Giving Them What They Want

Inc. Magazine
May 2000

Once a quarter A.J. Wasserstein gets to work early with doughnuts and bagels and makes himself available to his 45 employees for what he calls "the breakfast club." Any of the people who work at his records-storage company, ArchivesOne (#78), in Watertown, Conn., can come in and chat with the boss. That's how he found out what his employees really thought of the company's health-insurance program. "Our health-care program used to suck," Wasserstein says. "And someone made me aware of it."

His employees, it turns out, wanted an HMO-type plan that would be easier to use than the fee-for-service plan that Wasserstein had picked out. "There was an overwhelming desire from people to have a program that provided a health-plan card," says Wasserstein. "They wanted to go to the doctor or pharmacy and whip out a card." No paperwork, no deductible. "Don't make me pay $500 for a deductible," one employee told him, "because I'll never have $500."

So Wasserstein changed health plans. No big deal -- he likes tinkering with benefits and pay. Just like the government, Wasserstein says, he tries to do a little social engineering from time to time. Every month, for instance, he gives out $50 gift certificates as prizes in different, unpredictable categories: for the employee who pulled the most orders or the driver who made the most deliveries. They're a bit of recognition for excelling at jobs that, Wasserstein admits, are often boring and repetitious. Warehouse employee Eddie Santiago says he's worked at companies where "you get a smile if you're lucky. Here, they let you know when you've done a good job."

Nevertheless, employee turnover is a recurring problem. "Someone who works for us 12 months, that's a winner," Wasserstein says. Santiago, for instance, is actually on his second stint at ArchivesOne. He quit the first time after a disagreement with another employee and recently returned through a temp agency. "Eddie drifts in and out -- that's OK," says Wasserstein. "We've brought some stability to his life."

Still, Wasserstein tries to slow down the departures with a "Pay to Stay" bonus: $100 for every six months of continuous employment. "To the extent that you can defer departures, and the deferment costs only $100, you're ahead of the game, because turnover is expensive," he says. Another new benefit may help cut turnover: thanks to a Connecticut program, ArchivesOne may be eligible for $25,000 to lend or give to employees to help them buy their first home. If the grant comes through, the company could lend a worker money for a down payment at 2% interest and no principal payments for five years. If the person is still employed by ArchivesOne after five years, the loan will be forgiven.