That's Not Fair: Benefits and Employee Retention
The Connection - September 24, 2008
by Michelle Sugerman
When the day's work was over, the owner of the vineyard instructed his foreman, 'Call the workers in and pay them their wages. Start with the last hired and go on to the first.' Those hired at five o'clock came up and were each given a dollar. When those who were hired first saw that, they assumed they would get far more. But they got the same, each of them one dollar. Taking the dollar, they groused angrily to the manager, 'These last workers put in only one easy hour, and you just made them equal to us, who slaved all day under a scorching sun.' (Matthew 20:8-12)
Attracting and retaining the best employees is critical to the success of small business. Even more important, is the perception of fairness as it relates to compensation and reward. In a period of exaggerated generation gaps and economic strain, how does one ‘catch and keep’ the finest staff?
- Recognize the Importance of Retention: Kate Schieldt of HR Partner, LLC says, “the price of replacing one employee adds up to thousands of dollars”. She recaps a short list of potential, but costly activities: updating a job description, advertising the open position, collecting and reviewing resumes, prescreening applicants, conducting first and second interviews, verifying references, administering drug and personality tests, negotiating the compensation package, submitting offer and rejection letters, compensating for lost of productivity and diminished team morale, all in addition to training and grooming the new employee.
- Identify the Top Workers: These workers consistently demonstrate superior skills, exhibit a good work ethic, desire more knowledge, take calculated risks, and are essentially coachable. They understand and behave according to the company’s values. Top employees are capable of self-leadership and set an example for others to follow.
- Provide What Best Employees Value: A benefit that is not PERCEIVED as valuable is not valuable. For example, employees are increasingly interested in eco-friendly options, especially on the heels of the summer’s record breaking gas prices. Schieldt says non-traditional benefits such subsidized commuting (i.e: bus pass) and flexible workweeks (i.e: four 10-hour days) continue to grow in popularity. Along with ‘green’ benefits, the older generation desires eldercare benefits. This, in addition to the childcare benefits enjoyed, and now practically expected, by the younger generation.
- Know Their Rights: Schieldt reminds employers of mandatory benefits, such as Medicare, Unemployment, Social Security, Worker’s Compensation, and for businesses over 50 employees, Family Medical Leave. She recommends working with an HR or financial professional to fine tune offerings and reiterates that discrimination on the basis of age, race, color, gender, creed or religion, marital status, national original, sexual orientation, disability, ancestry, citizenship, pregnancy or child birth, military service, or any other characteristic protected by law is not tolerated in the US.
- Encourage Utilization of Fair Benefits: When it comes to creating compensation packages, “larger businesses have more cash and smaller businesses have more flexibility,” Schieldt says, “but perceived fairness is key. They must be ‘generally offered to everyone’.” Benefits can reinforce a company’s values and its culture; so once offered, the use of benefits must be allowed and even encouraged.
Strangely, today’s ‘fair’ employee retention strategy stands in direct contrast to the ‘unfair’ parable of the workers in the vineyard. Through this illustration, Jesus reminds us that we can’t work harder for more forgiveness; instead, He grants us grace and mercy regardless of our deeds. Some would say this is unfair and that others are more or less deserving. Nevertheless, God’s love is completely unconditional --that is the whole point! “Take your pay and go. I want to give the man who was hired last the same as I gave you. Don't I have the right to do what I want with my own money?” (Matthew 20:14, 15)
Kate Schieldt, founder of HR Partner LLC, is committed to providing superior human resource expertise through innovative, value-added solutions. Kate has more than 15 years of senior human resource and serves clients in the retail, service, health, construction, insurance, non-profit and manufacturing industries. Please visit www.hrpartnerllc.com for more information.