Job perks get a makeover

By VICKI BLAND

Scored any job perks lately? Perks - the proper word is perquisites - have long been used by companies as a strategic way to attract and retain talented staff. But today's perks look a little different from those of even 10 years ago.

Today, company cars, cellphones and superannuation schemes are out and "duvet days", flexi-hours and paid sabbaticals are in. Work-life balance incentives and treating people like part of a team are typical.

IT specialist Zeacom lets staff wear slippers to work, fit in a 7.5-hour working day any time over a 12-hour period, and provide free fruit and regular blood pressure checks.

International public relations firm Text100 allocates duvet-days, where staff can hibernate two days a year without excuse and offer annual and maternity leave beyond statutory requirements. Both companies offer health insurance, share options and performance incentives as more financially tangible perks of the job.

International observations of modern market perks include employers donating to charities their employees support, paying for personal counselling for divorce or ill health, and providing low-interest finance for employees to buy leisure items, such as motorbikes and jetskis.

Steven Murphy, human resources director for Text100 Asia Pacific, says the war for talent means modern organisations are getting creative with their perks.

"Our duvet-day perk generates a surprising amount of interest, but works really well for us. Everyone has days when they don't want to come to work. Rather than have our staff phone in a false sickie we prefer to treat them like adults."

Text100 also offers five weeks' annual leave after the first year of employment and, partly because of the high number of women in its public relations workforce, flexible hours and work from home options.

But it's the firm's unusual sabbatical perk which best grabs the imagination of potential employees. After six years of satisfactory performance, Text100 staff are entitled to three months' leave on full pay.

Murphy says that perk is worth every cent it costs. "After five years, people start to consider their next employer and after six they really need a mental break.

"The perk pays us back in staff retention and talent attraction and people come back really pumped up."

He says traditional perks are also important. "In some markets, employees get a better tax rate if they sacrifice salary for things such as company cars. So we do the maths and look at it for them. The goal should be to maximise the disposable income of the individual."

Dennis O'Callaghan, managing director of remuneration consultants Strategic Pay, agrees this approach is attractive to employees but says it doesn't always work for employers.

"Since the tax reforms of the early 80s and the introduction of fringe benefit tax, employers have increasingly dropped compulsory employee benefits, such as cars and superannuation schemes in favour of fixed salaries and incentive pay.

"However, there has been a bit of a reappraisal in the past five years. While company cars are still avoided, some companies are returning to superannuation."

O'Callaghan says organisations offering health insurance are beginning to cap subsidies because of rising premiums. That raises the important question of which perks cost employers more than they are worth in staff retention and attraction benefits.

Murphy says while health insurance should form the baseline of any job offer, company cars and housing allowances are risk areas.

"Both are a concern for companies employing managers who are redeployed or move on sooner than expected. The company loses money on the lease or has to sell a car at depreciated value."

So how do small businesses provide the perks employees want? And do New Zealand employees expect too much from what is essentially a small business economy?

O'Callaghan says some male employees get carried away with what they think they're entitled to. But he says targeted individual perks tend to settle them down.

Murphy says most employees are reasonable about the corporate perks they expect. And the extent to which an employee is permitted to drain company resources through little perks like internet access or "borrowing" stationery depends on the relationship between employer and employee.

"You will always get someone who will push a little too far. But our approach is as long as our people are not spending hours online or trawling porn sites, then using the internet for a few minutes of personal email or banking is okay. And we would rather have someone help themselves to the odd envelope than take 35 minutes to get to the post office."

Jo Marmont, human resources manager for Zeacom, says its employees are more interested in non-remunerated perks. "Employees may prefer to have their contribution recognised in some other way than salary. For example, the company may agree to pay tertiary fees and provide paid study leave."

She says Zeacom perks include six-monthly HeartSmart assessments, life and health insurance, training contributions, wearing slippers at work, flexible work hours, free fresh fruit and team dinners, and share options.

O'Callahgan says while shares can be "extremely lucrative", employee views on their value have changed in recent years.

"US research shows senior executives will walk away from millions of dollars in share options. The cliche that share options turn every employee into an owner is not accepted any more - it is simply another form of reward."

Text100's Murphy agrees that people are more cynical about share options than they used to be.

"It doesn't sell people as it did before. But because share prices are now so low there is value in it and it will become more important."