According to the Journal of Occupational Health as referenced in a blog article by Tara Parker-Pope of the New York Times , employees who had flexible schedules were more likely to engage in healthy behaviors and take advantage of employer sponsored exercise classes.These employees also reported sleeping better which could be a result of reduced stress levels.
I also believe that employers that are willing to be more flexible with their employees, and show that they respect and value their employees time will be rewarded by more productive, loyal workers. This has been demonstrated in one remarkable instance where a company experienced a 33% increase in productivity.
The company was Best Buy,in Minneapolis, and they allowed employees to basically work whenever they wanted, as long as they got their work done. Additionally, within the first three months after the new "rules" were implemented, turnover fell from 14% to zero, job satisfaction rose 10%, and their team-performance scores rose 13%.