And this has resulted in a higher productivity, a 12 percent boost at work, a research said, adding that the firm may actually have hit the right idea that happy employees do work harder.
"The driving force seems to be that the happier workers use their time more effectively, increasing the pace at which they can work without sacrificing quality," said Daniel Sgroi from department of economics at University of Warwick in Britain.
According to the researchers, Google was at the forefront of improving its employees' happiness with its perks that include free food, buses and gyms along with sports courts and even a slide to get between floors.
In a series of lab tests, they found happiness made people 12 percent more productive.
The study included four different experiments with more than 700 participants.
The participants were either shown a comedy movie clip or treated to free chocolate, drinks and fruits.
Others were enquired about recent family tragedies to assess whether lower levels of happiness were later associated with lower levels of productivity.
Companies like Google have invested more in employee support and as a result employee satisfaction has risen, concluded the researchers in the study published in the journal of Labour Economics.