How a Creative Approach to Benefits Can Build Huge Employee Loyalty

By Ann Rhodes with Nancy Shepherdson

Benefits are there to benefit your employees. When an employee really needs something that is not included in benefits, sometimes it’s okay and important to be flexible.

At Doubletree, for example, we had a rule that the health plan wouldn’t cover in vitro fertilization. However, I decided to waive that rule when an employee came to me and made the case that the procedure was the only way she would be able to have children. There’s a boy out there (8 years-old as I write this) who thanks me every time he sees me.

In another case, at Southwest, we had a pilot who crashed his glider into a mountain on a weekend and quickly used up his maximum health benefits on his massive injuries. In that case, we waived the maximum and paid his medical bills. And at JetBlue, an employee had a child with leukemia and needed to be in Boston for 90 days. So we gave him 90 days’ paid vacation.

Why you should think creatively about benefits

In all these cases we were self-funded and able to do these things. There are options for doing this even if you are not self-funded, if you are creative and caring. However, many companies would never even consider this because “if I do it for Joe, I have to do it for Mary.”

Well, yes, if Mary’s kid gets that sick, we’ll give her the vacation time, too. This kind of flexibility around benefits builds huge loyalty and is well worth the cost. Companies who live their values commonly do this almost without thinking because it’s just the right thing to do.

Undoubtedly, your organization already offers competitive benefits or you wouldn’t be worried about peak performance — you would just be struggling to attract some good employees. However, I want to encourage you to think more creatively about benefits, because it makes such a difference in results.

What I’m talking about goes far beyond fattening the medical benefit or giving more vacation. In fact, the benefits that employees value the most are sometimes the least costly, much less than traditional health and welfare: the opportunity to work at home, education completion benefits, sabbaticals, adoption assistance, pet insurance, and more.

Many of these programs are simple to implement, have limited costs, and will be immediately popular, such as work-at-home opportunities and free tickets to events. Others, including such items as job sharing, may require enhanced communication and education to achieve their potential for motivation but may then be strong contributors.

For an idea-starting list of nontraditional benefits that have been appreciated by top employees at our client organizations, see the Nontraditional Benefits Chart in the Leader’s Toolbox section of the book.

Nontraditional benefits: the least costly and tied to company values

If you already offer some nontraditional benefits, assess the utilization levels for these programs. Do some of the programs suffer from low utilization? If so, figure out whether it is because of lack of interest or lack of understanding or knowledge of the program. Then it’s critical you take a look at whether your nontraditional benefits support your core values and thus have a reason for being.

Meaningless, low-utilization benefits can be dropped immediately, without worry. Other nontraditional benefits, when tied to company values and com- municated clearly, are likely to be wildly popular. You should be happy about this, since nontraditional benefits are often the least costly to the organization and usually just need a mind-set adjustment on the part of senior management in order to be successfully implemented.

Early on, JetBlue gave reservation agents the choice to work from home, and in so doing created an incredibly loyal and hardworking work group. Many executives find it difficult to believe that employees can deliver top-notch work without direct supervision. What did work-at-home add to costs and supervisory duties? Almost nothing. What did it add to mistakes and customer complaints? Less than nothing. Customer service ratings actually improved.

It was a bit more challenging to let flight attendants share a job. We train both of the sharers and don’t care who shows up to work. However, they do both have to make it through the behavior-based interview. We had one flight attendant who brought in three different candidates who didn’t make it. So we carefully explained to her what to look for in a candidate. She brought in her son and they share a job now. And neither of them is interested in leaving us. We also have 30 teams of two police and fire employees who share one job. They make great flight attendants!

The big upside to PTO banks

Another nontraditional benefit with a lot of upside is paid-time-off (PTO) banks. About one-third of organizations in the United States have already replaced traditional holidays, vacations, and sick time with PTO, particularly those that operate 24 hours a day, 365 days a year. PTO simplifies time-off benefits for everyone because all days off go into one bucket that the employee can use as needed.

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At places like Doubletree Hotels and JetBlue, supervisors no longer care whether the employee needs a mental health day or needs to care for a sick child. PTO gives employees added incentive to use their paid time off wisely and creates a sense of shared accountability. Employees can use their time off as they need to or “save” for long trips abroad by avoiding tak- ing time off. Companies open for business on holidays may even save money by treating holidays simply as days that need to be paid out of PTO versus the traditional time-and-a-half premium typically paid.

Many organizations also use nontraditional benefits as an oppor- tunity to give their employees an experience specific to their business. For example, airlines provide flight benefits to employees; hotels provide room, food, and beverage discounts at properties throughout their sys- tems; consumer products firms provide discounts and sample products. Create a contest to allow your employees to suggest the nontraditional benefit they want most. Their responses will give you a clear idea of what might be missing from your current benefits offerings.

It is critically important that we think about benefits on an individual basis. Benefits can be motivational if designed fairly, but “fairly” emphatically does not mean equally. We want our “A” Players to know that we will consider anything they need if it helps them do their jobs better.

Flexibility is a critical factor

Anything? Yes. I could have said, “Yes, within reason.” But you can’t automatically limit your responses when it comes to retaining your best people at all levels of the organization. How much value will you be missing, over time, if that person leaves for an opportunity that fits better?

That’s how flexible you have to be. Your people must have the authority to make decisions based on the concept of retaining the “A” Players, not because “that’s not the way we do benefits.”

As a matter of fact, flexible benefits often directly reflect the Values Blueprint. If anything is on the Blueprint that translates, directly or indirectly, into “we value our people,” flexible benefits should be a no-brainer. Your Blueprint provides the information you need to develop a nontraditional approach to benefits.

How can your benefits offerings be modified to reflect the behaviors you want to reinforce? You can probably drop some benefits, too, particularly those your listening tour told you are not partic- ularly valued by employees. Basic benefits, on the other hand, may need to be beefed up to attract and hold “A” Players.

Your efforts to implement nontraditional benefits programs will fall short of expectations if basic needs for benefits like affordable medical coverage and adequate days of leave time are not being met. Sometimes it is simply a lack of information or understanding that causes employees to undervalue benefits.

Reprinted by permission of the publisher, John Wiley & Sons, Inc., from Built on Values by Ann Rhoades. Copyright (c) 2011 by Ann Rhoades and Nancy Shepherdson. All rights reserved.

Ann Rhoades is the president and founder of People Ink, a New Mexico-based company that helps companies create legacy cultures that treat people fairly, build loyalty, and produce solid profitability. An experienced HR expert, Ann has served as the Chief People Officer of Southwest Airlines, Promus Hotel Company (Doubletree Hotel, Homewood Suites, Embassy Suites, and Hampton Inn brands), and JetBlue Airways.

Contact her at


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