Successful ‘perks’ are often free

Nov 7 2008 by Nicholas Craig, The Journal

THE £2bn set aside by one bank for “staff costs” including bonuses while being bailed out with £20bn of taxpayers’ money beggars belief.

Its chief executive says that performance has to be rewarded. Most of us would agree with that, but then apply it to real world economics rather than an avaricious wish list.

I am a firm believer in rewarding staff, particularly the more junior levels, who tend to remember the reward longer, and can replicate it as they rise through the ranks, hopefully more motivated, enthusiastic and committed because of timely recognition by an employer.

Bonuses are now beginning to come in ever more creative guises as companies realise the sense of investing in employees. The more puritanical atmosphere sweeping through boardrooms at the moment is generating some interesting ideas which will hardly show on the balance sheet.

The latest perks include working from home, free house cleaning services, pamper days, concierge services to pick up your groceries or dry cleaning, the opportunity to bring children or pets to work, family and pet health insurance and even gardening help.

More creative perks suit smaller businesses that can’t afford the mega-buck bonuses of the largest organisations. The more successful benefits are not necessarily the most costly and in some cases they are even free. One company’s employees can set their own hours from the day they are hired.

A growing number of firms provide games rooms, and some dot.com organisations buy games and toys for the office. In hard working schedules a bit of fun is not only enjoyable but eminently good sense.

For the really budget conscious boss even free coffee and tea makes a difference to staff. The real value is in the recognition perks give to employees who can all too easily feel overlooked and under-recognised.

A basic package may entice someone to work for a particular company but it is the day-to-day relationships with colleagues and the approach of employers that converts them from a nine-to-fiver to an ambassador for the business.

The hugely inflated bonuses of city bankers can lead to reckless behaviour and appalling consequences. A more realistic approach to perks focuses on the best ways to ensure talented staff enjoy their time at work and contribute to its success. In that way loyalty is rewarded and good staff retained during the best and the worst of times.

Nicholas Craig is a partner at Watson Burton law firm