Sometimes the light goes on at the oddest times.
Amy Spurling, CEO of Compt, was trying to offer employees at her former company a perk – gourmet coffee. When deciding what to offer she thought about people who would prefer tea. And what about those that didn’t want either? And how could she possibly personalize this benefit for her employees? That’s when the light went off.
“Employers have been providing benefits that they thought employees would like from food to sports activities at work,” she explains. “But when you look at the numbers, the participation rate is very low, around 5%-7%. Why? It’s because these perks are not really meaningful to employees.”
So, she created Compt, which provides a stipends platform that is able to transform “outdated perk programs into lifestyle support programs.” Spurling, a five-time CFO and COO, says this platform addresses the underlying needs of employees and relieves employers of the burden of guessing what benefits will work.
“Companies are looking for the highest utilization of benefits possible to show efficacy within their organization, and with this method, companies see on average 90% employee engagement with their stipends,” notes Spurling.
“Companies that hadn't jumped on the trend of these now-outdated perks, such as manufacturing, can leap ahead to meaningful benefits that are personalized,” she says. Her company works with a variety of manufacturers including railroad, agriculture and health care production.
Types of Flexible Benefits
One of the hardest parts of choosing benefits is determining which ones would gain participation. Compt solves this problem by offering benefits across a wide variety of categories and letting employees use their stipend to choose their own benefits. “What is interesting is that within these categories employees come up with ideas on how to use the money that would have never occurred to HR departments, but are so meaningful to the employee,” says Spurling.
Here is an example of some of the more popular categories.
- Health and Fitness – This can be used for in-home gyms, healthier food as well as pay for mental health apps.
- Remote Work – Funds can be allocated to outfit a home office with ergonomic equipment, or upgrade equipment.
- Family – This category can cover daycare to self-care in order to be better parents or caretakers.
- Learning and Development – Employees can upskill through either a full-time academic program such as an MBA, or a weekend executive program. Other options include online learning.
Measuring Success
“It’s the freedom of choice that builds a stronger, more trusting relationship between the employer and the employee that ends up showing up in increased retention,” says Spurling.
She notes that these benefits are also a way for companies to differentiate themselves thus helping them attract incredible talent and retain the people they have. “In times of dispersed teams, this benefit is particularly important,” says Spurling. “It can support global teams, and carries a low administrative burden."
How the Process Works
The software accommodates a variety of customized choices, provides payroll reimbursement and is IRS compliant. It’s an easy system for HR to manage as they no longer need to pick, pilot, purchase, manage and maintain each individual perk. Reports make it easy for HR to see the utilization rates of the perks so adjustments can be made.
An example of how the system works is that an employee is allocated a stipend of $100 per month to spend in the following perk categories: continuous learning, health & wellness, and food. The employee, in this case, purchased books, a gym membership and paid for lunch with her team. Other common categories include student loan repayment, travel, tech and cell phone payment.
A Benefit for All
One distinct advantage of this system is that by design it is very inclusive. Many employees might not want to use the traditional gym, or childcare benefits and feel that they are excluded from perks. Allowing employees to choose their own benefits creates a culture of inclusion and supports employees in a meaningful way. It is also beneficial to the organization.
“Offering this diversity of benefits can help a company better align its mission, vision, values and goals,” says Spurling. “This, in turn, will help attract a diverse workforce."