With the evolving job market and increasing career opportunities, retaining talented and motivated employees necessitates a multi-faceted strategy. Today’s workforce doesn’t only expect a steady paycheck, they expect financial well-being from their employers. Thanks to innovative remuneration strategies and a whole new way of thinking about compensation, employees now have a more professional and beneficial relationship with their company.
According to a recent survey from Hays, the largest specialised recruiting firm in the world found base wage isn’t the only factor that most employees take into account when evaluating a job offer. Key determinants of how people feel about their jobs and employers include other compensation and benefits components. Not only does this impact their financial health, but it also influences their motivation, happiness, commitment, and performance towards the organisation.
Does fair compensation motivate employees and keep them engaged in their work?
The short answer is “yes”. The more equitable an employee’s remuneration is, the greater the likelihood that they will be motivated and enthusiastic about their work. Employees evaluate the adequacy of their remuneration in relation to the market rate for their competencies, experience and skills.
According to a study done by the Society for Human Resource Management (SHRM), there is a clear correlation between companies that have well-defined and successfully implemented pay policies and those that regularly meet their strategic objectives. In addition, fair compensation and benefits also create a relationship of trust between the employee and the employer. When there is trust between the two parties, it can result in a stronger working relationships, which in turn will enhance overall performance. Having both parties in an agreement can have a positive impact on the overall success of the organisation.
In this article, we will explore the multi-faceted relationship between compensation and employee engagement, examining how competitive salaries, robust benefits, and strategic remuneration strategies foster a workforce that remains loyal, and engaged.
Coordinating salary and organisation values
While salary and benefits are the main subjects of this article, it is important to note that these figures should not be taken in isolation. According to a recent survey, 47% of people who are actively searching for a new job say that one of the most important things they’re looking for in an employer is company culture.
We strongly believe that an organisation’s values should also be reflected in the compensation strategy. The concepts of fairness and integrity should be applied to and demonstrated through remuneration and all other appropriate benefits.
Making pay packages tailored to employee needs
Personalisation is at the heart of today’s workforce. It is the process of understanding the individual, identifying and comprehending their motivations and what drives them to delivery their full potential. Flexible compensation allows organisations to respond to the diverse needs and preferences of their employees.
Whether it’s customised benefits or flexible pay plans, flexibility in compensation recognises the diverse needs of employees at different stages in their journey with the organisation. This strategy makes employees feel appreciated and understood, which leads to increased job satisfaction and retention.
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The effect of competitive salaries
Fair pay is at the core of any compensation strategy. A competitive salary not only ensures that employees are compensated adequately for their efforts, but also establishes a foundation of trust between an organisation and its employees. Fair pay allows workers to focus on their jobs without feeling overly stressed out about their personal finances, which eventually leads to improved productivity and commitment.
Employee benefits: More than just a paycheck
Competitive salaries are only the starting point; however, a comprehensive employee benefits package is essential for a successful compensation & benefits strategy. This includes comprehensive employee benefits, such as health insurance and retirement contribution, as well as wellness programs. These perks promote a feeling of community and sustained loyalty among employees by highlighting a company’s dedication to their general well-being.
What People Want survey conducted by Hays US found that three-quarters of businesses provide health and dental insurance, and two-thirds provide 3+ weeks of paid vacation. Employees are more willing to invest themselves in the success of the organisation if they feel valued by their employer.
Incentives and rewards for excellence in performance
Look beyond the realm of paying just the salary to your employees. Offering incentives and rewards can be a great way to get people to work smarter and do better than they would if they were paid a fixed salary. A great way to recognise and celebrate the success of employees is by providing performance-based bonuses, profit-sharing, and recognition awards that help create a motivating work environment for employees.
Not only do these perks give you tangible rewards, but they also show that you’re valuable to the company, which makes you feel proud and excited to be part of the team. It is also important to reward for retaining some of your best employees. It is essential to recognise the hardworking employees whose work is important but maybe not as well-known.
Improve employee engagement with Zalaris’ Compensation & Variable Pay Solution
A growing emphasis on fair pay and benefits is impacting businesses of all sizes and sectors. 62% of organisations that claim to pay their employees fairly also claim to have a high level of employee engagement.
Organisations can take advantage of Zalaris’ unified, cloud-based, compensation management solution to assist HR teams in streamlining their budgets. Zalaris’ solution is equipped with built-in intelligence that offers recommendations on how to optimise the use of limited budgets, as well as insights on how to allocate resources strategically across the organisation while adhering to budgets.
Feel free to get in touch with our solution experts to learn more today.