Rethinking employee wellbeing and hiring incentives in a tougher market

Years out from the post-pandemic days of “wellness menus”, onsite yoga classes and aggressive hiring incentives, power is shifting back into employers’ hands as job-seekers find it increasingly difficult to find work.  

On the job, many employers are pulling back on employee wellbeing strategies and focusing more on measuring performance and tracking attendance.

At Meta, a new performance evaluation program links an employee's "impact" to their advancement in the company and compensation.

This summer, AT&T's CEO told employees to prepare for a "more market-based culture" while telling them they had to come back to the office five days a week.

While it’s been mostly massive U.S.-based employers making recent headlines with tough “get in line or get out” type messages for employees, Zoe Kinias, associate professor of organizational behaviour and sustainability at Ivey Business School, says that higher costs and pressure to “do more with less” could mean wellbeing perks and hiring incentives are harder to justify north of the border as well. 

Kinias also warns that even without the seemingly harsh methods of employers in the U.S., the way Canadian organizations restructure their perks and incentives during economic uncertainty can still have negative consequences on employee retention and productivity.  

“The risk is to do any slashing of things without really clear communication about what's being cut, and why,” she says. 

Employer power, uncertainty and the role of middle managers 

Business Insider details a “less cuddly” white-collar workplace of late, as large U.S. employers such as Meta and AT&T link advancement  and compensation more directly to “measurable impact” than loyalty. This reflects a wider pendulum swing back toward employer power after the pandemic and the “Great Resignation,” when workers briefly held more leverage on pay, flexibility and perks.  

Kinias stresses that current uncertainty and cost-cutting measures make basic employee connection practices even more important for retention – even with more power in the equation, wellbeing should still be a priority for employers.  

This is where middle managers play a pivotal role, she says – in cases where formal wellbeing programs are being pulled back or cut, managers should be taking up the slack through what Kinias calls “textbook best-practices for connecting with employees … even brief walk-and-talks, or coffee chats with folks on the team.” 

She acknowledges that many managers feel underprepared for this aspect of their job, particularly at scale, but for strapped Canadian employers, building those skills internally could be a lesser investment compared to the cost of replacing disengaged staff in a volatile market, now and in the long-term. 

Low cost culture, communication 

Many workers are currently “job-hugging,” holding on to roles where they feel stuck and dissatisfied. In this environment, cutting wellbeing programs without transparent communication can lead to “vicious cycles” where employees have lost loyalty towards their employers and colleagues. 

“They're trying to undermine each other, there's incivility, or there's problematic behaviors at work,” Kinias says. In this context, culture and connection can be used as a cheaper tactic for employers who can’t afford expensive perk or benefits packages.  

As wellness programs and other incentives come under the microscope, Kinias stresses that communication and substitution matter as much as what gets cancelled. She adds that, at the team level, “Ask what they need and ask what supports they're looking for.” 

Maintaining flexibility  

Beyond hiring bonuses and other cash incentives, which Kinias says can be effective hiring incentives, location and schedule flexibility remain highly valued for many workers, even in a tougher job market, “Particularly for those who have any caretaking or health or wellbeing challenges, or physical challenges.” 

For employers, that can mean pairing any reduction in higher-cost perks with lower-cost options that still address wellbeing. Instead of an onsite yoga program, for instance, organizations might share access to online classes or structured mindfulness resources.  

The key is to show that wellbeing remains a priority, Kinias says – even if the specific format has to change to fit current budgets. Kinias notes she is seeing some organizations move away from broad, high-spend programs toward more targeted, specific supports for employees.  

“More than just slashing things, trying to be more targeted or more specific in the offerings that they are providing,” Kinias says. 

“To the extent that benefits do need to be trimmed back, trying to offer alternatives for it that are still helpful for people.”