UK: Rebuilding Reward - In this Special Feature, We Look at the Relationships Between Businesses and Employees and Examine Ways to Motivate and Reward Them.

Last Updated: 6 July 2010
Article by Ian Luck

The six stages of reward

Up-to-date and flexible people practices are vital to support business objectives, but many businesses forget to review their reward approach as their business grows and changes. Here's our six-stage model to check that your reward systems are still up to the job.

1. Job roles

As organisations develop, the boundaries of many job roles are likely to blur. Effective job design and evaluation techniques will help you re-value them fairly.

2. Pay and grading

Check whether your pay structure is suited to your business structure. What is the impact of change on grades or levels? How has pay and career progression been affected?

3. Market data

As the economy starts to recover, keep your eye on market trends to reduce the risk of losing good people when the job market eases.

4. Benefits and incentive schemes

Are you getting the best rates for benefits? Now is the time to make sure you're getting real value for money – including re-broking benefits and re-negotiating bonus schemes.

5. Total reward package

Many staff don't know how much their benefits are worth. Tell them the total value of their reward package in clear and effective ways.

6. Equal pay compliance

If you change roles and reward structures, check that they will be applied fairly. For larger businesses, equal pay analysis will help you to test and benchmark the effectiveness of any changes.

Are you ready for the new 'fit notes'?

The Government has introduced a new Statement of Fitness for Work, known as a 'fit note', to replace GP sick notes. The new system gives more responsibility to the employer to make the final decision on fitness and what changes can be made to facilitate the employee's return to work. A guide for employers is available on the Department for Work & Pensions website

The benefits of flexibility

The recession has demonstrated to businesses of all sizes the importance of flexibility in employee benefits – both in their costs and effectiveness.

A well designed flex plan enables staff to build benefits packages that are meaningful to them, resulting in a more motivated and loyal team to help your business succeed. In the annual Employee Benefits magazine survey of flexible benefits arrangements, over a third of respondents said that their flexible benefits plan reinforced the corporate culture and business objectives within the firm. Research repeatedly shows that greater staff engagement has a positive impact on competitiveness and performance, irrespective of the state of the wider economy.

Of course, cost is also a critical factor, particularly for younger businessses, so it's encouraging to hear that 55% of companies in the Employee Benefits survey said that their plan had been effective in reducing or containing their costs.

While childcare vouchers, dental and other insurances and the ability to buy and sell annual holiday remain the most common benefits offered through a flex plan, it is interesting to note that some 48 different benefits were outlined in the survey. These ranged from bicycle loans and gym membership to wine club membership and discounted bus travel.

An exciting new development is the growing use of concierge services. These were previously the preserve of exclusive card membership schemes but can now be made available to all staff, helping them to manage many of their needs, from shopping and insurance to arranging a child's birthday party or finding an emergency nanny.

Checklist : Managing Sickness Absence

Practical advice on handling long and short-term sickness absence to stop it damaging your business.

  • Review your sickness policy to ensure it follows the rules requiring employees to report all absences and provide appropriate certification – enforce this rigorously.
  • Ensure you have processes to maintain regular contact with employees during absence.
  • Review your procedures for supporting employees back to work – ensure line managers carry out return-to-work interviews after every period of absence.
  • Keep clear records of all absences and the reasons. Set levels of absence that will trigger a formal review.
  • Examine alternative work you can offer employees.
  • Train and support line managers so they can comply with your sickness policy, carry out risk assessments and develop return to work programmes.
  • Consider a referral to an occupational health specialist, if the new fit notes don't provide sufficient information to enable you to make decisions about an employee's fitness to return to work, particularly if dismissal is a possibility.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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