Back in 1993, Mike Murray, head of Microsoft HR wrote what is one of the most famous memos on ‘the art of cutting back’ titled simply as… “Shrimp and Weenies.”
Much like now, a recession gripped the economy. Big companies were tightening their belts and Microsoft, who were worried about slowing sales and a saturated PC market, were no exception.
Microsoft had grown extravagant with its spending with Mr. Murray pointing out that “It would not be surprising to see Gucci leather jackets with an MS logo as a reward for attending a required meeting.”
In his now infamous memo, he let executives and managers know “…we fly coach class; we stay in reasonably priced hotels; we don’t ride in limos; we don’t have executive dining rooms; our office furniture is of good quality, but reasonably priced; when dining at company expense, we order weenies not shrimp.”
Amazingly enough, the memo went over extremely well. People rallied behind the changes and dove into the “weenie” mindset.
Cut to today, where companies are announcing the removal of perks formerly used to attract new talent in what has been dubbed The Great Percession.
Some of these cutbacks can be ascribed to over-hiring and over-spending during the cushy, pandemic fueled tech boom. Other cuts can be explained by onsite office perks becoming redundant.
Why should perks reflect functionality not extravagance?
Some perks serve a purpose, others are “nice to have.”
In 1993, Mike Murray had it right. Cut back on extravagance, but don’t take away functionality.
At Edenred, we help you offer competitive, functional benefits that match your budget and continue to attract top talent. And one of the strongest, no-frills benefits you can offer is the commuter benefits.
With the stroke of a pen, you can choose to allow your employees to set aside up to $300 a month in pre-tax dollars from their paycheck to take public transportation (in any form) to and from work. The best part is this pre-tax allocation saves both you and your employees a good amount of money.
Pre-tax means no tax
Because those dollars are considered pre-tax, your company could save about $40 a month on every participating employee. If 50 employees participate that’s $24,000 annually!
Setting aside these pre-tax dollars to take the train or bus to work also helps your employees save an average of $700 per year on their taxes.
This is a great example of shaving the fat in a productive and beneficial way. Most of us would elect to save money on our taxes over a benefit that may not be right for everyone.
Your company can still offer perks that make it a great place to work!
If you’ve been looking for a way to strengthen your P&L without taking away from your current employees (or lessening the attractiveness of your company to future employees), we can help. Schedule a meeting with us today and we’ll discuss our employee benefit options with you.