Big Employee Perks on a Small-Business Budget

You don’t have to spend a million to make your
employees feel like a million bucks. Fortune 500
companies might make headlines for the generous bonuses
and exotic vacations that they bestow upon their star
performers, but extravagant gifts don’t necessarily
lead to happier employees.

by Judy Artunian

The purpose of employee perks — those extras you give
to employees for a job well done — is to keep employees
motivated by showing them that you appreciate their
work. One sure-fire way to win your employees’ devotion
is to ask them what you can do for them. You might
expect a flood of requests for a company car or other
budget-busting perks. But small-business owners who ask
employees what they need report that most workers come
back with modest requests such as a job title change or
training in a new skill.

If you would rather surprise your employees with a
unique gift, consider tailoring your perks to each
person. One advantage of having a small organization is
that you get to know your staff well enough to have a
sense of who would throw their arms around you in joy
if you presented them with a Home Depot gift card, and
who would respond with a weak, "Oh, thanks."

Avoid group rewards. A monthly staff lunch at an
upscale eatery is a thoughtful gesture, but most
employees would tell you privately that lunching with
co-workers doesn’t make them feel personally rewarded.
It also bypasses that all-important element of
surprise. It’s like a birthday gift that you have
selected for yourself. You appreciate it, but you know
that the gift-giver didn’t take time out of his day to
think about what would make you happy.

That doesn’t mean you can’t provide a perk that
everyone can enjoy. One small business hired a
financial adviser to meet with hourly employees who
typically wouldn’t have access to the advice of a
professional financial adviser. When the employees were
interviewed later, they pointed to that perk as one of
qualities they most appreciated about the company.

Consider offering a certain number of paid days off for
employees who want to take a break for a few weekdays
to unwind after completing a stressful project. This
bonus could yield a double benefit. In addition to
rewarding your employees, you are indirectly rewarding
the entire company by helping an employee avoid burnout
by letting him regroup away from work. Another way to
address the needs of employees under stress is to a
give gifts to spouses of workers who put in long hours.

Remember, if you are rewarding employees based on a
performance outcome such as meeting sales goals, reward
only those who were directly involved in the successful
endeavor. If it was a team effort, think equality when
deciding how to reward the team members. That means
avoiding large discrepancies between the perks of
executives and clerks. For instance, if your marketing
department orchestrated a successful advertising
campaign, don’t present the senior marketing manager
with a $20,000 bonus if the assistant graphic artist is
getting a $500 bonus. The reason? In a small company
people talk to each other. A better strategy is to make
the bonus an equal percentage of salary or sales, and
let everyone know that is how the bonuses were
structured.

Finally, there is a less tangible way to acknowledge an
employee’s performance that may be more powerful than
anything money can buy. In addition to presenting a
traditional perk, ask the employee to sit down with you
and his other colleagues and explain how he
accomplished the feat for which he is being honored.
Staffers who work away from the limelight will be
particularly flattered by this request. We all have war
stories and insights that others can learn from. When
you ask employees to share those experiences, you
remind them that you value their role in the company’s
success. And that’s something that a pricey exotic
vacation can’t quite touch.

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