Amy Spurling, founder and CEO of the HR tech company Compt, thinks perks should be a lot less exclusive. She advocates for “personalized perks” to help all employees take care of themselves and their families.
In the vernacular of the American workplace there are “benefits” and there are “perks”. Benefits are for everyone who works for the company. These typically include health insurance (which might, or might not, come with dental), a 401k (maybe a match, maybe not), vacation time and the legal holidays. Perks, such as a corporate credit card or a car, are typically associated with the executive ranks. The Compt platform enables companies to offer personalized perks adapted for the varying needs of every member of the team, regardless if the team is in-house, remote, or hybrid.
Compt was chosen from among 150 HR tech companies as a finalist in the upcoming inaugural Society for Human Resource Management (SHRM) Better Workplaces Challenge Cup. Prior to founding Compt, Spurling held roles in finance and operations at six startups, three times as CFO and twice as COO. She was named Boston’s CFO of the Year in 2016 by Boston Business Journal.
We asked Amy Spurling about perks for all workers, including those brewing lattes and hammering nails, how to stay on the good side of the IRS, and how helping employees in ways that are genuinely helpful builds strong teams.
GD: Perhaps I am simply traumatized by the wealth gap, but “personalized perks” sounds to me like another way to pamper executives and the elite employees while ignoring the rest of the team. Am I wrong?
Amy Spurling: Personalized perks are actually the opposite. They are the way to ensure that the entire team is supported rather than just a privileged few. Instead of having a country club membership for a few, companies are looking for ways to offer perks that reach every single person on the team. That’s where stipends come into play.
GD: What is an employee perk stipend? Can you give some examples?
Amy Spurling: A stipend is a budget given to each employee (or a group of employees) where they are told you have $X to spend in particular categories. They’re also referred to as perk allowances, lifestyle spending accounts, specialty accounts, or lifestyle benefits. Companies can mix and match categories to create a pretty powerful stipend. We learned that offering companies the power to choose perk categories instead of depositing a taxable sum of money into an employee’s paycheck resulted in a more organized program, and employees were actually using the benefits.
Through Compt, companies can choose from the following categories: learning and development, health and wellness, equipment stipends, remote employee, family stipends (like child or senior care, fertility, adoption, etc.), meal plan stipends, and general perk stipends. During the pandemic we’re seeing many companies offer “Remote Work” Stipends where they give funds to employees to cover cell phones, internet, health and wellness, and even family expenses.
Q: The Trump organization is in trouble for not taxing perks it has provided high level employees (and the employees are in trouble, too). What is, and is not, a taxable perk?
Amy Spurling: The IRS has set strict guidelines as to what is and is not taxable. That compliance is a key cornerstone to why we built this platform. As the founder of Compt, I’m a three-time former CFO, so I understand that it’s critical as a company to handle these things correctly.
Things that aren’t taxable are internet/cell phone reimbursements, commuter benefits, equipment for your home office, professional development, student loan repayments. Nearly everything else is taxable – from lunch stipends to health and wellness offerings to pet insurance.
GD: Companies have complained for years about the challenges to hiring “talent”, by which they mean knowledge workers and skilled techies, such as programmers, but there are now widespread shortages of restaurant staff, daycare workers, construction workers, and retail employees, who generally have very few, if any, benefits. Are perks a possible solution for finding, hiring, and retaining those workers?
Amy Spurling: Yes! Perks aren’t just for the “knowledge workers” or those in offices. Yes, it is hard to find and hire engineers, but having 200% turnover in your coffee shop franchise is entirely more difficult. We work with companies to offer stipends to those hourly workers so that they can then receive perks that are flexible and also allow them to differentiate themselves from every other hourly place a person could work.
Looking back at Q2 of 2021, we found health and wellness is consistently the most popular perk spending category, but “health and wellness” could mean a gym membership to one person and a meditation app to another. It’s no surprise restaurant staff want different perks than daycare workers. A retail employee may want child care benefits for when they need to pick up a shift where the construction worker may want health and wellness perks to spend on a gym membership to stay fit. Companies can’t offer a Friday pizza party and expect to attract and retain employees. Personalized perks gives the power to the people to fulfill their needs, thus boosting morale and increasing retention.
GD: The option to work remotely was, not so long ago, a coveted perk but is now the ordinary employment setting for millions of workers. What perks are remote workers seeking?
Amy Spurling: Everything they had before, and then some. We ran a study on over 4,500 of our employee users (many of whom are remote) to see how many different vendors they could possibly use. The answer was shocking. In just three months they used 6,500 different vendors! Because employees are working remotely and completely dispersed, having a pass to the company gym no longer works. Companies are looking to support concepts (health and wellness, family, food, etc.) rather than specific vendors so they can reach more people. Personalization is key.
We’re seeing a trend of remote workers seeking perks like company-paid internet, cell phone allowances, technology reimbursements, and at-home office setup. In fact, cell phone and internet reimbursements were in the top five categories for employee perks for the first half of 2021 and we expect to see that trend continue.
But we’re also seeing some more interesting ways remote employees are spending their perk dollars, like with “family stipends” to cover all costs associated with the home. This goes beyond a monthly internet stipend; employees are using it for other household utilities, groceries, and even home improvement. Think about it – now that you’re working from home all day long, you start to notice how small your kitchen is and how you just can’t stand the paint color in your office.
GD: What are the most prominent trends in employee benefits and perks that you are paying attention to now?
Amy Spurling: The biggest trend is the push for perks in places that didn’t historically have them – restaurants, hotels, hospital staff, construction sites, etc. Just having life insurance and 401k isn’t going to get you the best people. People want and expect their companies to support more of their lives. The beauty of stipends is that you can empower your team to make choices for themselves, while not breaking the bank from a budget perspective. We find that most companies are not adding a net-new budget line item. They are taking funds that were essentially wasted (on things like gift cards, tchotchkes, etc) and repurposing them to be meaningful for the entire team.