Saturday, July 19, 2014

Employee Parking

I lived in Japan from 1995 to 2003 and was spoiled for transit.  For the majority of my stay, in Kyoto, I had the option of three train lines to go to work, one of which so close to my apartment that I could slip on my shoes as the signal at the nearby level crossing sounded, take the two flights of stairs to the street and board the train at my station as it pulled up.  The other two lines were run by Hankyu, a large conglomerate that directed its traffic to its flagship department store and real estate developments in downtown Osaka and Japan Rail, the national railroad that links the entire country together and is responsible for developing and operating the shinkansen (bullet train).

The experience there comes to mind not so much because of the convenience of rail in the neighbourhood where I lived but for one contract negotiation I had with an employer there.  It is common practice for employers to pay for their staff's rail pass to commute to work.  I had even seen salarymen who had passes that allowed them to take pretty substantial daily trips via the shinkansen from home well outside the Kobe-Osaka-Kyoto metropolitan area.  Clearly this is a pretty expensive commitment on the part of employers and of course it helps subsidize rail service as well.  At the risk of digressing before getting to the account of my negotiation there was one Japanese colleague I had worked with who was looking to sell his car after owning if for about 10 years and disclosed that it only had 40,000 km on it.

For the negotiation in question I was offered a rather disappointing raise despite my length of service and the strong evaluations I had received.  I decided to make the case that I was cheaper than a new teacher because of the low cost the school paid for my commuting, which was 310 Yen one-way compared to the 980 Yen they would pay for a fresh-off-the-plane, prone-to-taking-the-train-west- instead-of-east, completely inexperienced teacher with a dodgy command of the fundamentals of English grammar.  Given my job performance and the difference in transportation costs, I tried to make the case that it would be more cost effective to keep me with the salary I was requesting than it would cost to replace me.  If they could pay me the savings they were making on transportation then I would stay.  They chose not to and saw that fresh-faced replacement last about 3 weeks.

The interesting thing that transfers to the Canadian context is that employees rarely have as transparent and accounting of what their employers are paying for their "free" parking (if and when it is provided). There are few organizations that provide incentives for employees to use transit or to walk for the sake of sparing the organization the cost of providing a parking lot.  Whether it is an expanded footprint to provide surface parking on site or the cost of building, maintaining and enforcing underground parking on site the costs are rarely integrated into the consideration of the compensation packages unless they are motivated by a shortage of parking and want to entice employees to use transit to forego any tensions over on-site parking for an organization that is starting to grow beyond the space that it has for its staff.

In Calgary, a monthly transit pass is $90 a month and there are few if any places in downtown Calgary where a "free" parking place that an employer provides its staff could be built, maintained and operated for that monthly rate.  It may be worthwhile for more employers to open up this aspect of its compensation to staff and look at strategies to make more feasible use of that space.  While there are annual weeks that are dedicated to improving use of transit or bicycles or other forms of commuting to work, it may be worthwhile to look at ways to incentivize transit use or walking to work (if there is a formula to value that).  Perhaps the simple benefit of paying for a transit pass would be sufficient.  That would impact overhead that an employer takes on for providing parking and perhaps even create an alternative revenue stream by renting the surplus parking out rather than retaining it at a loss and skewing the cost of parking and the compensation that is provided to your employees by not fully accounting for those costs.

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