The ‘second home allowance’ and other fringe benefits that MPs receive have been making the news headlines on a daily basis over the last few weeks. The Prime Minister himself has made a public apology and the system of allowances and perks is now under review. It seems like a crackdown on these benefits is inevitable – if only to prevent more embarrassing revelations. So do perks and benefits make a difference to how people see their jobs – and in particular, do they make a difference to how hard people work? If so, the baby may be on its way out with the bath water!
The government are not alone however, as British Airways (BA) recently made the news by putting forward 32 cost-saving proposals, many of which were about reducing staff benefits. The proposals apparently include cutting annual leave by two days and decreasing the number of night’s layover in foreign cities. Obviously, BA staff are likely to resist these changes, but the company seems to be signalling a belief that such benefits are not particularly important in motivating staff or driving overall performance.
Perhaps management in many organisations now feel that such benefits are just not affordable any more – and only have a marginal impact anyway. Or perhaps, they feel that they might be of some importance when people are considering a new job but that once in the role people just become accustomed to the benefits and they lose their motivational impact. Another view is that they start to see perks as something that they are actually entitled to rather than being discretionary – this would mean considerable affront if these things were suddenly removed. So setting aside bonuses and other direct financial rewards, do benefits serve a long-term motivating purpose or are they something that we can easily dispense with when times are tough? Both the government and BA may soon get emphatic answers to these questions from their respective workforces!
