Money isn’t everything: Nonfinancial rewards that retain the best workers

Competitive salaries have always attracted employees. But today’s professionals desire—and require—much more than money to stay satisfied, engaged, and loyal to their employers. As a result many companies, including accounting firms, make a point to offer employees nonfinancial perks and benefits such as career development opportunities, flex time, Fridays off, work-from-home options, tuition assistance, and even gift cards for jobs well done.

“Salaries and benefits will get you a ticket to the race by bringing people into an organization but do not allow you to win the race,” said Tom McMullen, reward practice leader at Hay Group, a division of Korn Ferry. “We find time and again that it is the nonfinancial rewards—or lack thereof—that cause people to exit an organization.”

According to a recent study by Korn Ferry Hay Group, 9 in 10 midsize-to-large organizations report that they use four or more alternative methods of rewarding employees, including career development offerings, spot cash bonuses, health and welfare benefits, gift/merchandise programs, and additional paid time off. And, over the next year, 71% of these companies plan to increase their use of unconventional rewards.

“Without a doubt, this is a growing trend at Grant Thornton,” said Erica O’Malley, CPA, and national managing partner of employee benefit plans and people experience at Grant Thornton LLP. The firm offers a “flexible time off” program, which allows employees to collaborate with their managers to decide on an ideal work schedule. These plans could mean reduced office time, or flexible schedules outside the traditional 9-to-5 schedule. Grant Thornton also allows their people to “work when and where they feel they’ll be most effective,” including from home, she said.

The same is true with Ryan LLC, an international tax services and consulting firm that now allows employees to create their own schedule and work from the office, their home, or the beach, as long as they get their work done. Since starting this program in 2008, the company’s turnover rate has plummeted from 21% in 2007 to 10.5% today, said Delta Emerson, president of Global Shared Services at the firm. “We did a 180 from being draconian to being flexible,” she said. Ryan also offers 12 paid weeks of maternity leave, two weeks of paid paternity leave, a four-week paid sabbatical every five years, tuition assistance, wellness benefits, a career-training program, and subsidies to workers’ health club memberships.

Kenneth Cerini, CPA, founder and managing partner of Cerini & Associates LLP in Bohemia, N.Y., also offers flex time and gives his employees every other Friday off during the summer, as long as they put in their hours. He pays attention to their interests and rewards them when they’ve earned it; recently, he bought a hard-to-find set of coins for a coin-collecting staff member who volunteered to help with a Saturday project. His firm also offers cash bonuses based on performance. “You’ve got to do the right things for your staff; otherwise, you won’t get them to come to begin with, and your reputation is going to precede you,” he said.

Experts offer the following tips for implementing nonfinancial rewards and perks at your workplace:

Know your people and what makes them tick. Do they value flex time? Gym memberships? Job training? “We see too many organizations saying we need to offer vision, dental, pet health insurance—but have you bothered to ask the people what they value the most?” McMullen said. Communicate with staff and conduct internal surveys to find out what staff members deem important.

Examine your professional and advancement offerings. If possible, have an upward growth path, and provide fresh opportunities that will challenge and excite your staff, Cerini said. And advancement is not just about moving upward, McMullen noted. “It is also about moving around in the organization.” This is especially true with smaller firms, which need to be more creative and nimble in how they view development, he said.

Focus on career coaching and creativity. Do this “early on, and help them define the direction they want to move within the firm,” Cerini said about coaching employees. Provide workers with a mentoring system and access to top management. And consider offering “a development or training opportunity in an area of focus” to an individual, McMullen said. “Providing a project opportunity that is of interest to the employee will make an impact on the organization and is visible to others,” he added.

Be flexible and watchful. If an idea for a new type of reward sounds harebrained, “Keep an open mind,” Emerson advised. And once the rewards are identified and in play, monitor them to see if they are effective. Use engagement surveys to gain valuable insight from staff members. Alternatively, companies can conduct thorough exit interviews. Ryan LLC also has an internal feedback portal called RyanMATTERS “that allows all current employees, real-time, to give suggestions and feedback,” Emerson said.

Don’t treat everyone equally. Employees traditionally receive promotions, bonuses, or raises at set times. But today’s savvy firms focus more heavily on performance, not tradition. Some people need to be pushed, and others outperform and deserve rewards. “Treat people the way they need to be treated,” Cerini said. “Some people need to get a little kick in the butt, but other people need the carrot.”

Put your mouth where your money is. Employees sometimes believe they are underpaid. But many companies don’t do a good job at communicating the total value of their rewards package. Tally up what you are offering each employee—including compensation, health benefits, short- and long-term incentives, and nonfinancial rewards, and provide this information annually or every other year to your staff in one-to-one or group meetings. Some organizations also use employee reward statements in their offer letters to job applicants. “If it could stop one person from leaving your organization, why in the world wouldn’t you communicate that value?” McMullen said.

Focus on culture and collaboration. Today’s professionals embrace collaboration and being appreciated and trusted. “If you can create the right environment for people, and people feel connected to where they work,” Cerini said, “they will be happier and will stay longer.”

Cheryl Meyer is a freelance writer based in California. To comment on this article, email Chris Baysden, AICPA senior manager, newsletters.