Firms Find That Employee Perks Return Big Bonuses : Labor: Incentives are credited with producing staffs that work harder. One employer stresses having fun.
If you work for Fel-Pro, an Illinois gasket manufacturer, here are some of the perks each of your children can expect: a $1,000 savings bond at birth, free summer camp, private tutoring if he or she is a slow learner, a $100 check at high school graduation and $3,000 a year for four years toward college tuition.
At Ben & Jerry’s, the Vermont ice cream maker, full benefits are extended to homosexual couples and heterosexual unmarried partners.
Hewitt Associates, which designs compensation and benefit programs, gives employees an extra 15 vacation days on their 15th, 20th and 25th company anniversaries--not to mention free lunches and bonuses for wearing seat belts and for not smoking.
At Donnelly Corp., a Michigan firm that makes glass products, you’ll find Chief Executive Officer Dwane Baumgardner and other executives on the loading docks at 5 a.m. just before Thanksgiving, handing out turkeys to workers.
And here at the headquarters of Southwest Airlines, CEO Herbert D. Kelleher has made a sense of humor a requisite for employment. Workers receive generous perks and place a high value on camaraderie and the notion that having fun on the job is as important as working hard.
The resulting employee loyalty has contributed mightily to 20 consecutive years of profitability in a notably unprofitable industry.
Southwest’s reputation as one of the nation’s best places to work prompted 85,000 job applications to the airline last year alone.
While much of America agonizes over corporate downsizing and diminished worker benefits, these are among an elite group of companies that have not deserted their employees. Even in tough times, they have remained committed to offering handsome incentives and treating their people as the company’s most important asset.
Their reward has been employees who work harder, smarter and more efficiently--and consider an enlightened workplace just as important as the size of their paycheck.
Numerous polls show that most American workers no longer equate money with either success or job satisfaction.
In one survey, the Families and Work Institute in New York City reported that 82% of Americans defined success in work as the personal satisfaction gained from doing a good job or earning the respect of supervisors and peers. Only 21% listed making a good income as the definition of success.
Of the workers who had taken jobs in the last five years, the top five reasons for picking the new employer were open communications, the effect of the job on personal and family life, the nature of work, the quality of management and the characteristics of supervisors. Salary ranked 16th.
“Nothing drives productivity by itself,” said Robert Dewar, associate professor of management at Northwestern University, “but when you combine liberal perks with a good appraisal system and getting rid of people who don’t keep up, you’re going to get a lot of productivity and a hell of a lot of loyalty. People are knocking down the door to work for companies like Fel-Pro.”
After being profiled as a company with a heart in “The 100 Best Companies to Work for in America,” a book by Robert Levering and Milton Moskowitz, Fel-Pro had so many calls from journalists wanting to interview its employees that it turned down all requests for on-site visits in order not to get distracted from its business as the world’s largest maker of gaskets for automobiles.
“Besides, the good publicity cuts both ways,” said Rich Morris, Fel-Pro’s director of communications. “Half the clients call to say congratulations. The others call to say: ‘If you’re doing that much for your employees, you must be charging too much.’ ”
But, he added, it is precisely because Fel-Pro does do so much for its employees that the employees are dedicated to maintaining the company’s competitive advantage.
Like many employers, Mitchell Thall, president of Epicure, a Miami Beach gourmet market that has been in his family for four generations, finds that providing liberal benefits--including annual profit-sharing bonuses for all employees, contests for free cruises and tickets to sporting events and a policy of never terminating anyone who needs a leave of absence to deal with personal problems--is a good investment.
It has given Epicure a stable work force and a reputation as one of southern Florida’s most successful customer-oriented businesses.
“People today are looking for much more than a paycheck,” Thall said. “They want security. They want respect and a clean, safe, wholesome work environment. They want to be treated like human beings. That may sound obvious, but a lot of employers still don’t get it.”
Although the bonds of loyalty between employer and employee have been frayed by the economic turmoil of the ‘90s, there is, management consultants say, a growing awareness in corporate America that quality production and global competitiveness is directly related to the kind of workplace it provides.
Almost every day one corporate group or another descends on Southwest Airlines to study the secrets of its success.
What they find is that Kelleher--a chain-smoking, bourbon-drinking, workaholic prankster--has created a company culture: Southwest isn’t just an employer; it’s a family, a place where you’re expected to work hard, have fun and care about each other.
No one gets hired at Southwest without providing a satisfactory answer to the question: “Tell me how you recently used your sense of humor in a work environment.”
Flight attendants have sung safety instructions over the intercom to the tune of the “William Tell Overture,” and Raelene Chilcoat used to hide in the overhead luggage bins and pop out at startled passengers.
Kelleher, 62, who likes to impersonate Elvis Presley, dressed up as a bunny one Easter and walked down the aisles of a full plane, passing out candy. Another time he arm-wrestled another CEO over the right to an advertising slogan both companies claimed.
When Southwest interviewed several hundred job-seekers in Phoenix recently, its three executives walked onto the stage dressed in jackets and boxer shorts.
Ed Stewart passed five interviews with flying colors, but he didn’t get hired until after he had shown up at the company’s annual chili cook-off.
“I knew what was happening,” Stewart said. “They wanted to see how I interacted with people.”
When Stewart later turned down a better-paying job offer to stay with Southwest, Kelleher came into his office and kissed him.
“I didn’t know a place like this existed when I first went looking for a job,” said Denise Zachry, manager of leadership training.
Southwest was the first airline to introduce profit-sharing in 1973, and three mechanics have already retired as millionaires. Employees can wear shorts and sneakers to work during the summer, and the corporate headquarters all but shuts down on Halloween for a daylong party.
Every employee gets one extra “free day” off a month, two round-trip airline passes for each three months worked without an unauthorized absence and the ability to switch days off with their colleagues.
How do employees respond to being made to feel special? In 1991, when the Persian Gulf War forced up fuel prices, they collected $135,000 for an emergency fuel fund. Last year they were responsible for Southwest winning the industry’s coveted “triple crown” for on-time arrivals and the fewest number of lost bags and passenger complaints. The no-frills carrier has made a profit every year since 1973 and never had a layoff.
“I’ll tell you how I feel,” said Gary Lopez, manager for in-flight services in Dallas. “I take a vacation and I almost feel guilty. A Southwest plane goes overhead, and I think: ‘Wow, I ought to be back at work. The company can’t make it without me.’ ”
