Physical therapist Jessica Chiovaro faced an unexpected pair of potentially sticky — and expensive — circumstances last summer when the air conditioning in her home and car conked out the same week.
Despite the triple-digit desert heat and double whammy of impending repair costs, Chiovaro didn’t sweat it, thanks in part to her employer, Matt Smith, who offers a quarterly bonus program for his 150 employees at Matt Smith Physical Therapy.
Based on eight benchmarks that determine how each of Smith’s 13 clinics is performing, the bonus program was founded three years ago in the wake of the recession as a financial incentive to boost company profitability, Smith said. Every employee, from support staff to clinicians, is eligible, including Chiovaro, who joined the practice six years ago and is clinic manager and director of clinical compliance for the Nellis Boulevard location.
“Luckily, my office had received a bonus the week before, so the situation wasn’t nearly as stressful as it could have been,” Chiovaro said. “The bonus program really shows how much Matt supports his employees and incentivizes them by creating an atmosphere of teamwork and motivation and by making financial rewards tangible.”
And the bonuses can be serious folding money, not just pocket change. Employees can earn 10 percent to more than 50 percent of their quarterly salary in a single bonus.
“Because raises are discretionary at this time, the bonus program was implemented to give every employee a much larger opportunity and a piece of the pie,” Smith said.
Smith is among a growing number of employers who are finding alternatives to traditional raises to attract and retain employees.
Frank Gatski, CEO of the 53-person Gatski Commercial Real Estate Services, said his company was hit hard by the recession. But he has found ways to do more with less, such as hosting an annual “Franksgiving” event and holding an employee raffle for a weekend staycation at Mandalay Bay.
Even so, unlike some employers, Gatski has continued to give annual cost-of-living raises. He also offers bonuses for employees who demonstrate extra effort on special projects, promotes from within and takes a generous approach to vacation time and holidays.
“We have all bankers’ holidays off, and we’ll use any excuse for a potluck and an early out,” said Gatski, who in 2012 also created a profit-sharing plan. “Every quarter, I take 5 percent of profits and give it back to employees who have been here at least a year, based on seniority. It’s just a little something extra for my team, which as a business owner, is my No. 1 commodity.”
But Gatski’s policies may be the exception rather than the rule, as many companies have frozen wages, suspended benefits and reduced workforces since 2008.
Still, as the pendulum swings — albeit slowly — toward recovery, there may be some encouraging news on the horizon for employees.
In September, a survey of 910 U.S. companies by global professional services firm Towers Watson found that most employers were planning to give workers modest raises this year. And in USA Today’s quarterly economic survey of the nation’s 40 top economists, the majority predicted conservative wage gains.
Among those polled, Robert Mellman, of JPMorgan Chase, forecast pay increases of about 2.2 percent this year, and Scott Anderson, chief economist at Bank of the West, anticipated increases close to 3 percent. Anderson said pay bumps could help sustain recovery.
“This is kind of the final piece of the puzzle for the consumer,” Anderson said.
The Las Vegas Valley’s economic climate also is improving, said Brian Gordon, a principal with local research firm Applied Analysis.
Gordon said increased stability in the average number of hours employees are working is a sign that the economy is on the mend, even as business owners and managers continue to develop creative incentives other than pay hikes.
Ryan Kennelly, an economic analyst at UNLV’s Center for Business and Economic Research, said perks such as flex-time, generous vacation packages and cool company events may be the result of business owners seeing the success of other employee-friendly companies, such as Google, Amazon and Zappos.
“There are many studies that show that happier employees are more productive, not that that should surprise anyone,” Kennelly said. “Some increased health care benefits are being forced upon employers via the Affordable Care Act, (and giving bonuses) allows businesses to pay their employees more without the commitment of a full-on wage increase.”
Jeff Grace, president and CEO of IT company NetEffect, reinstated a 3 percent matching 401(k) plan in April as market conditions improved.
“With the market volatility and uncertainty of the recession, I have only recently felt comfortable enough with the company finances to do so, but it has been high on my list for selfish reasons, because I’m worried about my own retirement,” said Grace, who has been unable to offer his 16 employees raises but uses a bonus program to help keep employees motivated. “Nobody likes to go for years without a pay raise, so we have a quarterly bonus program based on company profitability. It could be anywhere from a couple hundred dollars to a couple of thousand, depending on the quarter and the responsibility of the individual.”
Rick Harris, founding partner of the Richard Harris Law Firm, offers a combination of financial incentives and perks to his 70 employees. Harris gives cost-of-living and merit raises, and employees are eligible for bonuses of four to eight weeks’ pay if the firm meets its year-end financial goals.
Employees get 15 days of annual sick and personal time and 11 paid holidays. Staff meetings sometimes are conducted over happy hour, and Harris offers telecommuting opportunities as well as flex-time from Memorial Day to Labor Day so employees can take Friday afternoons off.
Last year, Harris introduced the Your Connections programs, a free membership program for employees that offers discounts for such items as “pizza to movies to Disney World,” Harris said.
“My employees are hardworking and smart, and they deserve an ongoing thank-you,” he said. “We pay well, but for most people, it’s not just about the money. They want stability and appreciation. I’ve learned that if I don’t thank my employees frequently, they’ll find another boss who will, so I do what I need to do to keep them happy and on my team.”