The Undeniable Impact of
Total Rewards on Employee
Connections
Research Spotlight
Our latest research study revealed several key drivers of employee connection at work, including positive team and manager interactions, comprehensive total rewards, and others. Overall, Connected Employees encounter these positive drivers more than their Disconnected counterparts, resulting in greater trust, engagement, and retention. We also found that key differences between Connected and Disconnected Employees are the result of one thing: the quality of their employee experience.
This research spotlight confirms the distinction between Connected and Disconnected Employee experiences, including how they view total rewards. We’ll discuss the importance of total rewards, how those rewards affect employee connections, and what organizations can do to refine total rewards offerings for maximum benefit.
We asked 400 full-time employees how they felt about their experiences at work in a 15-minute quantitative survey. The survey was conducted from June 15–19, 2023. All respondents work in organizations of 1,000+ employees and are at the level of VP or below.
Overall margin of error of +/- 4.9 percentage points at 95% confidence level.
The attitudinal segmentation was exclusively based on ratings of attitudinal statements. Neither the number of segments nor their defining attitudes were predetermined. All resulted organically from a purely mathematical analysis. Each segment represents a group of respondents for whom a particular set of attitudes is strongly connected.
A visualization of the data is available here.
Today’s Total Rewards Landscape
As total rewards offerings have expanded beyond pay and health
benefits, organizations now have more ways to support employees’
overall well-being. Today, total rewards can include any combination of:
-
Cash and equity compensation
-
Healthcare benefits
-
Time off (e.g., vacation, sick leave, etc.)
-
Non-traditional perks, such as gym
memberships and home office equipment
-
Recognition
-
Workplace flexibility
-
Employee well-being programs
-
Training, coaching, and other forms of professional development
The value of total rewards on the employee experience
can’t be understated. Research has found:
4
Employees who say recognition is an important part of their work experience are nearly four times more likely to feel connected to their organization’s culture.1
6
Employees are six times more engaged when their rewards meet their needs.2
66
Two-thirds of employees say their current benefits package makes them more likely to remain with their employer.3
Given the positive effects of total rewards on organizations and
employees, it’s critical to understand which benefits and rewards
employees value most and which have the most significant impact
on the employee experience.
The Link Between Total Rewards
and Employee Connections
Few would argue the importance of an effective total rewards
strategy. The following research findings shed light on just how
sizable the impact of total rewards can be.
Key finding number 1:
Total Rewards
Are One of the Most
Critical Drivers of
Employee Connection
We asked employees what helps them feel more connected to their organization, and they cited recognition (#1) and total rewards (#4) more often than most other options.
Certainly, other elements of the employee experience have value, but without comprehensive total rewards, employees are likely to have difficulty feeling connected to the organization.
What helps you feel connected to your organization?
Being praised/recognized
for my contributions
0
Collaborating with others
0
Team meetings
0
Comprehensive benefits/
total rewards
0
| Having options for career advancement within the organization | 30% |
| One-on-one meetings with my direct manager/supervisor | 30% |
| Becoming friends with coworkers | 28% |
| Believing in the organization’s mission and vision | 28% |
| Celebrating wins | 26% |
| Team-building events | 25% |
| Performance reviews | 24% |
| Everyday “water cooler”- type interactions with coworkers | 23% |
| Casual interactions with other departments/teams | 23% |
| Lunch with coworkers | 22% |
| Shared values | 21% |
| Company meetings/events/all-hands meetings | 20% |
| Learning and development/training programs | 20% |
| Meetings with other employees | 20% |
Key finding number 2:
Employees Value Total
Rewards But Don’t
Know of Everything
Available
Most employees (72%) say total rewards are extremely important or essential, but only 42% know all the rewards and benefits available to them.
Of all the benefits they receive, employees place the highest value on health and retirement benefits, time off, and a competitive salary. Interestingly, remote work ranks higher than most other benefits and rewards, including bonuses and incentive pay. Despite the rise in return-to-office (RTO) policies, employees still count remote work as one of their most valued benefits.
Which of these are most valuable to you?
Health insurance
0
Paid time off (PTO) (including
bereavement, vacation, sabbaticals, etc.)
0
Competitive salary
0
Retirement program
(including employee match)
0
Remote work
0
| Flexible schedule | 51% |
| Bonus program | 49% |
| Dental insurance | 46% |
| Unlimited vacation | 45% |
| Vision insurance | 35% |
| Other benefits | 33% |
| Long-term incentive pay (stock options, performance shares, etc.) | 33% |
| Employee recognition programs (awards, appreciation lunches, etc.) | 24% |
| Life insurance | 23% |
| Sabbatical | 22% |
| Leadership coaching | 20% |
| Wellness programs (meditation, gym access, employee assistance programs (EAP), etc.) | 19% |
| Short-term incentive pay (sales-based bonuses, etc.) | 18% |
| Disability insurance | 17% |
| Job training | 14% |
| Financial planning and education | 13% |
| Mentorship program | 11% |
| Childcare | 11% |
| Family planning services (adoption assistance, infertility treatment, new parent support, lactation coaching, abortion access/support, etc.) | 11% |
| Transgender-inclusive healthcare coverage and support | 10% |
| Parental leave | 9% |
| Tuition reimbursement | 8% |
| Peer-to-peer recognition programs | 7% |
| Menopausal support | 7% |
| Student loan repayment | 7% |
| Pet insurance | 6% |
Key finding number 3:
Employee
Connection
Increases with Total
Reward Variety
Connected Employees are significantly more likely to say their organizations offer a range of total rewards and benefits. This trend exists across nearly every benefit we listed, suggesting that organizations offering a breadth of benefits will have more Connected Employees.
Which of the following does your
organization offer its employees?
- Connected Employees
- Disconnected Employees
Health insurance
Dental insurance
Paid time off (PTO)
Vision insurance
Life insurance
Retirement program
Remote work
Employee recognition programs
Flexible schedule
Competitive salary
Disability insurance
Wellness programs
Parental leave
Tuition reimbursement
Job training
- Bonus program
- Long-term incentive pay
- Financial planning and education
- Family planning services
- Peer-to-peer recognition programs
- Short-term incentive pay
- Leadership coaching
- Mentorship program
- Pet insurance
- Transgender-inclusive healthcare coverage and support
- Childcare
- Sabbatical
- Student loan repayment
- Unlimited vacation
- Menopausal support
Key finding number 4:
Employee Connection
Is an Outcome of Total
Rewards (But Not the
Only One)
Of the many positive effects of total rewards, employees
most frequently say their benefits and rewards:
-
Make them want to stay
-
Give them a better work-life balance
-
Make them feel valued
-
Make them feel grateful
Not surprisingly, employees have different
attitudes about the impact of total rewards.
Connected Employees are much more likely to cite the positive benefits of receiving the total rewards their company offers.
How does having rewards other than basic benefits like healthcare
impact your experience at work?
- Connected Employees
- Disconnected Employees
Notably, “Feeling connected to my organization” falls lower on the list, confirming a consistent finding in our research: total rewards are only one of the many necessary components of a connected employee experience.
How to Improve Employee
Connections with Total Rewards
Most organizations see the value of total rewards and already offer a breadth of benefits to improve the employee experience. But what else can organizations do to use total rewards as an effective tool for improving employee connections?
Number 1: Test new methods for
understanding employees’
total rewards needs and
preferences
As employee expectations continue to evolve, there will always be new benefits to consider. To better understand different employee needs as they change over time, organizations should:
-
Gather employee feedback via surveys, Employee Resource Group (ERG) discussions, and other employee forums.
-
Audit total rewards offerings to ensure they keep pace with employee ages and family situations.
-
Routinely benchmark and explore new total rewards trends.
-
Explore AI and predictive analytics tools that enable more personalized benefits recommendations to employees.
Number 2: Align Internal
Communications and HR
benefits messaging
Internal Communications and their creative partners are critical in bringing HR programs and employee benefit plans to life. These communications can range from recurring celebrations (e.g., Employee Appreciation Day) to total rewards messaging campaigns that boost employee awareness of available benefits.
Other examples include:
- Employer brand campaigns
- The company intranet
- All-hands meetings
- Conversations with company ERGs
- Annual compensation and benefits statements
- Interactive total rewards learning tools
- Personalized reminders
- An employee total rewards chatbot
Number 3: Explore new total
rewards options
As our research shows, employees value some benefits even more than pay. To offer employees more of what they value, organizations should be open to considering new benefits and rewards that may be a better match for the current workforce.
Examples include:
- Student loan repayment assistance/family college assistance
- Menopausal care
- Intern housing and transportation assistance
- Volunteer time off
- Gender reassignment support
- Travel and work-from-home stipends
- Expanded parental leave
- Pet insurance
- Sabbaticals
Do More With Your Total
Rewards Program
Leveraging the many elements of total rewards is one of the best ways to show employees the organization cares about their development and well-being. By exploring new ways of offering and communicating total rewards, it’s possible to achieve greater employee retention, engagement, and connection.
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About Ingenuity Design
We’re an Employee Experience agency that strengthens companies from the inside out. We advise and create value-driven employee experiences across the employee lifecycle to help make companies great places to work. We’re proud to work/have worked with eBay, TD Bank, Splunk, Visa, Gap Inc, and Thumbtack, to name a few.
About Audience Audit
Audience Audit helps marketing agencies build ROI and reputation based on original thought leadership research. Founded in 2009, the firm has conducted audience research for hundreds of agencies and their clients.