By Lisa Fattori
Special to The Toronto Sun
The extravagant company perks of the heady 1990s have lost some of their luster. The economic slowdown of the past two years has tempered employee reward programs to better accommodate this new economic reality.
Today's incentive strategies offer a great deal more flexibility in bonus structures, benefits and working schedules. They are designed to benefit both employees and the corporate bottom line.
"Stock options are not as popular and some of the latte machines have certainly gone," says Gail Evans, president of the Wynford Group in Calgary. "The big trend, today, is variable pay and bonuses based on performance."
Performance-linked rewards help focus employees on key corporate objectives. Project-based compensation motivates workers to attain particular goals. The success of the group or the individual translates into success for the company. The base salary/hefty bonus formula also allows employers to better control costs.
The signing bonuses offered to new graduates a few years ago have been replaced with bonus structures that span several months. "This is a better retention strategy," Evans says. "There has been a greater focus on retaining key employees, so their packages are quite substantial. Instead of applying bonuses superficially, employers are being much more selective."
Another tangible that employees are looking for is an attractive benefits package. "Given this very saturated market, particularly in the technology sector, individuals are seeking a stable employer, a fair base salary and a solid benefits package," says Arlene Kring, senior vp with recruitment firm, Prospect Search Partners. "While health club sponsorships, laptops and cell phones are welcome, they are not necessary to attract candidates who may have been unemployed for some time, or who are expecting to be downsized out of an organization."
Broader, more flexible medical and dental plans are in demand, and employers are re-sponding by offering a great deal more choice.
Some companies are implementing a health spending account. Here, employees can put aside pre-tax dollars that can be applied to additional health and dental costs. Canadian Tire Corporation offers its corporate employees a flexible benefits program than can be used as needed.
"You can ramp it up as much as you need it," says Jennifer Sexton, public relations manager for Canadian Tire Corporation. "You may want it for dental rather than medical purposes; or you can put it in a healthcare spending account for things not covered by OHIP. You can opt for cash, or take it in the form of time off."
Canadian Tire also offers its employees a stock purchase plan, recognition programs, tuition reimbursement, and a whole host of incentives under its "The Rewards Along The Way" program. Both corporate employees and retail staff receive employee discounts and a scholarship program is available to the children of all employees.
A company's corporate culture can either inspire or de-motivate employees. Soft initiatives such as flexible working hours, time off, or enhanced training opportunities all work to make an employee feel
"The non-cash component, such as more recognition programs, can be just as important," Evans says. "Companies need to have a broader strategy that supports the cultural needs of their employees."
Opportunities for part-time employment, continuing education or lateral moves within a company offer employees the freedom to make changes and to learn new skills. People with big commutes are looking for flexible working hours and the opportunity to telecommute from home a few days a week.
In addition to the work/life balance demands by more and more employees, is the importance of job satisfaction. Employees want to feel that their work and contributions are of value to the company. While monetary rewards are certainly effective, for many, employee empowerment is the greatest motivator of all.
"Employees are looking at the intangible features of a company such as the opportunity for decision-making and implementing change," Kring says. "At the management level and beyond, people are saying, 'I want to have an impact. I want to be an important contributor to the team.'"
(Lisa Fattori (email@example.com)
is a Toronto-based freelance writer.)
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