Overrated and Underated Job Benefits
Tips for new and ongoing employee negotiation.
Posted Feb 07, 2019
It’s surprising how much weight many employees give to whether the workplace has a ping pong table, espresso machine, weekly massages, stock options, in-house cafeteria with good food, a fridge stocked with Red Bull, etc.
Most employers offer those not to be nice but because they yield more profit: Many employees accept poorer salary and benefits in excess of the cost of the aforementioned goodies. And often those goodies, while seeming for the employees’ benefit, actually also benefit the employer. Let’s get specific:
A ping-pong or Foosball table may be there but there’s often subtle pressure to not play except during normal breaks. Even then, playing is a visible way to appear like a slacker, so the table often sits unused. Yet for the employer’s small investment in that table, it’s great PR for the company. For example, employees can brag to their friends and on best-places-to-work surveys that they work in one of those "cool" workplaces. In addition, because playing ping-pong or Foosball provide a bit of mild exercise without the employee having to leave the office, s/he quickly returns to the desk refreshed and with the additional brainpower that accrues from the increased circulation/oxygenation.
Weekly massage also yields the employer benefit in excess of the cost. Only a small percentage of employees actually get the massage yet all employees like the concept because, again, they can brag to their friends and to the surveyors about their cool job: “Yeah, we can get a free massage every week.”
The free energy drinks and espresso boost worker energy and focus at minimal cost to the employer. And when a company spends the couple hundred bucks on a fancy espresso machine rather than a $20 Mr. Coffee, more people drink coffee with that resultant increase in energy and focus.
Good food in the in-house cafeteria means shorter lunch breaks (no travel time to and from lunch) and more likelihood of employees talking shop during lunch, or taking their lunch to their desk.
Stock options, especially from start-ups, usually end up worth nothing—too few start-ups go public. The recipients tend to be overoptimistic. Sure, if the company is already public, growing, the stock price has been rising, and the company is offering you stock options at a strike price below the current price, sure. Otherwise, that’s not a negotiation item worth going to the mat for.
Benefits That Matter More
Your job description. Your happiness and success on the job are mainly affected by the extent to which you’re doing tasks you’re good at and enjoy. Sometimes, your job description is cast in stone but often it’s in putty. If you make the case that you’ll be of greater benefit to the employer with a tweaked job description, both you and the employer benefit and thus the employer may well say yes.
Whom you report to. Your boss also greatly affects your job satisfaction and, if you wish, promotability. If during the interview process, you sense that you’d like to work for a particular person or a higher-up, that’s a good time to ask. If you’re negotiating while already on the job, you might ask your target boss something like, “If you have a project on which you could use a little extra help, I’d be pleased to help out. I’ve heard great things about you as a boss.”
401k (or 403b plan if it’s a nonprofit). If the employer has such a retirement plan, it means you don’t pay income tax on the money until you retire. Not only does that allow your investment to grow tax free, (like compound interest,) when you retire, you’ll usually be in a lower tax bracket. Combined, that usually yields you big bucks and even more if the employer matches your contribution. The latter, including the amount of employer contribution is sometimes negotiable.
Telecommuting. It can be dangerous to telecommute full-time—out of sight, out of mind—but the option to telecommute a day or two a week can save you some stressful, costly, time-consuming commuting and, especially if your job is in a cube farm, provide a work environment more conducive to getting your work done without your having to put it a lot of overtime because of all the noise and chatting. Plus, you can more easily do some personal tasks during the day—of course, making up the time later?
Training. Typically, employers offer the same training budget to all employees at a given level but sometimes it's negotiable. If so, you have a good chance of getting extra training because the employer benefits from your getting it.
Your next review. Often, your first compensation review isn’t for a year. Negotiating for a review in a few months can yield an earlier pay boost, promotion, or improvement in your job description. This is a particularly good item to negotiate if the employer won't budge on salary. You might say, for example, “All right but I know you’ll be pleased with my work, so could I have an accelerated salary review in three months and if, indeed, you’re happy, we can renegotiate then?”
Pay. I left this for last because the employer gets nothing in return and often it’s not that beneficial to you. Let’s say you negotiate hard and win, say an extra $20,000. Unlike with an increased training budget or telecommuting, the employer gets nothing in exchange for paying you more. Worse, those additional dollars are taxed at your top rate: After federal and state income tax,maybe local income tax, Social Security, Medicare, and Workers Comp deductions, you’ll probably lose half of what you negotiated so hard for. (The government thanks you!) Finally, having squeezed out every last dollar, expectations for your performance may increase and you'll seem expensive compared with peers and thus stick out when deciding, in a cutback, whom to lay off.
Usually more important than those potentially negotiable items, the decision to take a job should be based primarily on whether you believe in the organization’s products or services and whether you’d feel you’d do a good job.
I read this aloud on YouTube.