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Human Resources

Recruiting Staff with Creative Benefits

Faced with salary constraints or other recruitment challenges, HR leaders get resourceful about perks.
University Business, Nov 2006

Some of the 5,000 staff and faculty at the University of Arkansas consider the school's nine-deck parking garage a valuable employee benefit. Here's why: A 2,000-square-foot retail space sits on the top floor. Besides shopping at a convenience store that stocks food, beverages, toiletries, gift cards, school supplies, and an eight-foot book section of best-sellers, employees can get a car wash or an oil change, withdraw cash from an ATM, or take advantage of other outsourced services like shipping, movie rentals, dry cleaning, and one-hour photo any time of day or night, seven days a week.

What's more, a self-service information center helps people find department addresses, access directions and bus routes, purchase sports tickets, look up class schedules, and even pay tuition.

The facility opened in fall of 2005, and usage is still low, around 200 people a day, says Barbara Taylor, associate vice chancellor for Administration and Human Resources at the university. However, the goal is to boost that number to 1,000 a day.

"We're trying to grow our student population," she says, explaining that the school's administrators' goal is to increase the current number of students from 18,000 to 22,500. "In order to do that, we think we need just absolutely the best employees we can find. We happen to be in a part of the state that [houses] the corporate headquarters of Wal-Mart, Tyson Foods, and other major companies. As a result, unemployment is very, very low. The job market is pretty competitive."

Where possible, translate benefits into dollars, which clearly spell out value to employees and job seekers.

Many schools around the country are faced with the same challenge: recruiting skilled talent in a tight labor market. To make matters worse, state institutions must deal with major salary restraints that may leave them in last place in the race to recruit. Not willing to compromise on the quality of job candidates they attract, some are using creative employee benefits as the ultimate hook.

And anything goes, especially since employee populations can be quite diverse. For example, at the University of Arkansas, employees in facilities maintenance-many of whom do not speak English as their first language-have free access to English classes. HR leaders also plan on embellishing the institution's wellness benefits this fall by offering free mammograms and breast health education to more than 100 custodial workers, and by working with students in geography classes who will map out campus walking and running routes, complete with distance and elevation changes, says Taylor. The HR department's website will include these free employee resources.

Whether or not employees take advantage of these maps really doesn't matter. The key is that the availability of these kinds of perks all adds up to help boost the university's reputation as an employee-friendly company.

To be most effective when selling employment at your institution, look at the big picture. First review your total compensation package, which also includes employee rewards and noncash benefits, says Warren Kerper, principal at Mercer, a global consulting firm based in Boston. Then ask: What story does your school want to tell the marketplace? What are the key messages you want to convey? Finally, he says, "Put the right story together."

"Schools have gotten pretty sophisticated about telling folks about all the intangibles-lifestyle, cultural amenities, cost of living, and helping trailing spouses or partners find employment. That's a big issue these days," Kerper adds.

Don't discount anything. Many schools, for instance, provide lab space, assistants, or seed money for research, which are a big draw to faculty. Since status is important, he says some also create fast career tracks for high achievers.

Then post all of these benefits online. Translate them into dollars, too, so that their value is clearly spelled out to employees and job seekers.

Duke students volunteer to coach support service or entry-level employees whose children want to attend college.

One mistake some schools make is they assume that just because their salaries are competitive, they can skimp on benefits. That may have been the case years ago, but not in today's job market. Since many colleges and universities have a strong benefits package, each institution must differentiate itself.

Look down the road. What will employees need or want? Consider what the University of Wisconsin System offers its faculty and instructional staff who work nine months out of the year: They each receive 12 days of sick leave annually. And, as with many public entities, there's no limit as to the amount that can be carried over, says Susan Chamberlain, the school's assistant vice president of HR.

When employees retire, the university takes all of their unused sick days, multiplies them by eight hours per day, and then multiplies that total by their highest hourly rate of pay during their university career. That translates into a dollar amount of sick leave credits, which is placed into a credit account with the school's pension fund provider. Those virtual funds are then used to pay for health insurance premiums-which cost between $500 and $1,000 month-as long as the retiree remains on the university's health insurance program.

Retirees who were with the university for at least 15 years receive another bonus. The school matches their sick leave credit account with an additional six-and-a-half days each year, up through 24 years of service. For example, take an employee who has 30 years of service, saved 10 days of sick leave each year and earns $40 per hour. If you do the math, that comes out to almost $100,000 in sick leave credit before the match is even applied. Chamberlain says it's not unusual for employees with long careers to retire with $200,000 of sick leave credits to pay for their health care insurance.

"When people are thinking about a job or career change and they're approaching that 15-year mark, it entices them to stay," Chamberlain says. "It's [also] a real plus for recruitment purposes because it's very unique. A lot of people are concerned about paying for post-retirement health care insurance."

Sometimes, an institution doesn't need to introduce new benefits. Instead, officials can consider expanding existing ones.

Tuition assistance is a good example. The majority of Duke University (N.C.) employees who have worked there for at least five years can receive financial aid for their children who attend college, even outside the state. After they pay $1,800 per semester deductible, Duke will reimburse them up to 75 percent of the price of Duke's tuition for full-time study at any accredited college or university.

The payoff for the school is huge. People who use this benefit tend to stay at Duke for an average of seven more years than those who don't, says Clint Davidson, vice president of HR.

Employees who have worked there for at least two years also receive $5,000 a year in professional development funds. What's unusual here is there's no cap. The only restriction is after spending $2,500, an employee must commit to staying at least two more years or pay back half of the $2,500.

If those ideas don't appeal, consider this one: Ask local businesses to discount their products or services to employees by 10 percent. Duke created this program back in 1998. So far, 11,400 employees participate, with discounts currently for 350 businesses, including restaurants, department stores, restaurants, and even car dealerships.

Another Duke program is College Connection. Students, under faculty sponsorship, volunteer to meet with support service or entry-level employees whose children want to attend college. They coach them on the college admission process and how to obtain financial aid. It's a valuable, free resource, says Davidson, adding that 31 parents have participated since the program began last spring.

The school also offers a benefit-called Prospective Health-with a demonstrated return on investment. Employees were divided into three groups based on the cost of their health insurance claims and medical diagnosis. Those in the high-risk or intensive group were voluntarily connected with health care coaches who work with their doctors in developing customized diet and exercise plans, addressing preventive measures, and monitoring their prescriptions and testing. Of the 1,000 employees who currently qualify, 600 participate. So it's clearly seen as a benefit.

The program is a benefit to the school's bottom line, too. Since the program began in 2004, this group's claims costs have been reduced by $1.2 million. The average length of stay at the hospital has decreased by one day per employee per month. Likewise, hospital admissions have decreased from 305 to 105; emergency room visits dropped from 150 to 140.

"This is still a very young program," says Davidson. "All of the indicators are encouraging but the program hasn't been out there long enough yet for us to say with scientific confidence that it's all because of Prospective Health."

Any way you look at it, creative benefits act as an employee magnet. Considering today's hot job market, they could make the difference between hiring quality staff or just warm bodies.

Carol Patton, a Las Vegas-based freelance writer, specializes in covering human resources issues.