By Julie Deardorff
Tribune Staff Writer
April 11, 2000
NEW YORK — When Lenox Hill Hospital began offering employees the option of pet insurance this month, Rene Castro immediately signed up. For $2 a week, Castro receives HMO-type medical coverage for his dog and cat, two beloved but costly creatures that recently have racked up more than $3,000 in veterinary bills.
Lenox Hill’s pet perk, albeit quirky, reflects the leading edge of a burgeoning national trend born of the rapidly shrinking labor market. Companies everywhere are dreaming up and dangling new and sometimes rather exotic benefits and incentives in an effort to attract quality workers and keep them.
Gone are the days when employee benefits consisted of a mundane menu of medical, dental, life insurance, disability and 401(k) offerings. These days, workers at American Express, AT&T and Tower Records have access to legal services through payroll deductions. KPMG, the international accounting firm, uses a national concierge service to help employees secure tickets, plan vacations or locate a hair stylist in an unfamiliar city. Chicago-based Andersen Consulting offers employees a free dog-walking service. And employees who stay more than three years with Quick Solutions, a computer consulting business in Columbus, Ohio, receive free monthly housecleaning.
While pet insurance remains relatively rare–offered by 1 percent of companies–it ranks among benefits growing in popularity, according to the 2000 Benefits Survey by the Society for Human Resource Management, released this month. Other increasingly sought-after benefits include breast-feeding accommodations, elder-care referral services and gym subsidies, according to the society.
“We can’t afford to do the more extravagant things but, as a non-profit competing with corporate America for back office positions, we need to do something,” said Erin O’Connor, vice president of human resources at Lenox Hill, located on Manhattan’s Upper East Side. “We’re feeling a bit of a staffing shortage in critical-care areas, so if [pet insurance] makes us more attractive and helps us keep someone who is already here, it’s worth it.”
Whether these benefits really are effective at luring and retaining workers is a matter of some dispute. Alex Hiam, author of “Motivating and Rewarding Employees: New and Better Ways to Inspire Your People,” said the new elective benefits are “good for recruitment.”
But, he said, once hired, employees tend to take the benefits structure for granted. “It becomes an assumed part of what you’re worth and loses its value very quickly in terms of motivating people to stay longer or do better than they would otherwise,” he said.
While Hiam said fancy perks aren’t always as effective as employers might hope, he conceded they can’t be ignored either. “It’s just part of the tipping of balance from the employer to the employee, because now it’s harder to find good workers,” he said.
Indeed, employers, many getting somewhat desperate to find talent, are doing everything they can. For the first time this year, an “unusual benefits” section was included in the society’s benefits survey. It found that 41 percent of employees had access to company-purchased tickets for sporting or cultural events. Halloween parties (36 percent), theme days (34 percent) and ice cream socials (32 percent) also were listed as unusual benefits.
“The little things really matter now,” said Angela Camera, spokeswoman for the society. “The whole workforce in general is not so much concerned about how much money they get but about flexible benefits. They want the work and professional life balance, the telecommute, the educational assistance and the professional development.”
Technology companies, where job-hopping is rampant, are offering some of the most unusual perks. Linkage, a human resources consulting group in Lexington, Mass., recently found that more than 40 percent of the technology workers it surveyed would consider moving to the same position elsewhere for the same pay and benefits. With this fickle group, overall compensation ranked 11th out of 12 factors studied in terms of effect on retention.
“A lot of dot-com technology companies use financial education programs as a benefit,” said Alan Cohen, CEO of Online Benefits, which helps businesses create human resources Web sites. “Companies that have a younger population making substantial amounts of money are finding it’s important to have a [financial] consultant on call.”
In fact, Hewitt Associates, a benefits consulting firm in Lincolnshire, recently found that 86 percent of employers provide investment education for employees, up from 59 percent two years ago. Through expanded financial and legal assistance, employees can receive help with wills and estate planning, home buying, traffic violations, personal budgeting, and investment planning. Car and homeowners insurance, available through payroll deduction, is another popular elective benefit.
So-called quality of life benefits, running the gamut from on-site massages to well-stocked company kitchens, are making an appearance at many companies. IBM Interactive Media, Delta Air Lines, BellSouth, Coca-Cola and AT&T all hire Stress Recess to provide free, 15-minute chair massages to employees.
Massachusetts-based Monster.com, an on-line global career network company, has created the Monster Den, a space in the middle of the office where the walls are plastered with murals of monsters, and workers unwind with foosball, Ping Pong or pool. Attached to the Monster Den is an indoor, ventilated room for smokers, complete with whiteboards and dry markers for creative brainstorming.
Even travel perks seem to be getting better. For a strategic planning meeting next month, Fortune Magazine will take staffers on a three-day trip to the Hawaiian island of Lanai. InfoShark, a Virginia-based software development firm, has partnered with Greek Cruises to send employees on learning/teaching vacations in the Caribbean and Alaska.
Not surprisingly it’s the start-ups and dot-coms, which are still establishing their corporate cultures, that are pioneering some of the more unusual free benefits. For example, employees of TheSquare.com, an Internet site for graduates of “prestigious” universities, have Wednesday mornings off to take care of errands like doctor’s appointments, haircuts and PTA meetings. California’s Lowermybills.com offers valet parking with a car wash, weekly massages and trips to Universal Studios, located next door. At ChefShop.com, a small purveyor of specialty foods in Seattle, the whole staff participates in taste tests. Company officials insist that “one taste of White Truffle Honey could bring a person to contemplate a career move.”
“It’s an invigorating, energized work environment, where everyone is working together as a team, that makes people stay,” Cohen said. “It’s not the old, stodgy companies that are offering the fun or interesting benefits. It’s the more progressive places.”
But Joan Stewart, author of several booklets on recruiting and keeping employees, warns that companies should not be lulled into thinking that the perks keeping employees happy this week will be the same ones six months from now. Also, one industry’s perks don’t necessarily work for another. “The big things [technology] workers want is constant training and the ability to tackle unusual projects that will bring them better job skills,” Stewart said.
Others just want Fluffy and Fido to be happy and healthy. A study by Veterinary Economics magazine showed pet health care costs an average of $173 per year and is rising at an estimated 30 percent annually.
At Lenox Hill, the enrollment deadline for pet insurance was extended through May because of unexpectedly high interest. Employees there contribute $4 per pay period and choose from a list of veterinarians and service providers.
Castro, a supervisor in Lenox Hill’s equipment processing department, was thrilled when he heard about the program. His Maltese dog, Princess, recently leapt off the couch and dislocated a disc. He and his wife paid $750 for the CT scan alone. Meanwhile, treatment for a uterine infection in his cat, Mitzu, rang up charges of $1,800.
“The bills can be high at times, especially when you care for pets like we do,” said Castro, 53. He said the pet insurance alone could keep him happy at Lenox Hill. “It’s very important. I never dreamed something like this would be available.”