Employee engagement
Ana Gotter
January 17, 2020
10 min

When & Why You Should Offer Employee Stipends

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When & Why You Should Offer Employee Stipends

Ana Gotter
June 18, 2020
Offering Employee Stipends

We’ve never had such an extensive and widespread shutdown across the world that has so deeply impacted businesses and individuals alike. We are in the midst of a monumental global shift.

We have had to move quickly in order to adapt to new working environments, or the lack thereof. Unemployment across North America is skyrocketing, reaching between 7% - 8% in April 2020. It could be argued that we all know someone personally who has been affected by this pandemic.

While everyone is struggling, businesses who are in a position to help their staff out should try to do so. Offering employee stipends is one way to support your employees and introduce creative, scalable benefits for them while we are all working from home.

In this post, we’re going to look at when, why, and how you should offer employee stipends to your team members.


What Exactly Are Employee Stipends? 

Employee stipends are separate from an individual’s salary or standard pay. It’s an additional benefit that you offer, either regularly or under specific circumstances.

Right now, companies are offering employee stipends that they can use for anything they need, even if it’s paying their bills. During less severe economic conditions, businesses may require that stipends are used for business purposes, like a desk for your at-home office, educational training, or meals during the week. 

Either way, these funds are flexible and allow employees to prioritize spending on what they need most.


Why Should I Consider Employee Stipends? 

Employee stipends are a creative benefit for employees that won’t go unnoticed. Employers who introduce employee stipends, especially through these times, are typically some of the most coveted places to work in their fields.

Employees value businesses who value them. Giving them a flat fee that they can use as they see fit to essentially be in a better position to do great work is a powerful advantage that anyone would jump at. 

It’s worth pointing out that during times of financial or economic hardship, they put your team at ease and can make their lives significantly easier. Right now, someone could use that stipend to cover snacks or meals that are helping to feed their family, which goes a long way with kids home from school and having other household member’s income in jeopardy.

Stipends can increase productivity by boosting employee satisfaction and engagement. Satisfied employees are between 12-22% more productive than those who aren’t unhappy with their jobs, so investing more into your team can yield more direct profit in return. 

As your employees are happier and feeling more secure, this energy will be passed along to the customers they’re working with, creating a more positive experience all the way around.


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When to Consider Offering Employee Stipends 

Some businesses offer employee stipend policies on a regular basis as a standard perk for their team members. It is anticipated that remote work will be more popular in the future, so employee stipend programs are increasing in popularity.

This is something that we recommend considering, even if you’re only offering $50 to each team member every month. It’s an appealing benefit that your team will absolutely love, and using perks to keep your team happy and excited about your company will absolutely pay off long-term if you can afford to do so.

Even if your staff isn’t at risk for losing their job, consider how some people live paycheck-to-paycheck. These individuals aren’t able to stock up on extra groceries, office supplies, or medical supplies because they are no funds left over. A stipend can give them the flexibility in their budget to be prepared. 

Shopify, for example, made news in March when they offered all employees a $1,000 stipend to ease their transition from in-office work to remote work. Team members were able to use the money to buy equipment like home computers, desks, high-quality chairs, and more.

How to Implement an Employee Stipend Policy 

There are a number of different ways you can choose to implement an employee stipend program.

First, you’ll want to decide whether the stipend is a one-time occurence or an ongoing perk. You’ll also want to set guidelines of who gets the funds; all full-time workers should, and contractors typically won’t. Will part-time workers receive less than full-time workers, or will they not receive stipends at all? Keep this fair to keep your staff engaged. 

For one-time distribution, you typically have the two following options:

  • Writing a check or depositing the flat stipend fee into each employee’s account. If you want them to truly be able to purchase what they need with no limits, this is a good choice.
  • Having employees submit receipts to you for reimbursement. If you only want to allow staff to use the stipends for specific items like office equipment or even food, you can use this option. It takes more time, however, and some employees may not be able to purchase something if it takes up to a month or more to be reimbursed.

 For ongoing distribution, there are other great options available. You can still use the two methods above, but having employees constantly submitting receipts for reimbursement can become increasingly tricky to track on an ongoing basis, and it can overwhelm your HR and/or accounting departments. 

 Because of this, using a solution like Hoppier’s Flex program is a great way to go. Within our dashboard, your administrator (often an HR team member) can allocate stipend funds for each employee with restrictions. This is especially valuable when introducing a lunch program, for example, which you would restrict spending to only food delivery services such as Uber Eats and Skip The Dishes. Your team gets incredible flexibility to choose, and there’s still accountability.

 You can learn more about our program here, which works well for both in-office and remote teams.

Conclusion 

With more teams working remotely, team members and businesses alike are left scrambling. The last thing you want is your team members to be worried about food, or to be sitting at the kitchen table next to their ten year old having a video call because there’s no in-home desk that can be used.

All businesses who can afford to do so should consider implementing employee stipend programs, and using the guidelines laid out in this post can help.

Interested in setting up an effortless, easy-to-use and simple-to-manage employee stipend program for your business? Learn more about Hoppier here.


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