Employees Value Culture Over Benefits

Some time ago, a researcher appeared on Bloomberg and made a claim that employees were giving up salary increases in exchange for benefits. The statistics he cited were striking and had a mischievous title: "Americans Are Willing to Give Up a 56% Salary Increase for the Best Benefits".

At the end of the day, I agree with the researcher's findings, if not with the title of the article. Of course employees are not willing to give up salary increases for benefits! But they may prefer criteria such as increased meaning at work and more autonomy - the right cultural fit - over money. Employees who choose meaning over money do so because their values align with the core values and opportunities embedded in the company's culture. Great culture requires hard work and effort - it's hard - whereas it's easy to offer attractive benefits and perks. That's why handing out attractive benefits does not guarantee that you will create a great culture.

Definition of Benefits

I was surprised by some of the words of the researcher speaking at Blomberg because he was defining the term "fringe benefit" differently and this is confusing for many people. Let me explain what I am talking about. One of the logical explanations of the concept of a fringe benefit is that it is a form of payment that is not directly cash and that creates additional benefits for the employee, so salaries, health insurance, pensions, all those things that are measured in banknotes are not really fringe benefits.The list of benefits reported in Bloomberg was, by its very nature, inconsistent with what we traditionally understand as benefits. In most HR circles, benefits are things like attractive break rooms, in-house exercise rooms, employee daycare centers, etc. Yes, these benefits have a monetary value, but their value is indirect for the employee.

It is important that these benefits are also related to the values centered around the culture of the organization, but they should be in line with the real values of the organization, not the values written on the walls.

Employee Engagement Drivers

The list of benefits that the Bloomberg researcher came up with included paid time off, low physical activity, freedom for employees to schedule their own time, training opportunities, and so on. These findings are not surprising to us at Success Programme, because these are benefits that support what our partner Decision Wise has found in years of research, namely that employees are motivated more by meaning, autonomy, development, impact, and belonging. We call these the drivers of employee engagement, the five keys to employee engagement, and they make up our employee engagement model, M.A.G.I.C.

So, things like the freedom to schedule your own time that the Bloomberg researcher mentioned are not a surprise to us. We know that offering enough employee autonomy is vital to building a culture of employee engagement. The same can be said for company-sponsored training.It's really about an organization valuing its people and providing development opportunities for them. Can they see themselves getting to a better place professionally in their career, both in terms of skill sets and opportunities? In a nutshell, these are not benefits, they are cultural attributes.

A Culture Built Around Values

Ultimately, while the Bloomberg researcher is wrong on some of the items on the benefits list, I agree with the core of what he says. He correctly points out that cultures built around values that matter to employees are more successful at fostering employee engagement than cultures that focus on traditional benefits, pay and incentives, such as direct employment compensation.