Non Monetary benefits over monetary benefits are the new age mantra for our employees. We prefer the money but we also need the benefits, flexi time, personal space and many more… So what is it that keeps the new generation happy, let’s take a look-
Employee rewards have been an integral part of Organizations and are considered a must for enhancing employee engagement and productivity. However, of late, there has been a drastic change in the employee rewarding system as employees are keen on receiving several intangible benefits from the employer, apart from the usual monetary benefits. Here’s how people managers are re-working on employee benefit schemes to match changing employee expectations.
You think a good compensation package and annual perks satisfy your employee and keeps him/her going? Think again, as monetary benefits alone will not work anymore as today’s employees count on several non-monetary benefits from employers to stay productive at work. Monetary rewards have very short-term benefits as opposed to non-monetary ones. Also, it’s been observed that employees often complain after receiving monetary gains and usually aren’t satisfied with the benefit given. Therefore, it is better to move from monetary forms of benefits to intangible ones.
A good salary is a significant factor that plays a huge role towards influencing the decision making process of an employee while choosing his/her employer. But as the person moves up in his/her career ladder, aspirations regarding benefits from the employer also change. It depends more on the level of career one is in, experience, personal needs, etc. The expectations from non-monetary benefits proportionately increase according to the level an employee grows in his/her career. An entry level employee expects monetary benefits and a supportive work environment; the supervisory staff may expect a competent pay structure wherein they could earn more, have tax provisions and receive timely appreciation from the management to encourage the team to perform; the managerial staff will be looking beyond all this and expect opportunities to shoulder empowered roles including responsibility with authority, freedom to choose working hours and basic decision making with respect to their teams, etc.
Adding to it, employees at an early stage of their career prefer short-term and monetary benefits since settlement in life is their first priority. However, a simple letter of appreciation or pat on the back as well as training nomination or special assignment, which is beneficial for career advancement, excites the younger generation.
The benefits that employees look for from employees depend on their personal priorities too. For example, a working mother would look for benefits like work from home, flexi-working hours, transportation facilities, work out-of-home, daycare centre provisions, etc; also, family engagement involving the family in various aspects of the company’s work practices, free time to pursue one’s own research/hobby/pet-projects, paid sabbaticals to further enhance academic knowledge, paid holidays, additional leaves for paternity, gifts in kind or gift vouchers, etc.
Employees look forward to a good working atmosphere where meritocracy is respected, various employee engagement activities are practiced, good talent is recognised and opportunities are provided to grow and interact with members of the senior and top management.
Such intangible benefits are advantageous for both, the employee and organization and helps in creating an emotional connect between the employee and organisation that could turn beneficial in the long run.
However, there is a word of caution for employers before implementing non-monetary benefits for their employees.
Non-monetary benefits work well under two circumstances:
(1) when the employee is well paid and the company is comfortably positioned on the salary benchmarking scale and
(2) there is a limited ability to pay and thus, a need to be creative. It is only when employees start realising that their cash flow has reached a plateau and they are also comfortably placed vis-à-vis the market, would he/she start appreciating non-monetary benefits. Thus, good employees need both, tangible and non-tangible benefits and it is time organisations invest in providing a steady mix of both to their employers to attract and retain the best talent.