
On Perks - mr_tyzic
https://medium.com/@byrnehobart/every-day-companies-around-the-world-execute-a-low-risk-high-return-arbitrage-they-buy-the-time-9be6e1c1d486
======
superice
In the Netherlands, meals and other benefits provided by the employer are
taxed into oblivion after a certain amount. It makes a lot of financial sense
to just give your employees more money here and let them buy their own stuff
after income tax. The way it works is that a company can spend 1.2% of the
yearly income on the employee in terms of coffee, company retreats, free
lunches, whatever they please, but over that you pay a huge tax rate which
make the expense slightly higher than an employee buying it themselves after
income tax. Some things are exempt from this, such as free fruit.

In practice this means that the cheaper things, such as coffee and tea are
usually free (at least in offices with white collar workers) and the more
expensive things such as dinner are usually not employer provided. Company
provided lunch does exist, and seems to be on the rise, but due to the spartan
nature of Dutch lunch, companies are usually able to squeeze that in the 1.2%
given that the yearly salaries are high enough. It seems to me that all of
this is quite a nice compromise between employers running your life and you
thus being limited in your choices, while still offering free coffee and the
like.

Edit: misremembered the amount, changed 1.8 to 1.2%

~~~
winter_blue
> spartan nature of Dutch lunch

I just ran some numbers. The average salary of Dutch Software Engineer is
€42,993[1]. 1.2% of €42,993 = €516.

There are 261 weekdays in a year; subtract 30 holiday/vacation days from that,
you get 221 working days.

€516 / 221 = €2.23

 _Can lunch be a mere €2.23 (US$2.50) in the Netherlands?_

My employer delivers free lunch to all its employees _everyday_ as well ( via
a service called
[https://www.servedbystadium.com/](https://www.servedbystadium.com/) ), but
the cost of this is typically around $15-$20 per meal.

(I estimate my employer has allocated about $4000/year per employee for the
free lunch. That's around 2% to 3% of the salary of most of our software
engineers, but salaries on average are about 3 times[2] in the U.S. compared
to the Netherlands.)

[1]
[https://www.payscale.com/research/NL/Job=Software_Engineer/S...](https://www.payscale.com/research/NL/Job=Software_Engineer/Salary)

[2] [https://triplebyte.com/software-engineer-
salary](https://triplebyte.com/software-engineer-salary)

~~~
superice
I think €2.23 is a little on the light side, but not unrealistic, considering
that a Dutch lunch mostly consists of cheap sliced bread with some form of
stuff spread out on it, mostly Gouda cheese, or any of the sweet stuff like
the traditional chocolaty sprinkles: hagelslag. I talked to the guy that buys
the lunch at our office, and his estimate is anywhere between €2.50 and €3.50
per person a day, but he did not have hard numbers. For Dutch standards, our
lunch is considered quite luxurious.

Then again, I'm not exactly sure what part of that is just lower prices in
supermarkets. As a student I routinely could cook dinner for under €2.50 per
person, although nowadays I'm averaging more like €4 pp, with rising prices
and me cooking for a smaller group.

------
purplezooey
The article talks about free food. But the most bizarre perk is how health
insurance is linked to one's employer. Whatever system we have in 20 years,
pretty much anything will be better than this one.

~~~
atemerev
In Switzerland, health insurance is still expensive and obligatory (which is
bad), but can only be paid from after-tax money, which is good and delivers at
least some market pressure to the system.

In the US, how do freelancers and individual consultants even work?

~~~
gvd
The obligatory part is the good part. In the Netherlands it is obligatory and
costs are lower than in the US.

~~~
atemerev
No, the obligatory part leads to less competition, less market pressure, and
therefore costs spiral. Our costs are almost on par with the US, and raise
every year.

~~~
alex_young
How does the obligation to buy insurance cause there to be less competition?
If someone doesn't have to have insurance, wouldn't the pool of possible
customers be smaller?

I agree with you on the cost comparison side - I've lived in both places and
find the systems quite similar in many respects outside of costs.

I think one key difference between the Swiss / American model and that of
other western EU countries is the cost of billing and processing. In the US a
full third of the cost of care is this part of the system, something that
doesn't need to happen when there is a single universal payer for all care.

~~~
atemerev
We don’t have a singe payer healthcare here, there are many insurance
companies.

Obligatory insurance destroys competition (and insurance companies are
lobbying hard to support it), because obligatory customer is a perfect
customer — you can be as bad as you wish to them, and they still won’t leave
you. With multi-payer insurance, they can still leave to other company (but it
still enables bad behavior in the insurance industry in general). With single-
payer, no such luck, you are at the complete mercy of the single-paying
entity.

~~~
akerl_
I think you may be misunderstanding “single-payer”. That term refers to there
being a single entity paying for the care (generally speaking, this is the
government), vs the US system which is multi-payer (you pay part of it, public
or private health insurance pays another).

In a single-payer system, there can still be many healthcare _providers_ , and
the single entity doing the paying is incentivized to push aggressively for
low prices from providers, because that keeps their own overhead low.
Likewise, they’re incentivized to keep their premiums low, because when you’re
the government, if people think you’re screwing up their healthcare they vote
you out of office.

As an example of this in the US, take the Medicare system, which can
negotiation super aggressively on pricing from healthcare providers because a
provider who lands a contract for Medicare knows they have a massive pool of
humans to provide care (and thus receive payment) for/from.

~~~
atemerev
I believe understand it right. What _motivation_ this single entity will have
to always have the best customers interests in mind? What will prevent it from
being sloppy, or even corrupted and colluding with healthcare providers?

~~~
akerl_
What stops any group of people from being sloppy or corrupted?

I called out the things that keep single-payer systems in check in my original
comment, which you’ve replied to: pressure from constituents keeps premiums
low (in the same way that the government is pressured to keep taxes low by
their electorate), and they’re incentivized to negotiate low rates with
providers because it improves their ability to keep premiums low without
having them be lower than expenses.

That said: the US’s current privatized system is sloppy and corrupt in a
multitude of ways, because their incentive structure includes turning a
profit, _and_ they can’t negotiate costs as hard as a single-payer system can,
because their pool of customers is smaller. So we’ve got the worst combination
of traits.

------
hardtke
Article misses an important point. Free food is a benefit, and ERISA requires
all employees get the same benefits. If you have a company with lots of low
paid workers, it doesn’t work financially. Silicon Valley firms mostly
contract out low wage jobs (janitorial, security) partially for this reason.

~~~
Longhanks
This is very interesting to hear. In Germany, we don't have a law as such, and
the employees of the company I work for that work less than 40 hours per week
have to pay for food at the cafeteria, while those who do get it for free. If
I understand ERISA correctly, that would be illegal in the US.

~~~
seppel
In Germany, free lunch is a taxable income. It might explain the difference
between full and part time employees. How does it look like in your payslip?

~~~
Xylakant
It’s not as simple as that. The employer can support lunch up to a set limit
by day (I think currently 6.40 EUR, but I might be wrong on the exact number
per day) and depending on the exact way things are laid out, the reminder is
taxed flat at 25% and not subject to social security. It’s actually one of the
best perks that an employer can give (the others are paying for a transport
ticket, or a bike). It provides real value, everyone has to eat and not paying
for lunch translates into real money unlike a flipper table.

------
bsimpson
> Free lunch, though, is not where the action is: the economics of free food
> are driven by free dinner. Lunch just amortizes the fixed cost of food prep
> facilities.

The Google SF office had lunch, but not dinner, for 10 years. Dinner is a
fairly recent offering.

~~~
warp_factor
free lunch is also good economically though, without free lunch most employees
spend 1+ hours outside the company.

With free lunch, most employee spend less than 25 minutes eating, then going
back directly to work.

~~~
bsimpson
I definitely understand why they do it; just providing a counterpoint to "they
only lunch so they can dinner."

That's been the exact opposite of my experience. It was an uphill battle to
get dinner at Google, so there were plenty of nights where the reason I left
was "I have to get home before my food options close."

~~~
Spoom
There are relatively few people actually getting dinner at my office, even
though it is offered four days a week. Perhaps an order of magnitude fewer
than those getting lunch.

------
baby
Just started a new job that offers the breakfast/lunch/dinner perks. There are
several aspects to it.

Retention:

* obviously, if the competition doesn't offer lunch, you want to go there

* obviously, if the competition offers lunch and your company doesn't, you will want to leave the company

* building a community starts with breaking bread. If you can get friendships and relationships to form via this mechanism then you will have a stronger retention, stronger ties between coworkers, etc.

cross-pollinating:

* grabbing lunch with someone else in the company is easier

Team:

* go grab lunch with coworkers to know what they're working on

* free lunch = better moral for the team

* you save time looking for lunch, so you can spend more time eating with your coworker

* since you all eat at the same place you randomly bump into coworkers, you often eat with them, etc.

Life outside of work:

* you can go earlier at work since they serve breakfast

* if you can bring food home, you don't have to lose time meal prep'ing and can spend more time doing other things

------
ascar
I'm not sure, if it's really the free part. I had free food at a previous
employer and loved it, but a company cafeteria with high-quality food, fast
service and acceptable prices serves the same purpose. And every single
company cafeteria I ate in so far had same or better quality food with more
options. The important thing is that there is an easily available place for
good food.

Big corps in Germany (and probably all around the world) usually offer that,
while small companies for obvious reasons cannot afford it.

------
gnicholas
> _At a minimum, it saves a little bit of search time and wait time. If you
> were going to work until 10, dinner that takes five minutes rather than
> thirty still saves you five minutes._

Am I the only one who doesn't understand this math? Isn't 30 - 5 = 25?

------
EliRivers
If it stops people eating lunch at their desk, I'm all for it. I've started
timing my lunches to coincide with some people near me so I don't have to
experience them eating lunch at their desks.

~~~
vbuwivbiu
<shudder> eating at desks must stop

~~~
elyobo
Why? Genuinely curious. Couldn't care less if people near me eat at their
desks.

~~~
0db532a0
Because some people have to work with complete barbarians who chomp with their
mouth open whole Granny Smith apples, whole bell peppers and whole celery
sticks without cutting them up, as if to deliberately annoy everyone in the
vicinity.

------
octocode
I disagree with pretty much everything in this article. I've never been
happier than when I worked for a company that provided free, daily, healthy
lunches. We were never coerced into working through dinner.

Now I have to food prep dinner and lunch. I'm making 4x the portions just so
we each have enough to eat for leftovers. I spend way more of my personal time
cooking and doing groceries and not with my family or working on my projects.
Food waste has skyrocketed since everything is bought in bulk, and sometimes
not all of it gets used. It's created way more dishes too, in meal prep and
tupperwares.

Sometimes we ate out the night before, or there are just no leftovers. I can
either get unhealthy fast food, wait an hour to get served at a healthy place,
or spend even more of my limited personal time preparing a meal for the next
day.

~~~
healsjnr1
I'm curious. It seems like the before after in this situation seems to have
more to do with not having a family / having a family, than working somewhere
that has food perks / doesn't have food perks.

Unless the the corporation is paying for your entire families food budget,
prep, cleaning etc, I think what you have just described is exactly the point
of the article: being single and having all (or most) household chores done
for you is really attractive and great, having a family and needing to do this
yourself for multiple people sucks and is hard.

Ergo, these perks prolong the time spent single and enjoying the perks.

~~~
octocode
We both lost cafeteria breakfast/lunch when we got new jobs after moving.

Making dinner used to be really easy, just grab some fresh ingredients on the
way home and throw together something small and healthy.

Now it's a whole performance. We're constantly trying to make bulk meals, and
store the rest for breakfast/lunch. We've gone from preparing 2 servings of
food per day to 6 or more. We needed to buy larger kitchen appliances and
equipment just to cook/store it all. There are 3x more groceries (We shop on
foot and bought one of those little carts) and 3x more dishes. It doesn't seem
like much but I've lost at least 30 mins a day, but probably a lot more on
average. The food I am eating is, on average, less healthy, less diverse, and
less tasty (I am no professional chef).

This article just seemed to resolve to a point that free lunch was a corporate
tool to discourage "family formation", and I ultimately disagree. I think a
lot of working parents would love to not have to worry about preparing their
own lunch meal on top of their families.

I just don't see the connection of "free food == single life", and the article
doesn't really establish one. At worst I'd still end up with the same amount
of time, and at best it has given me _more_ free time to spend with my family.

~~~
hkai
I'm unfamiliar with life in America, but why don't you just eat at a cheap no-
frills restaurant instead of buying groceries and spending time to cook all of
that food? Are those restaurants not available within walking distance, or too
expensive, or don't have good salads / fish / meat / whatever?

~~~
Balero
Cheap no-frills restaurants are typically unhealthy in America. Think
Mcdonalds. Also being a bit of a drive is not an issue.

Most of the US doesn't have a dining out culture like in some other parts of
the world, like Singapore, Vietnam etc

------
jacques_chester
The tax position of benefits varies by country. Australia, for example, has
the Fringe Benefits Tax, which is a tax on benefits levied on the _employer_
at the highest marginal tax rate.

Unsurprisingly, Australian workplaces are miserly. At my last job before
moving to the US, there was a hot water dispenser installed in the staff room.
But we, the employees, had to buy for coffee, tea, sugar and milk ourselves.
It was achieved on an honour system, with a little container where you would
throw in some cash from time to time.

~~~
dannyw
Food and drinks are not FBT’d in Australia.

> Food and/or drink provided to, and consumed by, current employees on your
> business premises on a working day are exempt property benefits

[https://www.ato.gov.au/law/view/document?DocID=SAV%2FFBTGEMP...](https://www.ato.gov.au/law/view/document?DocID=SAV%2FFBTGEMP%2F00015)

There are plenty of companies in Australia with very good benefits, like
Atlassian and Canva.

~~~
jacques_chester
I guess they were the regular sort of misers, then.

------
kinkrtyavimoodh
I used to work in a company that gave free food and I'd choose that even if
they offered to pay me 15 dollars per meal (B, L, D) for every weekday
instead. There is just such a massive emotional value to having free food all
around the office. It was a sad sad day when I left that job.

~~~
Zeebrommer
I think this is exactly one of the points the article makes: free food makes
employees stick around longer.

------
mark_l_watson
My most memorable experiences at Google were perks like the invited talks (I
got to have a very long chat with author of the Moose Wood Cookbook Molly
Katzen and a short chat about Reddit dropping Common Lisp with Alexis Ohanian)
and the interesting food at 28 cafes. The work was OK, I just did one specific
thing - not much freedom, but my main great memories were the perks.

Another great perk was the invited chefs from local restaurants who would be
guest chefs, and they would be available to talk with.

