies have found giving their employees the freedom to holiday whenever and as much as they desire, can have huge boosts for productivity. As long as the work gets done, these progressive businesses are too fussed on the details around "˜when'.
Perks are designed primarily to tackle two key areas of business:
- Talent acquisition
- Employee retention
But there is often confusion around exactly what staff perks are and how they (and even if they do) differ from employee benefits. In order to answer the question 'do employee perks work' we need to understand how these terms differ.
The differences between perks and benefits?
The terms "˜employee benefits' and "˜employee perks' are often used interchangeably, but there are some key differences to be aware of.
Benefits traditionally refer to a set of non-wage, compensational awards, often legally protected, tied to an employee's contract. These can include the likes of:
- Holiday entitlement
- Paid maternity/paternity leave
- Pension contributions
- Stock options
Perks are the added extras that aren't generally monetary-based, rarely listed in your contract and pretty much never a legal requirement. They are designed to offer a little extra incentive, motivation or all-round feel-good factor in the workplace. Often perks make up a large chunk of a company's employee engagement
programme. Some "˜classic' examples of perks include:
- Table tennis facilities (ranked by one report as the most desired perk in the UK)
- Video game consoles
- In-office snacks
- Away days
- Company cars
- After-work/lunchtime drinks
It's important to remember this distinction, particularly when those selling employee perks utilise statistics such as (found on one of the better-known perk-focussed brands):
"œ85% of employees are more likely to work for employers who offer clearly labelled benefits"
Do employee perks work or are they the emperor's new(ish) clothes?
Now to the crux of the matter; are perks effective in improving acquisition, retention or any other area of your business?
Short answer, yes. Longer answer, yes but"¦only to an extent in most cases. Putting that answer into the context of those two key aims from before helps with clarity:
- Talent acquisition
This is where, in our opinion, perks really shine.
With an over-bloated job market in many industries, increasing numbers of graduates entering the workforce and digital platforms such as LinkedIn, Monster and Totaljobs making job hunting easier than ever, perks can help your company stand out.
Research shows that particularly amongst millennial workers, perks can be a real boon to a company's offering, with many ranking perks as more important than base salary in their decision-making process.
- Staff retention
With a key specialism of Weekly10 being that of employee engagement (where a good performance has been proven to reduce staff turnover), we hear a lot from the potential
9clients we meet a version of the line "œoh, we've got employee engagement sorted, as we use perks". Yet research has shown that perks aren't always that effective at keeping employees from looking for new opportunities.
The problem is, that many perks only offer-up superficial benefits or external reward. Focussing on perks that make life simpler or add a stronger sense of purpose, pride or attachment to a company is the key to an effective perk programme that will keep your best people in post.
For example, free doughnuts on a Tuesday are, obviously, a lovely touch. But come Friday when the IT system crashes just as your customer service manager is trying to resolve an issue for an irate customer, is that doughnut going to stave off thoughts of "œthis is more trouble than it's worth"?
The best perks offer up tangible benefits to how an employee lives their lives, particularly away from work. They focus on health, wellbeing, happiness, socialisation and their futures.
Flexibility is also a key contributing factor to the success of any perk-based scheme. Research has shown that there are clear generational differences in the perks our staff would like to have. If you can offer up a perks package that allows a level of choice, you're more likely to find perk effectiveness is boosted. However, the same research shows a clear pattern of flexible and remote working opportunities are high on everybody's wish list.
So, do employee perks work? Yes, they certainly can, but like most things in life, they come with plenty of caveats!
What are the best perks for staff retention?
Here's our list of the best perks an employer can offer to impact staff retention:
- Flexible working hours
- The opportunity to work remotely
- Gym memberships or facilities
- Wellness programmes
- Staff equity schemes ("˜skin in the game' is a superb motivator)
- Extended maternal/paternal leave
- Additional leave allowance for big life events such as moving to a new house or getting married
- Training and growth schemes
- Free meals
So, there we have it, our whistle-stop tour of the world of perks. We'd love to know how your company approaches perks, if at all, so be sure to follow us on Twitter or LinkedIn so we can continue the conversation.