Page 105 - Retaining Top Employees

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Compensation: Why It (Almost) Doesn’t Matter 93

employee views as part of
Don’t Take
his or her base pay. This
Benefits Lightly
mix is usually the result of It’s amazing how often
market practices, the orga- employers miss the fact that employ-
nizational culture, and tradi- ees view benefits as an element of
tion. As a result, the same their base pay.When times are tight,
considerations apply to employers often put employee bene-
fits high on the list of costs to be
these benefits as to base
cut—and are often stunned at the
pay: they are satisfiers, so
vehemence of the employee
the employee will be upset
response.This is usually because the
if you don’t provide them or employer has failed to make the dis-
you reduce them, but they tinction between benefits and perks.
contribute little to retention.
Perks
Perks (perquisites) are non-cash rewards that are not deemed to
be part of base pay. Perks can be recurring—such as fitness clubs,
on-site child care, subscriptions, and memberships of various
sorts—or nonrecurring—such as computer equipment for personal
use, tickets for sporting or entertainment events, and even free
massages.
Perks are to benefits what bonuses are to incentives: they’re
much more effective than benefits for retention. Employees
expect benefits; they appre-
ciate perks. So (as with Keep Perks as Perks
bonuses), do everything A perk given once is a
you can to maximize the perk.A perk given twice is
a benefit.A perk given a third time is
retention effect of perks.
a right! Perks,which should be seen
They must meet the “four
as above and beyond what might be
pillar” test: expected in the compensation pack-
• They must be used age,have a tendency to congeal into
benefits—something employees view
for public recogni-
as a part of their base pay. Use the
tion. (One CEO I
tips at the end of this chapter to
know lets the make sure your perks retain their
“employee of the “perk status” and don’t end up
month” use her becoming benefits.