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Saving a Dime – Losing a Dollar

Cup of CoffeeI sometimes wonder how people think when they formulate a policy for an organization. It would be interesting to be a fly on the wall and hear the, hopefully, vivid discussions before the decision is made. One such interesting example is when a public organization decides to charge the employees for tea and coffee. The argument for this decision is to save money on tax. That is honorable and my problem with the decision would not exist if the charging were to be made directly at the coffee vending machine. In that case there is an arrangement between the coffee provider, the company that installed the machines within the premises, and the consumer of the coffee. A problem arises when the same organization says that they can take over the charging from the coffee supplier and make a deduction from the employees’ salary.

The employees of the organization must go to the administrators to “buy” their “coffee-card”. The card is loaded with a number of cups of coffee, and one is deducted for each cup of coffee bought. When buying they are noted on a list, which then will be a record enabling a deduction to be made from their paycheques. When the employee’s card is empty they need to start all over again by going to the administrators and buying another card for a fresh cup of hot java or hot cocoa, whichever they prefer from the machine.

What is the problem, you might say? The problem is twofold.

One is that there is a custom in most workplaces to provide the employees with free coffee, hot cocoa and tea. It is not something that is normally charged for. If that is the custom at local workplaces, and you decide not to have it, then you also give a signal to the employees that this workplace is different. You show them that you do not treat them in the same way as they would be treated in other places. Should not the workers in a public sector organization have “the basic” privileges that “everybody else” has? How else should we attract skillful workers to the public sector if they start to differentiate themselves too much from the rest? Is the public sector only for those that have the vocation of serving the public? Of course I believe that it is good to have employees who are true to his or her vocation and have the right skills. It is also good if we can attract those who have the right skills and that may develop their interest of serving the public. We can’t push these people away with silly rules – like not having free coffee and other things that. I’ll talk about this in another blog post.

The second part of the problem is more severe and that is that the decision was made with the argument of not wasting the taxpayers money on coffee for the employees, at the same time as their decision means spending even more money on administration of these coffee-cards. The amount of money that is spent on administrating coffee-cards is effectively several times more expensive than the free coffee! Many hours are spent:

  1. Managing the list where the employees write their name,
  2. Managing the coffee-card (loading, reloading and handing them out),
  3. Transfering the list of employees into the salary administration system and making the deduction from the pay-cheque for the right person,
  4. Answering questions from the employees about the management,
  5. Answering questions from the employees about deductions that they feel are not correct,
  6. Making corrections for erroneous deductions,
  7. Managing reimbursements for people who have offered a guest a cup of coffee, and used their personal card to pay for it.

All this management would not be necessary if the coffee were free. Then it would only be the dealing with the invoice from the coffee and that invoice is sent anyway.

On one U.S. Coins and Paper Moneyhand the organization will save a dime on the coffee not-offered, but on the other , they lose a dollar on all the managment of the coffee-cards. These are dollars that are also taken from the taxpayers account! So as a taxpayer, I must say: “give the employees their free coffee and stop wasting my money!”

So not offering your employees free coffee and managing it through the paycheque is just stupid! To quote my friend Steve Towers, it is “Dumb-stuff”, which should be removed as soon as possible.


Get yourself a cup of coffee, tea or hot cocoa and please comment and share whilst you drink it!


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