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Comment by pkfrank | Hacker News Reader

The "Novel Ways:"

1) Housing stipend of $500/mo if employees live within a 10-minute walk of the office

2) A semi-annual retreat / hackathon where employees cook meals, hang out, bond, code, and present their projects

3) Plane ticket anywhere in the world that must be used between their 1 and 2-year anniversary at the company.

I know of many companies that already do #1 and #2, but I suppose I haven't heard of this complimentary vacation ever before. Seems like a pretty awesome perk, which shows they respect and value work/life balance.

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Interviewed with their lead front-end engineer for a front-end engineering position. Everything was great then he asked me for my "story". I answered as best I could but I guess it wasn't what he wanted to hear so he re-iterated that he wanted to know if he would like working with me. I think that's great thing to determine but was put-off by the question-- I got the feeling I would be working with a bit of a tool.

He also put a ton of emphasis on it being a "start-up" and essentially said something along the lines of "in this type of culture its expected that you earn less". I can only guess they passed on me because of my salary requirements which are ~20k under the average. If that is the case which I can only guess it was, not exactly filled with respect or value for work/life balance. /2 cents

EDIT: and jeez they are pushing themselves hard on ycombinator lately.

    "in this type of culture its expected that you earn less"

Serious question: is there any other for-profit industry where candidates wouldn't laugh in your face for saying something like this?

Personally, I am totally ok with this. If "start-up culture" means 20 days of PTO, free meals, free gym, a ton of other perks, I would care less about the year end dollar amount. Perhaps that's just me though.

Famous last words. After seeing several SF startups implode, I'll never make the mistake of taking under market pay. I would much rather choose how my compensation gets spent rather than an employer make that decision for me.

It's easy to get lured into the excitement of working in a "start-up culture" but you will recognize the red flags after one has sucked you dry without adding much to your finances.

That's not what "start-up culture" means.

Some parts of aerospace, specifically the higher profile projects where people will feel like they have bragging rights for working there. Also, maybe the game industry? Basically any industry where people people are dying to be on the inside, despite what the job may entail or their long term prospects.

The strange part, though, is that there's so much money pouring into tech startups right now, and so with a little bit of negotiation skills, you can find all the sexiness and get paid really well.

(This is not meant as a criticism of ZenPayroll or their front-end lead in particular, especially since this instance is just hearsay, but I've come across the attitude described before and have found it personally baffling every time.)

Game development

Well when you consider the second half of that type of statement is that you are expected to earn less because you are being given a large equity opportunity in the company you will help build...the statement makes a lot more sense.

To flip your question around: Is there any other for-profit industry where employers wouldn't laugh in your face for saying you would like 0.8% of the company worth in stock options in addition to your salary...

It all boils down to whether you believe in the company you are building. If it is positioned to do great, then of course you would want the equity for that IPO. If you don't have that faith, then what are you doing interviewing at that company anyways...Use your skills to get a higher paying job without the options.

Game programming, space exploration, acting, music, movies, sports, anything where demand for employment outstrips demand for employees.

why would a frontend lead talk salary with you?

The $500 per month housing stipend seems a little disingenuous. If the concern was truly about employees and rising real estate prices, why not raise wages by $6000 across the board? It isn't like real estate magically drops in value half a mile away or commuting longer distances is free. Is the policy an attempt to remove an excuse why an employee can't be in the office? Do they want the ability to call an employee during the evening and have them on site 10 minutes later? Do they want to ability to lower wages in the future with less resentment (it is a lot easier to cut perks than salary)? Maybe it is cynical, but those all sound like more realistic reasons to have a housing stipend based on proximity to the office than true concern for their employees.

I don't think it's cynicism at all. It may not be explicitly about being able to call someone up at 8pm, but rather about building a culture where everyone is hanging out at the office all the time and your social circle revolves around your coworkers. That's a deal if the company can get that for $500/month.

How long does it take for landlords in the area to realize that there's an extra $500/mo to be had?

Assuming there's more than one landlord they will capture some of the value but not all of it.

E.g., they would be incentivized to raise rents $500, but then one of then could get more business by only raising it to $450 letting the employee capture $50 a month, and so on and so forth.

This reasoning is based on false circumstances. SF has a landlord's market, so they have no reason to shave the price for more business, but they have ample reason to raise the price to extract as much value out of the property.

By your reasoning, every landlord can raise their rent by an infinite amount and maintain at least the same revenue.

have you seen the rent increase graphs; they're in the process.

Only if the number of zenpayroll employees willing to live in that neighborhood > number of available apartments in that neighborhood

In a non-cynical mode:

1) turns your employees into neighbours

2) reduces wasted commute time

3) increases exercise compared to drivers (10 mins is better than nothing (edit: twice a day!)) thus reducing medical costs

4) reduces absenteeism due to dental appointments, kid concerts, etc that tend to be near home. Improves family life.

5) reduces the carbon footprint of the business

6) reduces the car-related absenteeism: breakdowns, maintenance appointments, even injuries and deaths.

Increasing salaries would do none of these things.

Oh boy, I just thought of a really good one:

Some parents with young children find it difficult to get time to be alone in private while not exhausted. This can cause awful stress on a relationship. "Lunchtime" with a partner at home can make a big difference.

This might not sound like a big deal to the pre-kid people, or those with tons of energy after the kids are in bed, but for some people this is a relationship-saver.

Lunchtime at home? Better hope you are not on lunch making duty at the office, it's company culture don't you know. You do want to be a team player don't you?

Besides, how reasonable is it to expect to be able to raise a family in downtown SF? Surely if you want space, good schools, and room to grow an extra $500 in downtown rent terms isn't going to make that much of a difference.

Doesn't have to be every day. Doesn't have to be SF. And $500 makes $500 difference* no matter where you are.

Edit:

(* ok, maybe $300 difference after taxes.)

Exactly. There are many reasons why an employer might want to give a stipend for (fill in desired behavior) as opposed to just increasing pay.

Some companies give stipends to employees who commute using public transportation. They could just give everyone a raise to cover those fees, but tying the stipend to the behavior actually encourages people to do it.

If they wanted people closer to the office it would have made so much more sense to NOT be in SF itself. $500 doesn't go very far in that neighborhood. That's roughly a walk in closet.

I'm very confident that $500 was not meant to even remotely cover the rent. It's just a small stipend to help.

My cynical guess was that it makes it harder to leave, you're in an expensive area and can only justify being there because of their perk. I definitely appreciate the less cynical reasons though.

Its more tax efficient that way.

The free vacation ticket is a creative perk, and it's nice that they reward people after a year, but I don't think it's actually that awesome compared to other popular perks.

If you boil it down to numbers, the most you're looking at is a $2000 round-trip ticket to Japan. So it could be similar to a ~2% salary bonus your first year. But of course in practice, most people will get cheaper tickets, and this bonus doesn't give you anything after year 1. Compare this to the $500 stipend - that's $6k every year, and it directly affects your checkbook, instead of being a perk you may be able to enjoy.

The spirit of it is very nice, as a reward for loyalty. But I think it's always useful to look at the bottom line as well.

I've heard Palantir does #1. I live in SF and my office is in SOMA- still takes me about 45 minutes to get to work on Muni. Living in SOMA would be more expensive but palatable with the stipend. That would be very convenient.

I think I heard about this perk during the earlier days of Facebook.

Facebook was our inspiration for this perk. I think they had it ~2004-2008 and it was a one mile radius. I was working at Zazzle at the time and many of my classmates who joined Facebook lived in the downtown Palo Alto area as a result.

At some stage Government a both federal and local are going to wake up to all those benefits in kind that sv seems to hand out - as a way of raising additional tax with very little pain the hard working familiy's (tm tony blair)

After all what voter is going to argue with clamping down on tax avoidance if it means that the increase in property tax isn't as big this year or that the federal government can use this additional tax to reduce the deficit (or more likely for pork in some agricultural state)

Not sure if you're suggesting that they will tax those benefits specially or if they'll raise general taxes to cover for the tax-avoidance of those benefits.

Either way, health care is the precedent here. Wage freezes in WWII resulted from FDR's Executive Order 9328[1] left employers in a lurch. The government had control of all wages, earnings, etc., and those wages were (basically) frozen by position. A tax man made $x, while an ad man made $y, no matter where they worked.

This put employers in a tough spot because, so long as incomes were the same everywhere, hiring was difficult because they couldn't raise wages to attract candidates, so they petitioned the government for an exemption on health care benefits, as a way of attracting new hires and competing in the market place. In competitive industries, as these benefits were given in lieu of free market wages, benefits became fairly lavish, and for competitive positions, health care benefits became the norm even after the wage freezes were eliminated, but the net result was that health care as a benefit grew 700% in a 20 year span.

The sum of all that of course is the system we have now, where health care is so broken as a system that we're going to 'fix it' with more of the same, but that's another discussion.

[1] - http://www.archives.gov/federal-register/executive-orders/19...

I know its one of the reasons the USA didn't end up with a German style insurance based health system in the late 40's early 50's.

Taxing the benefits is the fairest way to do it.

You could handle this by moving to a system similar to the UK PAYE - any benefits in kind are identified to the Tax man by your employer (via the P60 form) woudl simplify the federal tax system.

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