With just 32 percent of employees at U.S. companies feeling engaged, according to a 2016 Gallup report on a survey of 80,844 workers—and some unemployment measures at historic lows—businesses are looking for ways to build employee engagement, improve retention and differentiate themselves from other employers. One way businesses can do that is by using perks to recognize good performance and encourage teamwork.
While the idea may summon images of luxurious on-site gyms, free cafeterias offering gourmet meals and other emblems of high-flyers like Apple and Google, experts say inexpensive perks can do the job without straining smaller businesses' budgets.
"Absolutely, benefits and perks don't need to be high cost," says Evren Esen, director of workforce analytics for the Society for Human Resource Management in Alexandria, Virginia. "Many perks can easily be incorporated into regular business operations and budgets."
Some desirable perks, such as allowing workers to telecommute, cost little or nothing. In these cases, Esen says, "the major obstacle seems to be corporate culture rather than cost."
Picking the Right Perks
Close behind telecommuting as a desirable low-cost perk comes flexible scheduling.
"Flexible scheduling is one of the number one things our employees want to have in the workplace," says Danny Nelms, president of Work Institute, a Nashville, Tennessee, company that does research and consulting on retention and engagement.
Meals—including breakfasts for team building and company-sponsored dinners to reward employees for working late—are low-cost perks suggested by Nadia Eran, talent management consultant for New York City-based employee retention consulting firm Retensa.
One of Eran's favorites was a company-sponsored chocolate tasting organized by a chocolate-loving associate. "It was just the cost of the piece of chocolate, and we got to learn about one of our team members," she says.
—Evren Esen, director of workforce analytics, Society for Human Resource Management
Education-oriented perks such as free magazines that relate to an employee's line of business, or reimbursement for professional or personal development classes also get the nod from Eran. So do wellness perks like gym memberships.
"Those are things that are going to have a high return on investment," Eran says.
Eran also says firms can get good mileage out of granting employees unlimited unpaid vacation time. She isn't as favorable about unlimited paid vacation, and suggests firms encourage vacationing employees to ensure that work they would be responsible for will be completed in their absence.
Other low-cost perks that can help employees feel management cares include being pet-friendly and having a casual dress code. Esen says changes like giving employees more autonomy and involving them in decisions that don't come with price tags, can be among the most appealing perks.
Before offering any perk, experts suggest developing objectives for the program along with a strategy and budget.
"Have a candid conversation with leadership about what they're willing to spend," Eran says.
Next, survey employees or use focus groups to find out what your employees want. Bob Nelson, a San Diego, California-based motivational consultant and author of 1501 Ways to Reward Employees, warns against getting into a "perks race" by trying to match what other companies are offering. Instead, he says, tailor a perk program to match specific organizational goals such as improved collaboration as well as the wants and needs of this particular workforce.
"As you can make perks more personal and align them with some type of company value or goal or to use the occasion to remind everyone of the challenges or progress the company is making, they will have more meaning and significance to everyone involved," he says.
One recommended tactic is to use low-cost perks to recognize and reward performance. Eran says each quarter her company selects the employee who has shown the best attitude or completed the most stretch projects and gives him or her a choice of gift cards from well-known retailers. Costs are negligible because the program uses reward points from corporate credit cards to acquire the gift cards.
Perks That May Not Work
It can be a mistake to offer perks without first having a goal and budget in mind or without asking employees what they want. For instance, Eran says an on-premise gym can work against a corporate goal of encouraging work-life balance.
"Keeping them at the office longer isn't what you want to do," she says.
Anything, costly or not, that hasn't been suggested by employees probably shouldn't be a first choice.
"If you just start giving out movie tickets to every employee once a month, the question is how many of those tickets were never used," Nelms says.
And perks alone are probably not enough to turn around a disengaged workforce.
"Perks are never going to work when leadership is not trusted, when employees are not inspired," Eran says. "That's when low-cost perks are going to have little impact."
However, if a business has a goal and asks employees which perks to offer, low-cost perks can be part of encouraging a more-engaged workforce.
"Every employee will appreciate that you asked them what they wanted and you gave it to them," Eran says.
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