It would be sort of weird if we turn back into having sort of 'company towns' where your employer provides a lot of what you need except they pay for it. It's not just Google this would be beneficial for, even if you run a factory you could pay employees a tiny bit less, but provide food/services for them that would make up for it. And because of the taxes/bulk situation it could be economically beneficial for both sides.
Meals on the business' premises for the benefit of the business are not taxable income for employees (but are a deductible expense of the business). This is a black-letter IRS regulation; https://www.irs.gov/publications/p15b/ar02.html#en_US_2016_p...
Meals are a sideshow, though; healthcare is where the real action is. If work buys you a Playstation you get taxed on ~$300 in imputed income; if work pays $12k~$25k a year for your health insurance, that isn't taxed.
I used to work for a subsidiary of an auto company, and I got a new company car every year. But those cars were used partly as test vehicles; they were maintained at the company garage by company employees, so they had a benchmark on maintenance problems. The company could make a tax case for that not being income. This only works if your employees are using your own product.
"Employer-sponsored health insurance plans dramatically expanded as a direct result of wage controls imposed by the federal government during World War II. The labor market was tight because of the increased demand for goods and decreased supply of workers during the war. Federally imposed wage and price controls prohibited manufacturers and other employers from raising wages enough to attract workers. When the War Labor Board declared that fringe benefits, such as sick leave and health insurance, did not count as wages for the purpose of wage controls, employers responded with significantly increased offers of fringe benefits, especially health care coverage, to attract workers."
- https://en.wikipedia.org/wiki/Health_insurance_in_the_United...
I expect that it's a mix of two things:
1. You can make a case that keeping them in the office (rather than making trips out) is a business need, and it might hold up to scrutiny. This probably covers things like coffee, juice, snacks, etc. The company legitimately does benefit from (some key) employees not constantly leaving the office for small necessities.
2. There's a lot of low-level tax fraud the IRS is too understaffed to deal with (and is directed away from corporate fraud like that, anyway). So you probably are supposed to report the value of the meals you get, but no one tracks it, and each employee is only committing a small error, so the IRS can't justify dealing with every case.
The IRS actually has a great PDF on when giving an employee a free meal is a taxable benefit or not. (I found it a couple years back when starting a small corp, but can't seem to find it now.)
Ed:
According to this document [1], Google providing meals probably falls under a nontaxable status because they provide them on campus and there isn't a lot of food near the campus. (Section starts on page 43.)
For example, if a free lunch allows an employees to have a lunch meeting, the IRS considers that for the company's benefit.
Whether all of Google's perks actually satisfy that test is a different issue, but that is the IRS's rule.
Sounds like a rule that is hard to impossible for the IRS to enforce. I hate rules like that, we ought to create a better rule or get rid of it altogether. Because I'm guessing if a factory lowered their wages while providing the same perks as google the IRS would probably say something.
You'd be amazed how much exercise helps with concentration and reduces stress.
With that logic you could fund your employees entire lifestyle if you made the case that it helps them be more productive.
Yes, potentially though it'd probably help to have data supporting that. But things like company housing or sleep pods can materially benefit the company (for one thing, if you can take a nap at work you'll work longer hours).
> Should they pay for a nanny because help with child care makes you more productive?
Sure, potentially. In fact, employer-provided childcare is a tax-free benefit.
This even goes for things like salaries. If a company pays salaries that are way above the market rate, this could be seen as [corporate] tax fraud. But there often isn't a bright line in law, which is frustrating to us engineers who think deterministically.
It would be weird but it would make sense, in the same way that theoretically the 'best' government in a benevolent dictator. When it's good, it's great, when it's bad, it's BAAAD.
I know that may seem like a small thing, but providing jobs for the less educated off sets at least some of the problems these companies face with gentrification, gender and racial diversity etc.
Yes. Amazon has, by far, the highest turnover amongst tech companies. [0]
[0] https://www.buzzfeed.com/carolineodonovan/amazon-rewards-emp...
If that was really the case then why do so many companies offer no perks to their employees?