Why People Are No Longer Treating Full-Time Employment Like Marriage

'Til death do us part' may no longer be realistic - or healthy - for employers or for employees. The challenge is that the severing of that relationship has generally not been a mutual decision: it's been largely driven by one party to the contract. Nor have both sides shared equally from the results of the change.

If it is to work for both attracting talent and improving productivity, then innovative ways of generating benefits must be found. That may mean rethinking the portability of a once static responsibility which could attract talent while improving productivity and competitiveness. JL

Aimee Groth reports in Quartz:

Employers are “moving up Maslow’s hierarchy of needs” with perks and benefits. The fraction of pay going into benefits has been rising and wages has been falling. Perks have a way of fulfilling emotional needs that wages don’t. (But even) marriage has evolved into a partnership based on mutual trust and respect. Benefits won’t be decoupled from companies soon because of tax incentives. Increased productivity can be achieved by giving employees more trust and autonomy— the ultimate perk

Shortly after raising $100 million, online bulk-goods retailer Boxed announced that it would cover the cost of its full-time employees’ weddings up to $20,000. The offer rivals other outlandish perks in the tech industry’s war for publicity and talent—like on-site acupuncture and improv classes (Twitter), reimbursement for seeing a life coach (Asana), or a $2,000 stipend to travel the world (Airbnb). But this transaction crosses a new boundary: A US employer is playing a big part in one of the most intimate days of an employee’s life.

In a way, the gesture is symbolic of the American employer-employee relationship, which has come to resemble a marriage contract. Employers are “moving up Maslow’s hierarchy of needs” with perks and benefits, according to Glassdoor economist Andrew Chamberlain. “There’s a trend over the last decade-and-a-half to two decades in the US where the fraction of pay going into benefits has been rising and wages has been falling.” Perks have a way of fulfilling emotional needs and connecting them to an employer in the way that wages don’t.

Although some tech companies are re-evaluating their perks (Dropbox recently announced that it’s downsizing its $25,000-per-employee perk package, which included free laundry service and a shuttle service to San Francisco), they aren’t going away anytime soon. For many companies they are integral to attracting and retaining talent.

Boxed CEO Chieh Huang told Quartz that he believes the wedding offer makes the employer-employee relationship more reciprocal. It counters the expectation that “I give myself to the company, but when I’m in a hugely tough spot, the company doesn’t give itself to me,” he explains. “If you come into a tough time, we’ll do our best to help you.”

His decision to fund weddings was an emotional transaction involving an employee who was in a bind. It gave Huang an opportunity to be the hero. The gesture appears genuine, but it also created a grayer line between an employer and his employees.

It brings up some questions: What is an employer really responsible for? If an employee accepts an employer’s offer to pay for their wedding, what are the expectations of both parties going forward? Does the CEO attend the weddings? What happens to those who cannot take advantage of the perk?

Boxed’s commitment to financing holy matrimony reflects a larger trend of how employers are now managing worker well being. Beyond superfluous perks, companies are investing in the intimate details of employees’ lives, through egg freezing (Spotify), $4,000 in “baby money” (Facebook), and even gender reconstruction surgery (Accenture).

So how is an employee expected to reciprocate? Perks are ultimately incentives for employees to give more of themselves to a company. As such, there is a certain indebtedness that emerges.

“When did we as a society agree that the safety nets and structures of our health should be given by a corporation?” asks Alex Abelin, a former Google employee who recently launched online job marketplace Liquid Talent, which focuses on the gig economy. “It’s a dangerous agreement that we have where companies take care of us and that’s how we live our life.”

Abelin is among a growing subset of Americans outspoken about decoupling benefits from US companies. While benefits are different from perks, both are taken into consideration when determining salary. The danger, says Abelin, is that all of these benefits are tied to a single source. If the source is cut off, the protections are, too. “We need a better societal contract,” he says.

The US’s shift to a gig economy—filled with contract workers untethered to companies—has played a major role in forcing the question about what a company is responsible for. Workers say they want more freedom and autonomy, but company benefits are what keep many from participating in this sector of the economy. To that end, there’s a solution that’s being explored in the private sector.

“There are startups that are trying to construct portable benefits,” says Colleen Poynton, a VP at Core Innovation Capital, an early stage venture capital firm that invests in financial technology, referring to a benefits system that moves with you from employer to employer. “Technology can do a lot to replicate some of the safety net and mitigate the volatility that comes with being an hourly worker or contract labor worker.” She cites Peers as an example of a platform that is exploring portable benefits, with the caveat that the company is currently “in hibernation” because of the high obstacles in the regulatory environment.

While benefits won’t be decoupled from US companies anytime soon because of powerful tax incentives, employers should reconsider how they manage perks. The psychology behind perks is that they boost employee loyalty and motivation. But increased productivity can also be achieved by giving employees more trust and autonomy—arguably the ultimate perk—and investing the capital that would go to perks into wages instead.

“When an employer is offering a one-size-fits-all benefit to a diverse workforce, it’ll be good for some and bad for others,” says Chamberlain. “As an economist, you should just give people cash and let them decide for themselves as adults what they like best.”

OfferUp, a mobile Craigslist competitor based in Bellevue, Washington, prides itself on its lack of office perks. “If we’re finding people where those things matter, they’re probably not a fit,” says CEO Nick Huzar. “We once had an investor come into our office and say our snacks suck, I said ‘thank you.'” Huzar says that they don’t offer perks so that the company stays frugal and scrappy (although they do have a beer keg in the office). To convey that message, he requires new employees to build their own desks and chairs on their first day of work. “It’s the same thing with salaries,” he says. “We pay people well, but not like Google or Microsoft. Our focus is more on ownership.”

Keeping things simple creates a clearer distinction between the role of an employer and the worker. The institution of marriage has evolved a lot over the past few centuries into a partnership based on mutual trust and respect. It is time for the employment model to evolve as well, to a model that hinges more on trust, and commitment is not dependent upon perks. But that’s where the similarities between marriage and employment should end.