Closing the perception gap between what staff and employers consider fair reward

Need to know:

  • The gap between what an employer offers and what employees consider fair reward is often the result of failing to listen to employees’ needs when planning benefits strategies.
  • Nevertheless, often the right benefits are in place, but simply lack effective communications aligning them with employee expectations.
  • In communicating the value of non-financial rewards, employers should harness the power of storytelling, to showcase real examples of the valuable impact these benefits can have.

Employees are becoming more discerning when it comes to benefits packages and increasingly expect more than they are offered. The result is a gap in perception between what an employer and its employees consider to be fair reward, which can ultimately impact engagement, productivity and retention.

Debra Corey, author, speaker and adviser to Reward Gateway, says: “Too often, [employers] don’t listen to their employees, they fail to ask them what they want, need and believe to be fair, and often don’t design their benefits based on strategy; so, even if they do listen to their employees, it strays away from what really matters, to the [organisation] and to employees.”

A second gap also often appears even when benefits are well aligned with employee need, as the result of simple miscommunication. “If employees don’t know or understand the benefits being provided, they are never going to believe they are fair, because they just don’t know what they are,” says Corey.

What is fair?

Organisations trying to promote benefits and remuneration as ‘fair’ often make their first mistake by reducing this to monetary values, rather than trying to align it with what is important to the the individual.

Cheryl Brennan, director of corporate consulting at Howden Employee Benefits and Wellbeing, says: “With an ageing population, increased focus on mental wellbeing, an NHS under strain and a current estimated social care funding gap of £1.5 billion, the employer’s role in creating solutions to support employees’ needs is greater than ever. Employees will increasingly be looking at ‘what [do I] need to have a protected and healthy life’ rather than ‘what is fair’.”

Often, the right structures and supports are already in place. The problem is that the language used can fail to articulate the value of the benefits provided; in many instances, the journey to meeting employee expectations can be as simple as changing how existing provisions are positioned.

While there is still a place for traditional methods of engagement in the effort to address this, there is an increasing understanding that technology can improve the situation.

A multi-channel engagement programme informed by detailed analytics can help employees understand and actively take advantage of the benefits being made available to them. Craig Monahan, senior proposition manager at Standard Life, says: “Our insights show a positive correlation between digital engagement and the average size of an individual’s pension pot, suggesting that when employees are digitally engaged they look to save more for their future.”

The total reward statement (TRS) is another vital tool for ensuring that employees are aware of the overall value of their benefits package. Delivered in a clear, concise, engaging and interactive way through a platform, a TRS can work as the first step in any benefits communication or to reinforce the value of a reward strategy throughout the year.

Clear value

One area in which employers often struggle is in helping staff see the value of the non-financial elements that form part of their benefits provision. Organisations should, therefore, get more creative with their communications, says Alex Bennett, head of employee benefits at Upgrade Pack. For example, this might mean using intranets to show the positive impacts of benefits such as flexible working, study leave, bikes-for-work schemes, or any experiential or lifestyle benefit enabled by the employer, on peoples’ lives.

“Storytelling can really help bring to life the value and impact of all employee benefits,” Bennett says. “By promoting non-financial reward through a more social and impact-driven context, employers can ‘live’ their [organisational] values, create more meaning around reward provision and even inspire creativity and aspiration.”

Benefits have an important role to play in employee engagement and, therefore, in productivity and business results. Gallup’s State of the global workforce study, published in December 2017, found that those organisations with high engagement have 17% greater productivity.

As Corey concludes: “With the right communications strategy, and the right communication tools, [employers] can get it right. I’ve seen a huge difference in understanding and engagement just by bringing benefits together in one place, making it easy to find and use benefits.”

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