For unto every one that hath shall be
givenů..but from him that hath not shall be taken away. St.
Many studies have shown that it is difficult to draw
conclusions from the effect of benefits and perks. Typical benefits, in addition
to a wage or salary, are: car, share
options, staff discounts, medical checkups, counselling, private healthcare,
dental insurance and subsidized restaurant. These usually attract the interest
of the government authorities for personal taxation purposes. While benefits are
usually written into a person's contract of service, perks are more unofficial.
Typical examples are: managers use of the front car park or executive dining
room, craftsmen being able to take home scrap for their own use, employees being
able to purchase goods at a discount, etc. Perks, in general, do not attract
additional personal taxation.
There seems to be a consensus
that benefits and perks may lead to a person having greater commitment and being less
likely to change jobs,
particularly if they are earned only after some years of service. However, their
existence will not make people actually work harder or lead to
increased productivity. The larger the
organization, the more likely it is to provide a range of benefits for its
staff. Small organizations, and particularly those in the non-commercial sector,
generally lag behind in this area.
Benefits and perks can reduce staff turnover with all
the attendant costs of hiring and training new employees. However, they may make it
much more difficult for the organization to encourage those staff
who are not contributing effectively to resign without a large payoff. They
often act as a symbol of status within the organization.
Benefits cost time and money: Benefits
cost the organization money (typically up to 30 per cent of a person's salary)
and resources to administer, but many employees would actually prefer to be paid
more salary and receive less in the way of benefits. As a person progresses
through their working life, the type of benefits needed will change; with
healthcare and contributions towards a pension becoming more important as people
approach retirement. As a result, many companies have turned to flexible benefits packages, which
operate on a 'self-select' basis, where benefits can be tailored to suit the
individual's needs and exchanged for positive or negative salary increments.
However, these schemes usually require the employee to take a minimum set of
benefits - everyone needs some holiday!