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WORKSPAN DAILY |

A True Total Rewards Philosophy Is More Important Than Ever

Editor’s Note: Workspan Daily will be reproducing a monthly Compensation Café blog post for the benefit of our readers and to encourage further discourse on topics vital to compensation professionals. New to WorldatWork? Please feel free to join the discussion in our Online Community or send your thoughts to workspan@worldatwork.org.

"Total rewards" makes a great title for an employee statement because it sums up what's on the page. Otherwise, it often seems that benefits fit more comfortably into the total rewards concept than compensation does. So why should compensation practitioners bother? After all, "total compensation" communicates its meaning clearly, why jam it into total rewards?

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When the term total rewards was introduced, it was thought that the overriding advantage would be to telegraph to employees that benefits had monetary value and should be viewed in the same way as compensation. Another advantage, of course, was to total up the financial value of all that the company does for employees in one category in employees’ minds. Also, that the natural outgrowth of a total rewards philosophy would be to organize all of the various HR services as one perceived whole, with HR functions working together in better coordination.

We've made real progress with the first and second goals, equating benefits with investment and financial value in employees' minds. However, HR seems to be lukewarm to promoting a shared brand, hauling it out inconsistently. But does it really matter?

Yes, more than ever this year.

With everyone in the dark about the future and overburdened by change, we are all feeling overwhelmed. In today's setting, HR needs to demonstrate respect for employees' time and attention more than ever before. A consistent, umbrella total rewards effort, with compensation playing an equal role with benefits, will help make communications and administration as simplified and streamlined as possible this year. This approach will also position you for a positive impact on engagement.

Think about how employees will react to seeing compensation, benefits and more communicated with a similar “look” and overriding themes. Odds are they will feel some real relief that there is a concise organization to end-of-year communications. Also, the coordinated approach will reassure them that their benefits and compensation remain valuable even in our current business climate. Plus, you can help them manage their time effectively by communicating a single total rewards calendar for benefits, performance management and total compensation.

Where do you start? With HR building a single operating calendar for open enrollment, performance management, raises, incentive awards and development planning. Make sure you include everything that is happening during those months—town halls, benefits fairs, wellness events, etc.—so you can notice and eliminate log jams. Then, step back and check whether everyone in HR can agree on the programs that should be included under the total rewards heading.

Once you have your shared context defined in that way, discuss how employees feel about each of the total rewards (and where their overall level of engagement is) — and how your executives feel, too. Use the range of data at hand to understand the attitudes and beliefs that employees bring to the table right now. (Not sure how to do this kind of analysis? Check out the DIY tips in this recent Compensation Cafe article.)

Next, agree on the “message platform” that will be used to develop total rewards communications. The messages summarize the unique value your total rewards bring to your employees and the characteristics that differentiate your total rewards from your competitors' programs. There should be no more than three to six overarching messages. Then another two or three for each component of total rewards. (Only allow yourself more if you are introducing changes this year.)

This message platform is shared throughout HR to build consistency into how you talk and write about compensation, benefits and so on. Improved consistency will bolster employee trust, as all communication from HR — no matter what function — should conform to the message platform. This is an especially valuable feature if your organization uses HR Business Partners or other decentralized channels of employee communications.

About the Author

Margaret O'Hanlon Bio Image

Margaret O'Hanlon, CCP, is founder and principal at re:Think Consulting and a founding contributor of Compensation Café.

This article was first published at Compensation Café on Aug. 6, 2020.