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Who started giving out company benefits?

Here's you at 24 years old. You started your first job. You have gone through several rounds of interviews. The company that you really wanted didn't accept you but you took another offer instead. You see the contract and you read carefully on the terms and conditions. You examined it properly and read every single word like the way you accept an online T&C. You're delighted that you have 3 more days leave than your peer. You have gym membership allowance and there is monthly buffet lunch for the team. Life is good and you are glad that your company gave you so much benefits. 

 

But where did all these benefits come from? You're gonna say it comes from the company. 

Yeah, I know that but what I am asking is who started giving out these benefits? How did the benefits evolved to such sophistication? Who gave the first idea of giving free food?

 

To really understand where the first company benefits come from. We need to understand where a company started. One of the most famous ancient company in the world is the Dutch East India Company dated back in 1602. That's more than 400 years now! 

 

But that's not the oldest company recorded! In Japan, a construction company called Kongo Gumi was founded in the year 578 and has been running continuously ever since until it was acquired by a parent company. Very impressive to be honest for a company to survive that long. To give you a perspective of how long it was, the Vikings discovered Iceland in the year 861. Genghis Khan died in the year 1227. Charles Darwin publishes On the Origin of Species in the year 1859. 

 

Phew, now you might think that the history of company establishment will explain where company benefits come from but not exactly. Long ago in America, farm owners needed workers for the increase in demand of the workforce. To ensure that they retain their workforce, owners often have to increase the pay and over a long period of time this can be very costly to them. They are also in dilemma because employers wants to ensure that they will leave the workforce once they are too old or expensive to keep. So, where do you go if two companies pay exactly the same?

 

Then comes the pension plans. American Express railroad company established the first pension plan. Imagine your company is the only company that has pension plans at that time, would you not join?

Many companies follow suit including banks, manufacturing companies and so on. Finally, the federal government adopted it too. Choosing which company to go was and is still a privilege because perks are different everywhere. Interestingly, company benefits include paid vacation or sometime we called it paid leave. And according to history, President William Taft was the person who proposed that every American workers needed months of vacation in order to "continue his work next year with the energy and effectiveness which it ought to have". 

 

The law never pass. The European countries soon adopted this concept and today, the OECD countries have the highest paid annual leave of its kind with France having a mandatory 30 days paid annual leave (pack your bags now!). Even until today, the United States still do not have statutory national mandates for paid leave. Well, this does not mean that companies in the US do not give out leave. Most companies do because it does not violate the law and secondly, it attracts people. 


In fact, many companies especially many tech startups in Silicon Valley are now the pioneer in giving uniquely attractive employee's benefits that attracts a wide spectrum of workplace especially the millennials. But I shall leave that in another post. In the mean time, can you imagine a company today without any employee's benefits? 

Ken Teywork culture