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April 03, 2021

Employers continue to cut office perks

Close to 40% of employers plan to make cuts to office perquisites and benefits in the face of a shrinking economy this year.

In addition to curtailing business travel, roughly two thirds of these belt-tighteners are cutting or scaling back company social events such as picnics and holiday parties. And a further 34% expect to cut office perks such as coffee, soft drink machines, and subsidized meals.

Cisco Systems, for instance, is dropping a longstanding practice that allowed its employees to expense their home broadband service. It’s also closed its free campus gyms, replacing them with newer facilities for which employees will have to pay $20 a month.

Even Google, whose employee perks are legendary, has shaved a half-hour off the cafeteria access time during which workers can order breakfast, lunch and dinner — they still eat for free though.

Despite the resulting bottom-line improvement, companies would be better off suppressing the urge to slash employee perks, argues Jairus Ashworth of Hewitt & Associates. The savings made by eliminating these small benefits could backfire and impact employee morale, damaging the company's finances much worse than a few free coffees, he maintains. 

The emotional backlash can be extreme, he says, particularly as the working environment has become such an important piece of the total rewards offering for most companies.

While job security is clearly everyone’s top priority these days, it’s the threatened loss of the smaller stuff — a health club on premises, flex hours, tuition support or even help with transportation costs — that really get's people going, laments one recent corporate refugee.  

So, is your employer cutting back? Tell us how.



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Gordon PowersGordon Powers

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