Duncan Brown: Is total reward flexibility the wrong target?

Duncan Brown

Reward professionals have, quite rightly, been obsessing for many years about the need for greater flexibility, a desire which in fact drove the whole total rewards movement. Uniform market-identikit packages with a lack of innovation and no element of flexibility are limited in their perceived value, and restrict female and minority progression in employment.

Nevertheless, flexibility misses a more fundamental issue: how much is there to flex? Employees want more money, not more flexibility; they do not want a choice of which day they get paid on, they want, and many of them need, given that the rate of personal savings is at its lowest level on record, more pay.

Too often, the total reward concept has been used as an alternative to decent pay levels and increases and, even worse, as a front to cut benefit costs and shift risk onto employees. Today, the same plain-vanilla, copycat benefits choices and platforms are rolled out, supposedly to appeal to a more diverse workforce, even among well-meaning and genuinely good employers.

With the belated return in the economy to real-pay growth, the Institute for Employment Studies (IES) believes that there are signs of hope amid the gloom and Brexit uncertainty. Before employers provide yet more voluntary benefits, however, they must recognise that any effective total rewards package is based on the secure foundation of a decent base pay level, combined with providing all employees, especially the lowest paid, with real remuneration and career progression opportunities.

For employers genuinely seeking to address real employee needs, rather than simply picking up what the major benefits providers are offering them, we would highlight two areas for greater emphasis in 2019: mental health support and employee financial wellbeing.

Get pay and reward levels right first, then look at the choices.

Dr Duncan Brown is head of consultancy at the Institute for Employment Studies (IES)