Struggling with employee performance levels? Worried that your team is not engaged? Those are very real concerns and they affect everything from productivity to profitability and even employee retention.
A great deal has been written about using various tools and techniques to drive better engagement. There are whole philosophies dedicated to performance management, as well, including the current trend of using one-on-ones and regular check-ins instead of annual performance reviews. However, one area of the employee relationship is often overlooked, even though it has an impact on both engagement and performance: employee benefits.
What’s the Connection between Benefits, Performance, and Engagement?
It might be hard for those new to this discussion to understand how benefits drive improvements in performance and engagement. After all, what would paternity leave have to do with an employee’s ability to do their job well? Why would an employee health plan make people more engaged in their daily responsibilities?
To understand this connection, it is necessary to dive deeper. You must break out of the mindset that benefits are “nice to have” things used to entice new hires or to keep up with the competition. If you take a more employee-centric view, you’ll find that benefits are something very different:
They’re a primary factor in employee satisfaction, happiness, and loyalty to their employer.
So, it’s all about money, then? That is not the case at all. Increasingly, employees are happy to receive no financial raise, or even earn less in some cases, in exchange for work that better fits their personalities, talents, and interests, and for benefits that they find meaningful.
This is a dramatic departure from the way things once were when cash was king and people were hired because they were “young and hungry,” which was really just a polite way of saying they were ambitious to the point of sacrificing their quality of life to achieve some fleeting sense of professional success.
Of course, benefits come in all different shapes and sizes. The challenge becomes one of finding the benefits your employees want and that will drive the outcomes you desire. What do they want, though?
The Question of Benefits Employees Want
Too often, business leaders assume that money is the way to make employees happy. Understand that this is only the case if you’re not paying your team a survivable wage. For most employees, once they can live comfortably and are no longer stressed about how they will pay their bills, their interest turns to things other than money.
That means if you’re tying employee benefits solely to compensation in one way or another, you’re not going to see much of an improvement in performance or engagement. If you do, it’s a good sign that your pay is too low and it might be time to conduct a competitive analysis to find out where your compensation plans stand concerning your competitors.
So, if employees are not so interested in money, what do they truly want in terms of benefits?
Standard of Living Raises
Yes, this flies in the face of the aforementioned lack of interest in money as a benefit. However, that is because of the disconnect between employees and the C-suite on what “money-motivated” actually means. Employees want annual cost of living raises. They do not want incentives or benefits that they do not understand and will not use.
For instance, in an SHRM study, 71% of employees noted that they wanted standard of living raises, but only about one-third of employers actually provided those. In contrast, many employers provided a health savings account for their employees, but only 21% of employees found such an account of value. Additionally, less than 50% of employees wanted performance-based pay.
It should also be noted that standard of living raises also do away with many of the pay-related challenges facing both employees and organizations. For instance, it eliminates the potential for a gender gap. It also eliminates the possibility of raise-related discrimination based on race. In short, it levels the playing field while taking the pressure off employees to perform at ever-higher levels (which is impossible to maintain over the long-term).
Health and Well-Being Benefits
While standard of living raises are certainly popular, more and more employees are looking for health and well-being related benefits. The sky’s the limit here, but some of the options to consider can include the following:
- Additional Time Off: Employees are under more stress than ever before, but it can be impossible to recover while working. Additional time off to recharge is an important benefit that helps employees recover and shows that you understand and care.
- Meditation and Mindfulness Apps: The healing and restorative capabilities of meditation and mindfulness are well documented. Offering access to paid apps as part of an employee benefits package can be a great way of driving engagement.
- More Breaks: With stress at an all-time high for most workers, finding ways to deal with it is of paramount importance. One thing that you might consider as an employer is offering additional breaks during the day to recover from stress. Note that you don’t need to be in a high-stress industry for these benefits to be incredibly valuable.
Reducing stress automatically improves performance, but it also has the knock-on effect of increasing engagement.
- Nutrition Support: Nutrition is vital to physical, mental, and emotional health. Many employees want an on-site nutritionist they can go to for information about eating healthier and adopting new eating habits, but few employers offer anything similar. Doing so can be a very good way to boost performance and drive up engagement.
- Fitness Trackers: Physical exercise is as important to mental, emotional, and physical health as time off or nutrition. By providing employees with fitness trackers, you empower them to be healthier and feel better, and they reward you with improved performance and engagement.
As you can see, many benefits can drive both performance and engagement. Take a long, hard look at what you’re offering your employees and compare that to what they really want. A few key changes could yield major results.