Employers beware! The headhunters are watching, waiting like ravenous vultures to swoop down and abscond with your employees so they can collect a fat, juicy commission check for placing them elsewhere. If you think it could never happen to you, think again. No one is immune. In todayÕs tight labor market, employees are in the driverÕs seat. For employers, the challenge becomes one of not only attracting competent, motivated employees, but retaining them. This has led company after company into rethinking current strategies and policies regarding culture, compensation, benefits and incentive packages.
Jodi Littlestone knows firsthand that the headhunters are out there pounding the pavement for prospective employees. Truth be known, the Director of HR for Internet based consulting company iXL has had several opportunities to leave her current position. "I've had lots of calls from headhunters offering more money than I'm currently earning," Littlestone comments, "but I have no desire to leave."
While she admits the company's benefits and incentives package was inadequate when she came aboard, Littlestone takes great pride in the current program which continues to evolve to meet changing workplace and employee needs. "There are certain basics people expect," she notes, "like medical, dental, 401(k), and to some degree, disability coverage. If you don't have that, you've certainly got a gaping hole." It's the extras, however, that employees respond to, and the extras to which iXL pays attention. Littlestone appreciates that iXL looks at employees as a whole being. "We recognize that employees have a life outside of work. More importantly, though, we recognize that what goes on in their lives impacts their work here. Which is why we started the process of revitalizing our program by asking ourselves ‘what matters to our employees.'"
Like many of its high tech peers, much of iXL's workforce consists of younger professionals primed for future parenthood. "We discovered that maternity matters to our employees," Littlestone responds. Taking that fact into consideration, the company initiated its $65 Baby policy. Although hospital costs are billed separately, mothers-to-be pay only $65 for an entire pregnancy worth of physician visits.
Employee Assistance Programs are another facet of the company's ever evolving employee offerings. "Imagine if you're a parent and your teen has a drug problem," Littlestone notes, "or maybe your spouse has an alcohol problem, or your young child is having difficulty integrating into a new school. Issues such as that affect employees' work, which is why we created the Employee Assistance Program. Employees can get assistance from trained counselors without iXL ever needing to know."
iXL has also changed the way it looks at time off. Instead of segmenting sick days, vacation days, and personal time off, iXL now gives its employees a set number of days off per year, to be used at the employee's discretion. "We realized that standard sick days penalize healthy employees," Littlestone cites. New employees start out with 22 days per year, to be bumped up according to company practices. "We're also starting to offer a ‘Call in Well' day," Littlestone adds. "It's an extra free day for employees where they're feeling great that morning and just decide to spend it doing whatever it is they want."
Given its status as a public company, iXL offers its employees stock options, too, giving them a greater sense of corporate ownership. "We also offer quarterly cash bonuses based on a combination of individual and company performance."
Stock and cash options are also part of the norm at Atlanta based Mindspring Enterprises (to be known as Earthlink once the merger is completed). Like iXL, the large employer recognizes a need to go beyond acceptable benefits practices to keep quality employees in the fold. "We want employees to wake up in the morning and say ‘WOW,' I'm so glad I work for Earthlink," offers Ed Wolff, Director of Human Resources, whose title will be changed to Director of the WOW Experience, once the merger is completed.
Earthlink's benefits package gives employees the power to choose the benefits that most suit their current needs. "Employees receive fifty five flex dollars each pay period in which to choose from medical, dental, flex medical spending, vision, long term disability, etc.," he says. "If they want additional benefits, they've got the option of purchasing them pre or post tax."
To help them create a cost effective program, Earthlink hired Schultz Rowson, an Atlanta based employee benefits consulting firm to help them be more creative with existing funds. "It's important to be in tune with the industry, which is why we hired a consultant to help us in this endeavor," Wolff says. "It's also vital to know what the company philosophy is and help employees embrace that philosophy so they understand your passion and mission. Of course, they need to see deliverables, too. Thanks to Schultz Rowson, we've been able to stretch our dollars as far as they can go. So many other companies could do the same with what we spend."
Some of the items Earthlink's dollars go towards are education assistance, prepaid legal services, bonuses for new moms and dads, and 401 (k) matching. "Ours is a program that will continue evolving into the future," Wolff adds. "No one has a crystal ball, but if you're in tune with what's going on in the industry and in people's lives, you'll be in good shape."
For six years, Melissa Libby struggled with benefits program issues. In those first few years, the founder of Melissa Libby and Associates, a PR firm specializing in restaurants and hospitality, left it up to employees to find and pay for their own insurance. While she knew she needed to be more competitive, she didn't think it was possible for a company with just a few employees to offer benefits. Then she discovered a company called Employee Leasing. "I learned about them through my restaurant clients who were having the same problems I was in trying to offer benefits. Employee Leasing groups small employers together to offer medical, dental, vision, retirement. They've got all the basics."
Libby knows basics aren't enough. To show her constant appreciation, she tells employees to treat themselves and a friend or spouse to dinner at client restaurants such as Canoe, Food Studio, and Fratelli di Napoli. "Although they don't take advantage of it as often as they should," Libby cites, "my employees love it. It's such a great treat." Cash bonuses are also part of her compensation philosophy. "I don't have a strict bonus system," she notes, "but I try and offer cash bonuses when employees have done a super job, or have put in a lot of extra time. I like it to be something they appreciate, rather than something they always expect, and I think it feels good for them."
What feels good to some employees at MATCH, a small ad agency, is being able to do the laundry during work hours. "Why not allow people's lives to be easier," asks co-owner B.A. Albert. "The only problem is when the dryer beeper goes off in the midst of client meetings. At which point we simply explain what's going on."
Dogs are also welcome as are babies, now that the childcare room is set up to accommodate co-owner Elizabeth's newborn child. "We just hired Pete Walker to be our daycare provider, and we hope other employees will bring their children, too. There's no reason you can't have a baby around. It's smarter than working long distance, far enough that the noise isn't distracting, and yet close enough to take care of whatever needs arise." As for dogs, they've housed up to five at a time. "If you're going to do something for eight to ten hours a day," Albert notes, "it should be fun."
To create a fun environment, Albert simply incorporated things she liked from other agencies. "There really are no rules. There's no reason you can't build an environment to suit the individuals who work there." Once or twice a week, the firm hires a caterer to make lunch for the gang. Other times they grill out in their King Plow location, and suits and ties are only for client meetings.
Benefits programs and incentives may be an important part of keeping employees happy, but individuals such as Littlestone and Libby believe that's not the key reason employees stay. "Getting to do cool, challenging work, and having an opportunity to build upon existing skills is very important to employees," iXL's Littlestone remarks. "We're in the midst of developing a full blown training program for each department, something the company is investing a lot of money in." iXL employees also have the opportunity to work with alliance partners such as Sun Microsystems, Microsoft, Oracle. "Our employees have the chance not just to work on technology, but to develop it." Not to mention the fact that iXL helps employees relocate to any of its operations in the U.S. or abroad, if they're looking for a change.
While Match can't offer formal training programs like iXL, she believes employees get training by fire. "Our school is from real experience," Albert notes. "We throw people into situations where they learn fast and it's something they appreciate. Libby wholeheartedly agrees. "My goal is to structure the organization so employees never get to the point where they're not challenged," she says. "I'm the first one to say if they want to create a retail or music division of the company to further the challenge, that's cool. We'll work it out so they get a percentage of the profits. I'd like to think I'm creating an atmosphere where employees continually grow and earn more."
All interviewees point to open communication as the key to maintaining positive employer/employee relations. "Yell at us if you're not getting what you need," is the point Littestone tries to get across to employees. "Employees have a responsibility to challenge management. Don't jump ship, tell us what we can do. If we're not helping employees continue in their personal and professional development, shame on us."
Everyone can offer good benefits and incentive programs. There's definitely a misconception that companies need to be huge to offer good benefits and incentives. At least according to Dave Hatter, a benefits consultant with Schultz Rosen. Options abound, but first you need to be able to verbalize your culture, compensation philosophy, and what you want employees to think. "Most of all, you need to think out of the box," he believes. "A small firm could offer on-line enrollment where employees can view everything from the comfort of their personal computer, or there are all sorts of great retirement packages. It simply depends on what's important to the employer."
As for his own employer, Schultz Rosen offers a sick room where parents are free to bring their children instead of having to take the day off. "All it takes is a room," Hatter adds. Although his firm doesn't offer consulting services in the compensation area, he has seen his fair share of interesting offerings. One client offered a BMW convertible for each employee. Some companies offer annual all-expense paid trips for two. Hatter knows of other firms which offer concierge services, offering everything from tickets to picking up kids at practice. Then there's the company with the personal handyman who's available to do household repairs and minor improvements. On-site game rooms and meditation rooms are additional perks that keep employees happy. "There is no greater investment a company can make than their own human resources," Hatter offers. "All you have to do is get a little creative."