Great talent is getting harder and harder to attract, retain and engage. The perfect solution for that is lifestyle benefits - benefits that support employees' whole selves and whole lives beyond a paycheck.
Lifestyle benefits have emerged as one of the biggest focus areas for people operations leaders today. We'll dive into all of their advantages later in this guide, but to put it simply - it's because the basic benefits that companies have been offering up until now just aren't cutting it anymore.
What used to be unique lifestyle benefits (also sometimes called perks) - things like unlimited coffee, free food and the ability to work remote - are now so standard that current and prospective employees of your organization aren't going to be very impressed if that's all you've got.
With lifestyle benefits, your company can unlock a truly personalized experience for your employees' diverse needs so that they can actually feel supported and happy to be working at your company, whether your team is fully remote, in a hybrid model, or going back to the office.
Here's what is covered in this guide:
First, a definition:
Lifestyle benefits, sometimes referred to as employee perks or employee lifestyle perks, are non-salary benefits given to employees to improve their overall lifestyle and which go above and beyond standard medical, dental and vision benefits.
Moden companies turn to lifestyle benefits to broaden employee access to goods and services that improve all areas of their lives, including mentally, physically, psychologically and financially.
The categories employee lifestyle benefits can cover include:
Lifestyle benefits are rapidly becoming the future of employee benefits. Here are several strong reasons to support that fact, which represent the advantages of offering a lifestyle benefits program:
Most companies already offer competitive compensation ranges and standard benefits like PTO and medical, dental and vision benefits, and at the same time, the competition to attract, hire AND retain quality talent has increased significantly.
Offering lifestyle benefits has emerged as a powerful way for employers to differentiate themselves in a crowded hiring market while allowing them to stay true to themselves.
Even companies with very generous overall benefits packages can suffer from low employee engagement and productivity, and the massive shift to remote work that we’ve all experienced this year has proven that.
Offering employee lifestyle benefits that are customized to your people’s unique needs is hugely beneficial for companies wanting to increase employee engagement and retention in this current climate and in the long-term as workplace conditions evolve.
Now more than ever companies have the responsibility to not only prioritize creating diverse and inclusive workplaces, they also have to put action behind those intentions.
Lifestyle benefits can be designed in way that addresses all of the needs of your diverse workforce, whether that means supporting an employee who’s a 22-year-old recent graduate who lives in the city with a cat, or a 55-year-old executive with three kids and a home in the suburbs. Lifestyle benefits, particularly in the form of flexible perk stipends, are ideal for that type of personalization and inclusivity.
There are many reasons you might not want to or be able to offer a pay increase to employees. When increasing their compensation isn’t an option, offering meaningful lifestyle benefits can be powerfully effective in making them feel supported - sometimes even moreso than a simple pay bump - while also being very cost-effective for you, especially if you use a lifestyle benefits platform like Compt to reduce the administrative burden.
This trend towards expanded and unique employee lifestyle perks and benefits - and away from the cookie-cutter basic benefits packages - has been a long time in coming. Employees have been wanting for more for years.
Even before the pandemic, studies showed that about 60% of people considered benefits and perks to be a major factor when deciding to accept a job offer and 80% of employees would choose additional benefits over a pay raise.
Now is the perfect time to re-evaluate and revamp your outdated perks programs to better suit your employees lifestyle needs today. And speaking of the now, here's a helpful resource about why your remote employees need support like your on-site team members.
Input some basic data into our Perks Vendor Cost Calculator to identify how much you're spending on all of your vendors, and how much you can save by consolidating with Compt.
The list of companies offering flexible and inclusive lifestyle benefits is ever-growing, but here are a handful that stand out as great examples:
Google introduced a $1,000 work from home stipend to help support their employees’ remote work lifestyle during the pandemic (and so have other tech leaders like Facebook. Twitter, Shopify). And that was in addition to the many other lifestyle benefits Google already offered to all of their employees across its many locations, from $500 in “baby bonding bucks” for new parents to massage credits and free fitness classes.
Starbucks has long been known to offer great benefits for its employees, and one example of a lifestyle benefit they offer is a $500-$1,000 tuition reimbursement benefit for their employees.
Employees of Deloitte have the benefit of personalizing what health and wellness means to them through an annual well-being stipend of $500.
Eventbrite supports their employee health lifestyle choices by offering a monthly $60 wellness stipend as a lifestyle benefit, which employees can use on anything from gym dues to juice cleanses. They also introduced a home office stipend after the pandemic.
Takes lifestyle benefits to a new level by leveraging the power of stipends: they have a $1,200 annual wellness benefit (to use on massages or other physical therapy), a $300 annual wellness benefit on top of that, and $100 monthly wellness benefit to put towards gym memberships, classes, etc.
LinkedIn - which knows a thing or two about the workplace - offers some great lifestyle benefits to its U.S. and Canadian employees, which include an annual $5,000 stipend for professional development related to their job and a $1,800 wellness allowance. And in response to the pandemic, they’ve also introduced additional stipends to support working from home.
Great Place to Work, a true leader and authority in workplace culture, rolls up all of the possible categories of lifestyle benefits and makes them eligible for their employees in one flexible stipend called CARE4U. With this lifestyle benefit, which works as a flexible perk stipend, their employees have a $5,000 annual stipend to spend on whatever they need across
There are many more examples of companies doing this successfully. If you want to hear what our customers are doing, click here to talk with a Compt lifestyle benefits specialist.
Download the free ebook to find out why lifestyle stipends have become the most common new benefit.
There are a number of ways you can offer lifestyle benefits. You actually might already be offering some sort of lifestyle benefit that can easily be turned into a more thought-out lifestyle benefits program. Some things that fall into this category are a professional development stipend, a gym membership reimbursement or free meals and snacks.
But regardless of whether you offer any of the above or have offered any type of lifestyle benefits before, getting started is easy. Here are two main ways to offer them:
Like the examples listed above like Starbucks and their Tuition Reimbursement program, or Eventbrite’s Wellness Stipend, you can identify specific categories you'd like to build benefits around in your company and focus your efforts on those one at a time.
This is something that many companies who have shifted to remote work indefinitely have already done using stipends: they've set up their lifestyle benefits through category-specific stipends such as a health and wellness stipend, a learning and development stipend, and meal plan and grocery stipends.
This is a snapshot of what Webflow's health & wellness lifestyle stipend benefits look like with Compt. Click here to talk with a Compt lifestyle benefits specialist to learn more.
If you have several areas of employee needs that you'd like to cover with lifestyle benefits but don't want the complication of managing multiple benefit vendors, your best bet is to set up all-encompassing lifestyle stipends that apply to the spending categories that matter to you. That could include anything from the ones mentioned above as well as family, pets, charitable giving, travel, internet / cellphone, work-from-home equipment and more.
Doing your lifestyle benefits this way allows you to cover the gamut of needs, situations, and preferences of your people. As a people operations professional, you know firsthand that what someone needs today might be different within the next month, and will likely be different within the next year. This approach allows your lifestyle benefits to evolve with your people.
Here at Compt, most of our customers who set up lifestyle benefits with our stipend software select one or more items from the following broad-based categories for their employees to spend in.
The broad-based categories is a deliberate approach to lifestyle benefits. With a broad-based approach, you're able to avoid having to keep track of of vendors and initiatives and instead give your employees autonomy of choice.
If you're more familiar with a vendor-based approach and need some convincing, here is a helpful Perks Vendor Cost Calculator to see what a difference going vendor-less makes.
We're here to talk through your company's current goals and challenges with attracting, retaining and engaging your employees through benefits. Let's connect to see how Compt can fit your needs.