WORKPLACE FITNESS CENTER

ANALYSIS 2019

Prepared by Sofia Aravosis

Wellness Committee Chair

Report distributed May 5, 2019

Prepared for Employee Wellness Committee

Cat’s Paw Inc.

 Workplace Fitness Center Analysis 2019 - 1

Transmittal
Enclosed is “Workplace Fitness Center Analysis 2019” as requested by the Cat’s Paw
Board of Directors. This report examines how the wellbeing of our employees can be
supported and improved in a manner that supports the corporate culture through the
construction of an on-site fitness center. It assesses both the potential positives and
negatives of the proposed project (including a limited risk assessment) and it includes a
case study of a similarly situated company and how they benefited from building a
fitness center for their employees. A digital copy of this report will be available at
www.catspaw.com/reports/workplace_fitness_center_analysis​ for those who wish to
view it.

While only one case study is included the collective wisdom of corporations is
considered so as to avoid mistakes.

With this report, it is the goal of the Employee Wellness Committee to inform the board
of directors on ways to strengthen our corporate culture and make this a place that is
both productive and profitable while meeting the needs of its employees. This can be
using the new facilities or participating in company sponsored health programs to keep
the employees engaged, growing and happy. Please contact the committee with any
comments or questions. You may call my work phone during work hours at (630)
492-3350 or email me at s.aravosis@catspaw.com. I should be able to respond within
48 hours.

Sofia Aravosis 
Sofia Aravosis
Wellness Committee Chair
Cat’s Paw Inc.
 Workplace Fitness Center Analysis 2019 - 2

Abstract
At Cat’s Paw Inc. we strive to put our best foot forward everyday, inspiring our
customers to do the same. We aspire to be our best selves, and the design and
manufacture of fashion forward footwear and accessories is our passion. Creating a
culture of health is connected to our core values: passion, excellence and growth &
happiness. We need to build a state of the art fitness center on the campus of our new
corporate headquarters in Long Island, New York. This fitness center is intended to be
one part of a comprehensive employee wellness program that will ultimately improve
company productivity and raise profits. Many companies have done the same with
great success. This report is in part a cost benefit analysis with a compact risk
assessment.
 Workplace Fitness Center Analysis 2019 - 3

Table of Contents

Transmittal……………………………………………………………………..1

Abstract………………………………………………………………………...2

Executive Summary…………………………………………………………..4

Analysis……………………………………………….……………………….5

Introduction………………………..…………………………………..5

Benefits…………………………………………….………………….6

Costs……………………………………………………...…………..7

Risks…………………………………………………………………..8

Design………………………………………………………………………...9

Conclusion & Recommendation…………………………………………..10

References……………………………………………………………….....11
 Workplace Fitness Center Analysis 2019 - 4

Executive Summary
This report examines one particular way to improve the wellbeing of our employees in a
manner that supports the corporate culture through the construction of an on-site fitness
center. The stated purpose of the Wellness Committee in writing this report is to
convince the board of directors why we should proceed with this project. The document
looks at the positives, negatives, and risks involved. The researched report also looks
at the success stories other companies’ wellness programs that included a
comprehensive fitness center with group classes and amenities. It seeks to avoid
common pitfalls by the identifying the greatest mistake of not seeking employee input
causing others to fail, as well as inherent risks to be managed.

There are many benefits to having a workplace fitness center for the company and the
employees - primarily: increased good health leads increased productivity, retention and
recruitment of top talent. Healthcare costs will diminish for the Cat’s Paw and our
valued employees, especially if we partner with our insurance company. If you look at
other companies similar to ours who built a program and fitness center like the one we
want, then you will see their employees reduced their health risks due to participation in
the workplace wellness plan. Other companies like Google report keeping satisfied,
trained employees instead of having to continuously invest in new hires. When new
employees are required, a state of the art, on-site fitness center will be a major
attraction and help bring in the best and brightest.

With the benefits of a project like this comes cost. The initial construction of such a
facility with all the equipment is the largest upfront cost. Another concern is hiring a new
manager as well as the maintenance of fitness center equipment. These costs would
be on-going. Our budget proposed budget took into how often our employees would
plan to use the equipment and our employees’ current fitness levels. A significant risk
involved with the creation of this on-site fitness center is increased likelihood of liability
issues. The legal team was consulted and is would prepared to draft necessary legal
documents protecting us as much as possible and still they feel that any monies paid
out from a lawsuit would be far outweighed by the financial benefits of an active, healthy
workforce.

The cost-benefit analysis conducted comes out in favor of including an on-site fitness
center as part of a comprehensive employee wellness program. Knowing the history
these programs and looking at other companies, you can see that in order to compete
Cat’s Paw must offer this employee benefit to compete now and in the future.
employees can shower when they are done exercising.
 Workplace Fitness Center Analysis 2019 - 5

Analysis
Introduction
History of on-site fitness centers; The history of workplace wellness starts in 17th
century Italy as documented by the writings of Bernardini Ramazzini, a physician
concerned with occupational diseases and interested in the possibilities of preventative
measures to improve the well-being of workers. For the purposes of this report, we pick
up the story in 1979, 3 centuries later, when Johnson and Johnson its ​Live for Life
program.​ Live for Life ​became the prototype for large corporate worksssment that aimed
to collect individual employee data on activity levels and BMI, which the company would
use to provide appropriate support in terms of weight control, nutrition, and stress
management.

Even as federal interest in worker’s health waned with the 1980 federal election,
corporations began to act. A body of academic literature on workplace wellness
programs began to be built. At this time, the concern focused on the effects of physical
fitness efforts workers performance. A 1982 article in the Journal of ​Occupational
Health ​discussed reduced rates of absenteeism and other costs related to illness. It
also pointed out how on-site fitness centers could potentially attract top talent.

By 1994, according to The National Survey of Worksite Health, 44% of enterprises had
facilities for fitness and were encouraging activities. The Pender Health Promotion
Model of 1996 provided companies with information and a framework for setting up a
worksite wellness program that took a holistic approach and targeting reversible
behaviors,

At the dawn of the new millenium, the US Department of Health and Human Services
published its own program ( an update of an earlier version) entitled ​Healthy People
2010. T​ he goal was for 75% of worksites with 50+ people to have a comprehensive
health promotion plan including five key elements: health education, supportive physical
and social environment, program integration into administrative structure, related worker
assistance programs and screenings (Rucker, 2016).

We found that in one of many recent articles on the subject Forbes Magazine listed
these same five elements as accepted best practices. Also according to Forbes, the
numbers of corporations across all industries employing these practices is on the rise
fueled in part by the Affordable Healthcare Act, as employers fight to keep expenses in
check. (Forbes, 2015).
 Workplace Fitness Center Analysis 2019 - 6
This report focuses on one case study. The Virginia-based company is similar in size to
our own with 12,000 employees across sixteen states adopted a comprehensive
wellness program similar to that we hope to adopt, including a state of the art fitness
center. Dominion’s initial outcomes as reported here are very promising:

(StayWell, 2015)
The success of any wellness program depends on whether it meets employees wants
and needs. Many failed projects did so because companies did not include employees
in every stage of the planning. This is why conducted a survey of employee thoughts
and preferences available to you on the company database.

Benefits

The general health of the employees will

improve as we promote preventative care and
address risk factors. We can partner with the
company’s health insurance company for onsite
health evaluations and screenings as an
essential first step. The decreases in health
risks for the employees translate in to key
benefits for the company. We predict a
reduction in on the job injuries as well.
(​Zojceska, 2019)
 Workplace Fitness Center Analysis 2019 - 7

“According to the RAND corporation study, every $1 invested in overall wellness efforts
yields a return on investment of $1.50. When the investment in programs targeting
chronic diseases, such as diabetes and obesity the R.O.
I. [return on investment] increases to $3.80” Clearly a
fitness center will help those with these chronic diseases.
(Valet, 2015).

Costs​:

The bulk of the costs lie in the build out and investment
in equipment. A list of gym facility and equipment costs
are included here below. The cost of the outdoor
amenities are separate. The planned soccer field and
walking trails are included separate budget for grounds
and site maintenance.

x 30 = $131,850
x 10 = $22,500
x 15 = $33,750
x 15 = $33,750
x 15 = $34,350
x 15 = $28,500
x 15 = $33,525
x 15 = $29,250
x 15 = $31,650
x 15 = $33,750
x 15 = $33,750
x 15 = $30,000
x 15 = $29,250
x 200 = $162,000
x 10 = $3,240
x 10 = $30,000
x 7 = $105,000
x 2 = $30,000
x 3 = $1,350,000
TOTAL
$2,154,520

The cost of a full time management:position is $65,000. Maintenance for the additional
indoor space including repair and custodial services are budgeted for $100,000/yr.
 Workplace Fitness Center Analysis 2019 - 8

Risks​:

Our new Cat’s Paw Long Island campus is 2 million square feet of office space and sits
on 20 acres. This by no means competes with Nike’s 286 acres but it is more than
twice the size of Google’s Hyderabad with the same amount of office space. We would
argue that while the growth of the company may require we expand, it is still a valuable
use of our space. The risk that we would need to either convert our fitness center
facilities in the future is there, but there is also the possibility that with our ever
increasing global presence, we may choose to open a new overseas headquarters, and
some U.S, based employees would even need to relocate. Our research into other
corporations of our size indicate that competition from outside health/fitness clubs is
minimal due to the convenience of having a free, on-site state of art fitness center.
However, even this risk can be mitigated by making the facility available to employees
before and after work as well as during hours. Liability issues were put to the legal
team who determined that risk of a major lawsuit from an injured party are far
outweighed by the benefits financial benefits derived by the company that they predict
will increase yearly.
 Workplace Fitness Center Analysis 2019 - 9

Design

For the fitness center layout and equipment we looked for inspiration to Google’s
campus in Hyderabad (India), as well as Nike in Oregon. The gym includes a yoga
studio and room for Zumba lessons. Instead of a cricket pitch or a football field, our
employees asked for a soccer field, which could also be used for ultimate frisbee. We
plan to have intramural teams for both. We surveyed current employees to determine
interests and times people anticipated on using the various facilities so that we could
correctly estimate the number of lockers and showers needed. Planned amenities
include everything from the basic towels and soap/shampoo to healthy snacks and a
juice bar. (These costs should be included in the hospitality and food budget and thus
were not included in this report.)

(OfficeChai,2017)
 Workplace Fitness Center Analysis 2019 - 10

Conclusions and Recommendations

Employee wellness programs have seen documented successes which increased as
time goes on. Including a on-site fitness center to our plans will increase the health and
wellbeing of our workers while increasing profitability. An engaged, happy workforce
will want to come to work, be less burned out and stay on the job longer. Moreover, a
fitness center is expected by the current generation of young talent. A state of the art
facility will underline our commitment to excellence and our passion for our mission and
employees. The benefits of the fitness center greatly outweigh the costs which can be
mitigated with time. The biggest negative would be the initial cost of the construction of
the fitness center. We can mitigate the risk of under utilization by actively promoting its
use of the as well as providing incentives as discussed earlier in this report. As stated
before we surveyed our employees to make sure the fitness center was in a good
location, with desirable hours and amenities. Our collaborative design of the fitness
center was inspired by Google and Nike amongst others. Research into other
company’s experiences, Cat’s Paw would greatly benefit from investing significant
resources in an on-site fitness center that will result in employees increased job
performance, retention and recruitment of new top talent. Also, as stated in the report
we recommend a fitness center manager be hired to run the day to day.
 Workplace Fitness Center Analysis 2019 - 11

References​.
123RF. (n.d.). BIGPAW [Cat paw image]. Retrieved May 5, 2019, from
https://www.123rf.com/photo_79099306_stock-vector-big-black-cat-paw-print-leg-foot-w
ith-nail-claw-red-heart-sign-symbol-cute-cartoon-character-body-pa.html

Barberio, J. (2017, March 2). 10 Companies With Incredible Office Health and Wellness
Zones. Retrieved May 5, 2019, from
https://www.workingmother.com/10-companies-with-health-and-wellness-zones

Goetzel, H. D. (2016, March 31). How to Design a Corporate Wellness Plan That Actually
Works. Retrieved May 5, 2019, from
https://hbr.org/2016/03/how-to-design-a-corporate-wellness-plan-that-actually-works

Levin, R. (2019, April 24). 45 Kick-Ass Corporate Wellness Programs to Copy. Retrieved
May 5, 2019, from
https://www.snacknation.com/blog/successful-corporate-wellness-programs/

OfficeChai Team. (2017, July 06). The Google India Head Office And Its Perks Will Make
Your Job Look Like A Joke. Retrieved May 5, 2019, from
https://officechai.com/offices/google-hyderabad-office-hitech-city/

Rucker, M. (2016, May 20). The Interesting History of Workplace Wellness • Mike Rucker,
Ph.D. Retrieved May 5, 2019, from
https://michaelrucker.com/well-being/the-history-of-workplace-wellness/

The StayWell Company, LLC. (2015). ​Case Study for Dominion, power is in a healthy
workforce[​ PDF]. The StayWell Company, LLC.

Valet, V. (2015, July 08). More Than Two-Thirds Of U.S. Employers Currently Offer
Wellness Programs, Study Says. Retrieved May 5, 2019, from
https://www.forbes.com/sites/vickyvalet/2015/07/08/more-than-two-thirds-of-u-s-employe
rs-currently-offer-wellness-programs-study-says/

Zojceska, A. (2019, March 16). 8 Key Benefits of Employee Wellness Programs. Retrieved
May 5, 2019, from
https://www.talentlyft.com/en/blog/article/273/8-key-benefits-of-employee-wellness-progr
ams