Big step in the right direction. I also believe this will have huge impact on the morale as well. If you offer enough courtesy to your employees you'll receive a lot more in return. Personally, I believe this can boost productivity in a different way, because if the employee is challenged with a different set of problems other than the "same ol' " during the work time, the experience can be directly applied to the possible future employer's problems.

Granted, this can have downsides too.