When it comes to keeping good employees, salary isn’t the only thing that matters
For Brian Quint of Seattle-based Aqua Quip, the regional labor pool has talent, high expectations and plenty of options. Washington state, after all, is home to global juggernauts like Microsoft, Starbucks and Amazon, all of which are famous for generous benefits packages and employee-centric work cultures. But if Quint’s company sells hot tubs, swim spas, pools and fireplaces, why on Earth would he be competing with coffee barons, software magnates and online retail tycoons?
Quint says that when it comes to satisfying the expectations of employees worth hiring, “the tone has been set within the community.”
A Job-Seeker’s Market, and a Hypothetical Dinner Conversation In 2017, the Society for Human Resources Management (SHRM) released a comprehensive report titled “Remaining Competitive in a Challenging Talent Marketplace.”
Its findings reflect the title of the study. More than two out of three businesses — a full 68 percent — had difficulties in recruiting during the past year. Forty percent of workers say they plan to look for new jobs in the near future. The No. 1 reason, not surprisingly, is the pursuit of higher wages. The second reason is to chase better benefits.
This trend could be especially problematic for the pool and spa industry, which is often viewed as a job by a generation hunting for careers — and nothing says good career like good benefits.
“When my prospective employees are out to dinner with neighbors who work for Microsoft, and those neighbors start talking about their benefits, we’re in direct competition with Microsoft during that dinner,” Quint says. “We’d better be mindful about what the best companies are doing for their workforces. We used to look at what the other pool company across town was doing, but we can’t scrap for employees like that anymore.”
Real-world trends seem to echo Quint’s sentiments.
According to SHRM, one in three businesses last year responded to recruiting issues by expanding their benefits packages. Virtually no companies reduced benefits, and those that did were far more likely to be large corporations with thousands of employees.
Create Benefits for the Employees You Already Have In most company staff photos, the CEO is front and center. On the website for Montana-based Mountain Hot Tub, however, co-owner and president Kelly King is far off to the side, his face nearly out of the frame.
His employees literally take center stage — but not just in a company snapshot. For him, benefits exist not to attract future candidates, but also to improve the lives of the people who already show up to work every day.
“That’s putting the cart before the horse,” King says when asked about using benefits to attract good applicants. “I put the benefits in place to take care of the employees we already have. The bigger picture is that if we take really good care of our existing employees, they’re the ones who get the word out that this is a great place to work.”
Health and Wellness: The Ultimate Benefit According to SHRM, health insurance is the benefit workers want above all others and the one that employers spend the most to provide. The report also confirmed what many businesses have learned on their own — that when companies make small, upfront investments in wellness programs, they often wind up with more productive workers who are cheaper to insure.
“One, it’s the right thing to do for your employees,” Quint says of modern wellness programs, “to encourage them to do basic things like selecting a physician before something happens instead of walking into an urgent care when something goes wrong. Selfishly, the other avenue is that if employees do go in and select a physician, get preventative checkups, quit smoking, go to the gym, they’re not going to call in sick as often or get hurt on the job as much and their absenteeism and sick days will be reduced. Eventually, so will their insurance costs.”
Quint’s concepts are reflected in the SHRM report, where nearly nine out of 10 employers considered their wellness programs to be either somewhat or very effective at reducing their overall health care costs.
King, who buys his employees gym memberships, agrees that good benefits must start with a good health plan.
“We’re really generous with medical,” he says. “We pay most of their premiums and half their families’ premiums — and we donate to their HSA every month.”
King is referring to health savings accounts, which allow employees to save money on a pre-tax basis to pay for medical costs that insurance doesn’t cover.
Quint, too, utilizes HSAs to give employees a comfortable cushion for medical expenses.
“For every $750 that an employee puts into an HSA, we match it with an employer contribution,” he says. “So they have $1,500 over the course of a year to spend on prescription drugs or whatever comes up. And it’s their money, even if they leave our company.”
Quint also uses HSAs to incentivize full participation. When employees take even basic steps like choosing a physician or getting a physical, he pads their HSA accounts with extra dollars. In 2018, he’ll begin offering extra HSA contributions — along with free devices like Fitbit wearables — to reward employees who take part in biometric screenings. Those screenings will be available, along with free flu shots, in a trailer that pulls up to the building.
“What we’re trying to do is reward good behavior instead of penalizing bad behavior,” Quint says.
Nothing Says ‘Career’ Like a Retirement Plan According to the SHRM report, 401(k)-based retirement plans have become the rule, not the exception. For businesses to stay competitive, they have to get creative.
Mountain Hot Tubs matches the 401(k) contributions of its employees, but it doesn’t stop there. As a “safe harbor” company, Mountain commits to providing contributions that are fully vested.
The big differentiator, however, came when King made automatic 401(k) contributions the default setting.
“Over the last few years, we’ve done profit sharing, which sets them up with a 401(k) whether they have it or not,” King says.
Quint, too, has achieved huge leaps in participation by switching from an opt-in program to an opt-out plan. Unless they choose to opt out, new hires automatically contribute to their savings.
“That increased our 401(k) contribution by almost double,” Quint says.
Seasonal and Part-Time Help: The Benefits Gray Zone The industry’s reliance on part-time and seasonal labor gives creative business owners a chance to get imaginative with human resources.
“This is a huge opportunity to change corporate culture,” King says. “Our part-time employees get the same benefits — 401(k), health care, holidays, all the same — because they’re just as valuable to the operation as anyone else.”
Since his part-time staff is more likely to be juggling second jobs, King offers them a coveted benefit that provides real value but costs nothing: flexible scheduling.
“We get the benefit of great employees; they get the benefit of a flexible schedule,” he says.
Quint uses benefits to reduce the slow, steady bleed of seasonal turnover, which forces so many in the industry to train and onboard new, unfamiliar workers every year.
“A second-year summer employee is way more productive,” Quint says. “We love getting second-year summer employees back. We know them. They know us. They know the job and what’s involved.”
Since Quint’s seasonal help consists of mostly college students, he appeals to their financial realities. After employees work their first summer, he mails a $500 check directly to their college registrar’s office. For every year they return after that, the contribution becomes $1,000.
“We get enhanced productivity, they get a financial reward,” Quint says.
An Employee-Centric Culture is Still the Best Benefit The Mountain Hot Tub staff photo mentioned before was taken at a company meeting — yet everyone seems to be enjoying themselves. Instead of a formal sit-down in a conference room with PowerPoint presentations, King rented out an historic theater, went over some company business up front and then treated the staff to an inspirational movie about a local customer who conquered a Himalayan mountain. Afterward, the actual climber held a Q&A.
“It’s that type of thing that makes our employees want to come to work,” says King, who stocks Gatorade, frozen burritos and snacks so his service crews don’t have to buy food when they’re out on calls. “It’s the small things that really hit home. A big part of my job is paying attention to the individual employees, and I’ve found it’s the little things that make the biggest difference.”
In terms of turnover, King says his efforts have “changed everything.”
King recalled helping employees with down payments for their first homes, with covering medical expenses and paying for a vacation.
These are the benefits, according to King, that cost the least and have the most impact.
“You could give an employee a $1 raise and they may hardly notice,” he says. “Give that same employee $2,000 to pay the closing costs on their house, and they’ll remember that their whole life. When there’s an opportunity to help them with their lives, those are the benefits that are going to make a really loyal, dedicated, long-term employee — and they’re the least expensive.”