Harnessing the Untapped Potential of Total Rewards

  • Author: Meghan Stewart

While total rewards play a critical role in helping organizations attract, retain, and engage talent, some may not be taking full advantage of the value they bring to the employee experience. However, by executing a targeted communication strategy and offering benefits that better align with employee needs, your organization can realize the many benefits of total rewards.

How Total Rewards Improve the Employee Experience

Total rewards help companies hire competitively and build a reputation as a great place to work. Moreover, many rewards can be tailored to meet employees’ specific needs, creating an environment and culture where employees feel more motivated, engaged, and valued.

Here are some of the ways total rewards improve the employee experience:

Helps Employees Feel More Connected

For the second year in a row, our research found that rewards and recognition play a significant role in helping employees feel more connected to their work, team, and employer. And it’s not just traditional rewards like compensation and health benefits that employees value. This year, the employees we surveyed said recognition was the number one aspect of their work life that helped them feel connected at work.

Improves Employee Engagement

Fulfilling employees’ needs for pay, recognition, and career development helps them feel more motivated to give their best effort at work. Research by Quantum Workplace found that employees are nearly three times more likely to be highly engaged when they know they’ll be recognized for their work. 

Reduces Turnover

Employees will be less likely to feel the need to leave for something better if their current employer provides competitive and equitable pay, benefits, and growth opportunities. And as the organization keeps pace with employees’ total rewards needs, employees may be more likely to feel satisfied in their roles.

Supports Employee Development 

Training programs, mentorship, career pathing, and other forms of professional development help employees develop skills that support their career advancement. Though these types of rewards benefit all employees, they are particularly helpful to early-career employees still learning to master technical and soft skills.

Improves Employee Wellbeing and Work-life Balance

Having some choice in where and how they work empowers employees, helps them balance their work and non-work lives, and supports their productivity. In fact, providing workplace flexibility as part of a comprehensive rewards package is so critical to employees that many value it more than pay. In one global survey, 52% of employees said they would take a 20% pay cut in exchange for a lifestyle that prioritized their quality of life. 

Three Ideas for Maximizing the Value of Total Rewards

Given all the benefits, it’s no surprise employers remain committed to offering a robust employee rewards program. Here are some ideas you may want to incorporate into your total rewards planning:

1. Educate employees about total rewards

Our latest research found that most employees value total rewards, but less than half know everything their employer offers. Some impactful ways to increase employee awareness include giving employees personalized total rewards summaries, creating a 24/7 total rewards portal, and holding informative lunch-and-learns. We recently helped one client develop a new total rewards communications strategy and messaging platform to increase prospective and current employees’ understanding of available benefits.

2. Keep rewards equitable and fair

One of the most glaring total rewards inequities is the gender pay gap, which many companies are still working to address. However, other rewards should be monitored for equity and fairness. For example, when providing family leave, adoption assistance, and other benefits to employees with families, it’s essential not to forget single employees. You can do this by offering benefits such as lifestyle spending accounts, sabbaticals, and expanded leaves that include loved ones who may not be immediate family members.

In addition to annual compensation benchmarking, staying abreast of other tools and solutions that could improve your organization’s total rewards offerings is critical. For example, AI and predictive analytics tools make it easier for companies to analyze market trends and give employees personalized health and benefits recommendations.

As employee preferences and new technologies evolve, there will likely be more opportunities to leverage total rewards for a better employee experience. Follow us on LinkedIn for more insights, and stay tuned for the launch of our upcoming research spotlight: The Undeniable Impact of Total Rewards on Employee Connections.

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