By Deborah Moon, Reward Blogger
It hardly seems possible but another football season is now in full swing. The start of the new season was preceded by the usual transfer tales, accompanied by much media comment, hype and speculation. Of those players dominating the transfer headlines two in particular, Wayne Rooney and Luis Suarez, seemed to pose somewhat of a “challenge” to their respective clubs, illustrating the type of conundrum often facing employers – how to provide a sufficiently attractive offering to retain their top talent, ensuring those individuals continue to be fully engaged with the aims and aspirations of the business and are motivated toward the achievement of organisational success.
The difficult economic context within the UK in recent years has constrained employers’ ability to enhance their pay and reward packages – indeed, figures recently released suggest that wages in the UK have suffered one of the sharpest declines in Europe over the last three years. However, with fears about job instability and insecurity prevalent in the employment market, many employees have preferred to “sit tight” and accept this position rather than seek a move elsewhere. But is this situation about to change? According to the KPMG/REC Report on Jobs for the month of July, permanent staff appointments rose at their fastest rate since March 2010, with the number of vacancies hitting a six-year high. Increased demand for permanent staff across a range of sectors was seen as indicating a growing confidence amongst employers and a more buoyant jobs market. These findings also appeared to be supported by the latest Labour Market Outlook survey from the CIPD, with employment confidence reported as reaching its highest level since 2008. What will this mean for pay and reward practices and how prepared are employers who may find that their best staff start looking for better offers elsewhere?
The CIPD’s Reward Management Annual Survey Report for 2013 demonstrated the important role employee benefits plays in the total reward package, with many employers indicating they would like to see a shift in the proportion of their total reward spend from pay to benefits, notwithstanding the economic slowdown and resulting implications for base salary levels. But with an apparently increasing range and diversity of benefits on offer, how confident are employers that they are maximising the investment made? To what extent do these benefits assist in achieving an engaging and high performing workplace and what is their perceived value by employees? These were some of the issues considered at the recent CIPD Reward Forum event Employee Benefits – are they working for or against you?
With Duncan Brown, Principal, Aon Hewitt Consulting, providing his usual insightful overview of the UK benefits landscape, illustrated by two case studies from Tui Travel and Scope, the importance of a clearly articulated total rewards strategy, aligned to business-specific outcomes, and underpinned by an understanding of the different reward preferences of key employee groups, was well demonstrated. In addition, the critical importance of an effective communication strategy which presents all aspects of the reward package in an integrated way, using a variety of channels to help improve employee awareness, understanding and appreciation and regularly reinforcing this message throughout the year, continues to be a challenge for many employers. And as the case studies showed, the overall strategy, design and delivery of the package must be organisation-specific, with differing needs of the identified target groups likely to require a more segmented approach rather than a “one-size-fits all”.
The importance of regularly reviewing and, where appropriate, amending your strategy, as well as asking for, considering and acting on employee feedback was also highlighted. The identification of clearly articulated business objectives will enable an evaluation of the reward components and assist in determining the level of effectiveness and considering where improvements can be made. This will help ensure that all aspects of the pay and benefits package are providing an optimum return for both employer and employee and that they are conducive to and supportive of a high engagement/high performance workplace, where everyone feels part of the team and is focussed on collective, as well as individual, success.
An appropriately aligned reward strategy is key to talent attraction and retention at all levels (not just the “superstars”) – with this issue a seemingly growing concern for employers, ensuring this is working appropriately for the respective parties can play a vital role in minimising or avoiding the risk of a “transfer request”!
NB: the next Reward Forum event will take place on 19 September, with a focus on Pension auto-enrolment: the lessons for small and medium sized organisations.
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