Just show me the money

Perks are out as a means of tempting job hunters, as they'd rather have cold hard cash. Picture / Warren Buckland

Job perks can be the icing on the cake - that extra something that sweetens the pot, rewards exemplary service or convinces the employee to stay put.

Well, that's tended to be the idea from the employer's point of view. From the employee's, it's more likely to have been about getting more income once the salary has been pushed as high as the boss can stand, pocketing extra without paying extra tax, or simply separating the men from the boys.

Those status-enhancing objects of workplace desire such as the key to the executive washroom and the conveniently located parking space can symbolise those who've made it and those who have not.

"The range, mix and value of benefits are much higher the further up the tree you go," says Kevin McBride, director of McBride HR.

And there are clear reasons why perks shadow position.

"At one stage you are trying to recruit into the workforce for a start-up job and you are relying on [providing] training, experience and so on. At the other you are probably trying to pull someone out from somewhere else where they've got a reasonable package."

Job seekers are not likely to get the lowdown on perks in the job description, however.

"Why would you want to put it in an ad and commit yourself? Get the fish to bite first," says McBride.

Once a candidate has been shortlisted for a job employers will spell out the benefits on offer. It's also up to the successful applicant to negotiate a package.

Typically, entry level benefits include medical insurance, superannuation and, where necessary, moving costs.

At the top of the tree, perks can include salary continuance insurance and bonuses. Ninety per cent of senior executives have bonus provisions compared to around 30 per cent of workers at operational level, McBride says.

Data from the March CubikSurvey of remuneration for middle management shows that as well as the perks they've built up in their junior years, mid-rangers get a mix of bonuses, commissions, company cars, expense allowances, share options and housing allowances.

Middle managers' most popular benefit is superannuation. More than 35 per cent of the survey group, whose average base salary was $70,582, got super with the average value of the employer contribution amounting to $4795, or 6.1 percent of the average total remuneration.

But only around 30 per cent of companies offer super, McBride says, and it is difficult to tell from statistics whether people aren't taking it up because it isn't offered or because they simply don't want it.

The popularity of schemes did take a hit with the passing of the days of a career for life and a fixed super scheme, but the advent of transferable schemes had made them more popular with young people.

The second most popular perk for mid-rangers in the survey was bonuses, with payments averaging $5854 made to 32.1 per cent of the group. Medical benefits were received by 25.4 per cent and 18.5 per cent got a vehicle.

Relatively few middle managers get 'unvouchered' expense allowances, McBride says. Most are required to seek reimbursement of expenses on production of receipts.

Share option schemes and housing allowances featured only minimally among the middle management group - perhaps an indication that those perks are corralled for those higher up the ladder, or a sign of a different kind of shift altogether.

Dale Gray, Auckland general manager of recruitment firm Momentum, says many perks are going the way of the dinosaur.

"The trend for the last five or so years, from an employer's perspective, has been to cashing up."

The days of putting multiple components in a remuneration package such as medical insurance, a vehicle, and superannuation are passing, Gray says.

"It's partly driven by the employees not putting value on those things and wanting their own choice. Secondly, there's quite a lot of compliance cost for employers such as administration for fringe benefit tax on motor vehicles."

Cars are still offered as tools of trade, for sales positions for example. But where once it was common for, say, a financial controller to have a company car, now it is extremely rare, he says.

Share option schemes are essentially gone.

"They were over sold and under delivered," Gray says. "Generally, they have quite stringent and fairly long, tenuous vesting requirements - you can't just get the money and sell them. Secondly, a lot of the upside was never realised. If anything, people felt quite deflated by it all."

And things once considered perks, such as gyms and flexible working hours, are now more likely to be expected of good working environments.

Paradoxically, childcare, which was once considered the height of good working conditions, is now considered a perk.

An in-house creche can be of immense value to an employee, and to an employer seeking to attract parents back to the workforce, says Gray. But he warns that provision of childcare can also cause workplace jealousy.

"It tends to be used as a retention tool for talented people but it can be seen as discriminatory behaviour so it can cause a bit of unrest among the workforce." Childless, young or older workers may resent the childcare 'perk' because they get no direct benefit from it.

Gray believes there is little correlation between perks and why staff stick around, something reflected in a 2003 Canadian study. It found only "moderate support" for the idea that so-called innovative work practices such as teamwork, job rotation and profit sharing reduced employee turnover.

"Quite clearly we know that people stay in their job because of job content, values alignment and day to day culture," Gray says.

The Statistics Canada study suggested, however, that the attractiveness of perks may depend on the type of workforce.

The study examined turnover in three sectors: manufacturing, high-skilled services and low-skilled services. There was "almost no evidence" that the perks reduced turnover in the manufacturing sector.

However, employers in the services sector using a highly skilled work force - including the finance, insurance and professional industries - and implementing some innovative practices, did manage to hold on to a greater proportion of employees than others.

In that sector, companies with innovative strategies lost about 4 per cent of their employees, compared with 16 per cent of those with no similar practices.

The study also found some evidence that the low-skilled service sector workplaces that had teamwork and profit-sharing plans retained a greater proportion of their work force than other establishments.

Those employers - which included the retail, wholesale and consumer services sectors - which combined teamwork and profit-sharing lost about 13 per cent of their workers, compared with 19 per cent of those not using similar strategies.

Gray believes perks are most popular with older, Generation X workers who have grown up with them. Gen Xers are more likely to value the status conveyed by a perk such as a car while the younger Gen Ys "want flexibility, immediacy, and things here and now," he says. "They want money now."