How reward and benefits can support diversity, equity and inclusion strategies

From five generations in the workforce to ethnic diversity steadily increasing across the UK, many workplaces are more diverse than ever before. In this context, taking a one-size-fits-all approach to reward and benefits will fail to deliver maximum impact for both individuals and organisations. However, according to Shakil Butt, founder of HR Hero for Hire and author of the book Equity, Diversity and Inclusion Explained, many employers fall into the trap of offering standardised benefits “designed around office-based, full-time, neurotypical or non-disabled employees”. Often, the link between diversity, equity and inclusion (DEI) and reward and benefit starts and ends with gender pay gap reporting compliance, he adds.

“Pay gaps are not a bad starting point, but that’s all they are,” he says. “Wider reward and benefits approaches can be fundamental to DEI strategy, but unfortunately DEI is often done as an afterthought, not seen as business critical. The reason most employers opt for standardised reward and benefits is because they are easier to administer. But this fails to take into account that we all need different things at different points in our life and careers, because we are all different.”

Employee expectations 

Employees increasingly expect a more personalised and inclusive approach across all aspects of work, including benefits. YouGov’s Surveys: Serviced  survey, published in March 2023, found 66% of working Britons said inclusion was important to them when considering job opportunities. Katie Hart, talent acquisition and experience lead at Perkbox Vivup, says: “The expectation has grown significantly in recent years. The shift towards more personalised, flexible benefits has picked up pace. Employees expect their employer to understand them as individuals, not just as a collective.”

When it comes to designing an inclusive benefits proposition then, employers need to take a deliberate approach to engaging with diverse voices across the organisation to ensure any package is fit for purpose. Nebel Crowhurst, chief people officer of Reward Gateway, says: “[Critically], HR should avoid making assumptions, as this is often where we end up putting benefits provisions in place which have no or little uptake, resulting in a waste of valuable budget.”

Charles Cotton, senior pay and reward advisor at the Chartered Institute of Personnel and Development (CIPD), advises conducting regular surveys and focus groups to assess whether all employees are aware of the benefits available and whether these are appropriate and equitably accessible. “Employers should consider conducting regular [DEI] audits and inclusion impact assessments across benefit offerings,” he says.

HR teams should also actively engage with employee resource groups (ERGs) to co-design benefits that are relevant and inclusive, ensuring those with lived experience have a voice in shaping the offer, he adds.

Understand demographics 

It is also key to make use of demographic and health data to inform inclusive design, says Lucie McGrath, European health, equity and wellbeing leader, health and benefits at Willis Towers Watson (WTW). “A critical component is to understand the health data of the organisation and consider health risks that need to be targeted and addressed,” she explains. “Employee demographics, such as age and gender composition, form an important part of this analysis, as employers need to understand specific gender or age-related health issues that may be more prevalent and should be targeted accordingly.”

Experts agree that there are several hallmarks of an inclusive benefits offering: being flexible, clearly defined and personalised, offering support for people at different life stages and considering how needs might vary by factors like age, gender, ethnicity, health and caring responsibilities.

“It should consider how different personal characteristics or identities intersect, including characteristics protected under the Equality Act,” says Cotton.

Elements could include gender-inclusive or equal parental leave, benefits tailored for neurodivergent individuals, menopause support, flexible working and leave options, floating holidays, that is giving people the option to use holiday for cultural or religious holidays, and specialised mental health support.

“There’s a real need for equity over equality in benefits to address diverse needs,” says McGrath. This means that employers must engage with vendors to ensure all benefits are fully accessible, asking questions such as whether communications and guides are available in braille, audio and sign language and whether treatment facilities are accessible for wheelchair users. Technology like bionic reading can help neurodiverse employees access written documents.

“Benefits accessibility information should be clearly displayed to the full workforce to give peace of mind that benefits can be used conveniently at a time of need, without there being a burden on individual employees to research accessibility features themselves,” McGrath adds.

Inclusivity costs

Creating a truly inclusive proposition does not come without its challenges. “One of the biggest challenges is budget,” Hart says. “Creating a package that works for everyone isn’t cheap, especially if you’re trying to keep pace with changing employee expectations.”

WTW data backs this up: its latest Benefits trends survey, published in March 2025, found that cost was the top issue influencing 64% of UK employers’ benefits strategies in 2025, up from 57% in 2023.

Creating a more inclusive offering could potentially make some groups feel they are now getting less, making clear and empathetic communication vital, adds Hart. “It’s important to communicate the why behind choices, and keep reminding people that equity isn’t about giving everyone the same, it’s about giving people what they need,” she says. “The solution lies in clear, ongoing communication and a deep understanding of your people, backed up by data.”

It has been hard to miss the current backlash against DEI, including the ripple effect caused by US president Donald Trump’s vocal attacks and the subsequent roll-backs of diversity programmes in high-profile US businesses such as Meta and Amazon. While the situation is less extreme in the UK, there are nonetheless areas of contention, such as the recent Supreme Court ruling that the legal definition of a woman is based on biological sex and the questions this raises for both trans inclusion and the inclusion of gender critical beliefs under the Equality Act.

However, according to a 2025 survey by Culture Amp, most UK organisations are holding firm in their commitments to DEI. Published in February 2025, its survey of more than 1,000 organisations found that 74% still had a DEI programme, with 26% having increased funding compared to the previous year and 33% having the same budget. Despite indications that some employers may deprioritise wider DEI initiatives there is, so far at least, little evidence that this is impacting reward and benefits approaches, says Cotton.

Tailored reward 

Inclusive benefits could be more immune to any backlash. “Taking an individualised approach to reward and benefits has the potential to go beyond being viewed as another DEI initiative,” says Butt. “Everyone could benefit from having tailored packages that mirror their needs so they are less likely to face push back or being labelled as woke.” 

Accusations of wokeness aside, having an inclusive offering makes a huge difference when it comes to attracting and retaining talent, says Hart. “When benefits feel personal and relevant, they become a powerful signal of appreciation, and that contributes massively to culture,” she adds. “Inclusive benefits can also build stronger engagement and loyalty.”

Ultimately, Crowhurst says: “people want to feel like they are recognised as an individual in the workplace, not just a number”. An inclusive benefits offering could be one of the most powerful ways of achieving that.