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Employee benefits refer to indirect non-financial compensations provided to employees in addition to their usual wages and salaries. Employee benefits are sometimes referred to as perks or fringe benefits. Whereas some benefits such as retirement pensions are mandated by law, most employee benefits are initiatives of the employers, for instance, paid holidays. Employees today expect extra rewards other than the normal salary.
Employee benefits have incredible importance in fulfillment of human resource management goals. First, it boosts employees’ morale which consequently results into increased productivity. It results into low rates of absenteeism because employees often enjoy being at the workplace and they remain delighted with what they earn from them sweats.
Secondly, it leads to low employee turnover. This helps in cutting down unnecessary recruitment and administrative costs when employees leave. Employee retention remains high. Thirdly, it builds high self-confidence and motivation of employees which in turn boosts performance at the workplace, and hence increased productivity and efficiency because less organizational time, energy and resources are spent in employee related complaints. Employees, like any other individual, would like their efforts acknowledged.
Fourthly, certain perks such as pensions and medical insurance gives employees a peace of mind. They feel relieved of the unknown future. Fifthly, fringe benefits facilitate organizational effectiveness. This is because employees will build trust in the organization, build the organization’s image as well as strong organizational culture. They will feel more secure because of certainty at the workplace. It also builds employee loyalty. These are in turn translated into high commitment to duties and efficient use of the company’s resources. This is beneficial to the company.
Moreover, employee benefits facilitate attraction and retention of a pool of highly qualified individuals. These highly qualified personnel brings into vast experience, knowledge and expertise. Fringe benefits offered to employees also promote good work habits such as honesty as well as building strong and mutual relationships between the employees and the employer.
Last but not least, employees benefits results into less risk involved in management of workers, for instance, there will be few or no cases of workers’ strikes. This also facilitates organizational compliance with statutory laws and regulations.
Genentech and Zappos have been using benefits to develop feelings of importance amongst employees. Through regular rewards and recognition of employees, the companies indirectly motivate their employees. Moreover, the employees feel socially secure when they are offered fringe benefits such as healthcare insurance and retirement benefits. In my view, the two employers have been able to adequate meet the individual and family needs of their employees. When Genentech and Zappos reward their employees for their great achievements, the workers feel respected. The workers feel that they are important assets to the organizations. This acts as a great source of motivation to the employees.
In my view, offering additional benefits such as pet insurance in addition to the traditional retirement and pension schemes and healthcare insurance makes employees understand that the companies are well concerned with their welfares. Social activities such as pajama parties offered by Zappos provide adequate recreational, refreshing and stress releasing activities to the employees. This boosts their moods at the workplace since a conducive work environment is created by the employers.
Furthermore, provision of a full time life coach indicates the company’s long-term interest in the employees’ future lives. It also symbolizes interests of the employers in seeing their employees grow both at work and in their careers. Through provision of additional fringe benefits, the two companies have developed high job satisfaction levels amongst their employees. This indicates the companies’ abilities in meeting and exceeding employees’ expectations, which consequently results into higher employee motivation. Similarly, fringe benefits lead to contentment at the workplace, which facilitates good attitude, interpersonal and communication skills hence sources of motivation to employees (DeCenzo & Robbins, 2007).
In my view, these incentive benefits can be deployed by other organization as well. Other organizations can also align their employee benefit programs with those currently in the market. In addition, employers can offer protection of employees’ rights such freedom of association by allowing them to form or join clubs at the workplace.
Employers can also provide equal training and development to their employees. They should provide equal opportunities for promotions and career advancements. Employees should be involved in decision-making processes of the organization since they are important sources of information. However, due to hard economic times experienced across the globe, not all organizations will be able to provide employees, for example, infant organization that are still at their growth stages may focus more in investment opportunities.