Looking beyond pay and career progression to boost retention

The benefits of a successful reward strategy are well-known. They are useful in creating culture and of course, retaining staff. Many argue that a total reward strategy is a useful recruitment tool as well.

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However, a recent study by the Institute for Employee Studies (IES) revealed that many feel “glitzy reward packages obscure the real needs for the workplace”. I would argue that this statement is not entirely true – reward packages help with recruitment and retention and that they are necessary for organisations to stand out amongst their competitors.

People say they want career progression and a good baseline salary, but industry salary benchmarks are usually the same across the board. Career progression only works if you are in a large enough organisation to keep employees on a steady role progression, and so it’s less effective for SMEs.

More often than not, those “glitzy” programmes are what gives companies the edge and helps them to create culture around the business.

Making reward work
Here are five reasons why, in my opinion, saying that employers are masking the need for “better baseline pay with the same plain-vanilla, copycat benefits choices” is wrong:

Salary isn’t enough - Salary benchmarking means competitors are offering similar or the same salary. Over recent tumultuous years, salary is stagnating compared to cost of living increases.
Keep it simple – Overcomplicating your benefits package to try to meet a range of employee needs is unnecessary and creates excess administration issues. Keeping it simple can be as easy as choosing an employee reward programme that offers a range of benefits to meet your teams’ needs across age, gender and diverse backgrounds.
Meeting needs – Employee input into reward programmes is a useful tool to understanding the drivers for productivity. Whilst salary is a baseline for a job, reward programmes send messages about your business and what your values are.
Focus on implementation – It’s often the delivery of reward programmes that causes criticism. Usually costs, board approval and training in new processes are the focus of a new programme. Instead, put some time aside for developing implementation procedures.
Evaluate effectiveness – Often many reward programmes are expensive initiatives and it’s up to the operations or administration teams to show the results of such a programme. Providing both management and teams with monthly reviews backed with usage metrics and analytics helps explain which rewards are most popular and why.

Finally, we have to place the role of salaries in the current hiring environment. While we have seen upward pressure on pay in the run up to Brexit, some - like the recruiter Robert Walkers - are suggesting the impact of the UK’s departure from the EU will be to keep salaries static. This is where I agree that salary is an important factor in retention

With the uncertainty of the UK’s economic future, and the belief by many employees that companies do not offer competitive salaries in the first place, the only real way we can impact recruitment and retention is through improving softer benefits like reward programmes, positive work culture and flexible working patterns.

We should be thinking of creative ways to keep our younger employees in the UK, as many opportunities may be opening abroad with larger companies moving over to Europe and beyond. Reward programmes could be at the forefront of this thinking.

Maintaining an inclusive reward programme culture which encourages employee engagement, whilst keeping board members in the loop, is a way forward for retention and recruitment. Unfortunately, salaries themselves are not enough of a carrot to dangle in front of the best candidates or to keep them with your organisation in the long term.

The author is Andy Philpott, sales and marketing director at Edenred UK.

This article was provided by Edenred UK.