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It Pays to Reward Staff

Published: December 14, 2011 Full Article

By Geoff Williams

You may not be able to offer your employees six-figure salaries, but you can make them feel like a million bucks. Employee perks, once a staple of the American corporate life, started to become something of an endangered practice during the Great Recession, but now that the economy appears to be rebounding, they’re gradually coming back.

The global outplacement consultancy Challenger, Gray & Christmas, Inc., based in Chicago, conducted a survey last May showing that 18% of companies have restored their pre-recession perks and 25% have introduced new perks. Why? Well, in the same survey, 49% of business owners indicated they worry about other companies luring away their best workers. That may explain why some businesses are becoming innovative with perks, offering more than paid vacations and the ability to telecommute from home.

“I tend to have a younger workforce, and they’re not always motivated by money,” Patty Briguglio observes. “They’re motivated by a culture that appreciates and values them.”

Briguglio is the president of MMI Public Relations, based out of Cary, North Carolina. She works tirelessly – and isn’t afraid to spend a bit of money—to create a comfortable, creative work environment for her employees. Free bagels every Wednesday may not set her company back much, but the free hair care services MMI offers employees are a bit more lavish. Whenever a staff member wants a trim, a perm or just a regular cut, they can charge up to $100 of the cost to Briguglio’s company.

Surely there is a limit. You’re probably thinking this is offered once or twice a year.

“I don’t really regulate it. They go when they need to go,”Briguglio responds. “I get my hair done every six weeks.”

This isn’t a case of Briguglio employing four or five people. She has 23 employees.

Her firm, which keeps its revenues private and was founded in 1994, also budgets for another perk: Broadway musicals. Whenever one plays at the North Carolina Theatre in nearby Raleigh—there were four big ones in the 2011 season—Briguglio, her staff, and any significant others or spouses who are interested attend.


It may sound like a lot of money, but employee perks can pay off in big ways for the boss. Jeff Langenderfer, associate professor of business at Meredith College in Raleigh, says, “Since dissatisfaction is highly related to turnover, an employee perk program could pay for itself in reduced turnover costs, like training, recruiting and startup performance lags. Of course, that depends on the costs of the perk program and the turnover costs for a particular industry or firm.”

“Perks are always a good idea,” echoes Sara Robicheaux, dean of business programs at Birmingham-Southern College in Alabama. “Especially now, it can be a way to keep employees happy at work with something other than a salary increase or large bonus. Simple things like extra vacation days, retirement savings perks, free drinks and healthy snacks, discounts on gym memberships,or other community things like zoo memberships can go a long way in creating employee loyalty.”

But salary increases are nice perks, too. Earlier this year, at the start of the fall, Dan Schneider, CEO of SIB Development and Consulting in Charleston, South Carolina, came up with a novel perk to reward company loyalty. He announced that anyone still working for him in five years would receive an extra $50,000—on top of the usual raises and holidays bonuses.

“I don’t know if it was because I was on cold medication and decided to be nice, but whenever I talked to people who were looking for a job [change], they were always wanting to make a bit more, like $10,000 more per year,” Schneider explains. “They’re never trying to double or triple their income. It’s always $5,000 or $10,000 more.”

So Schneider decided he would give his employees $10,000 more a year, but hold it for five years as a carrot,and while he hasn’t made it official, he hopes the $50,000 prize, or something similar, can be a perk he offers his employees every five years.

Why not just give his employees an extra $10,000 every year? It wouldn’t be as significant, says Schneider. Plus, he reasons that it’s a windfall that might do his employees more good.

“You give someone $10,000 extra every year, and they’ll just adjust their lifestyle and spend it,” Schneider says. “With $50,000 at once, they’re more likely to be fiscally responsible and put it away, use it on a down payment for a house, or pay for a wedding or a kid’s college education.”

But for those employers who are considering offering exciting perks to their employees, Robicheaux cautions, “It’s great to give perks, but once given, they better not be taken away, or the morale in the office will suffer.” And for those who do give them, employers will likely find their own morale going up.

“I love to be able to give [perks] to them,” Briguglio says, adding that when new employees learn of them,their faces light up. “It’s really cool. You get to be Santa Claus. Who doesn’t want to be Santa Claus?”