We were delighted to sponsor E-Reward’s annual sell-out conference for compensation and benefits leaders 2018 last week. Our team thoroughly enjoyed listening to the speakers at the annual conference, covering a whole host of topics to give delegates a clear picture of what is happening in the industry today and provide a forecast for tomorrow. Transparency and fairness in pay, new ways of working and workplace wellbeing were top of the agenda for the fascinating talks held across the two-day conference.
Here we discuss our key highlights from the event’s discussions and the insights that really resonated with our experience in working with our customers.
Changing workforce demographics
Benefex’s Founder Matt Macri-Waller discussed the importance of employee experience. Experiences shape conversations and activity on social media, being the driver behind 80 per cent of what people talk about. Experiences and how you make people feel is what people remember.
“I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel” – Maya Angelou
Bringing communications to life is key to memorability. 24 per cent of payroll is spent on benefits so creating an experience around reward increases both uptake and appreciation of what’s on offer. In terms of remuneration, Culpepper’s directors Stephanie Friedman and Stacey Morgan discussed the rise of crowdsourcing and how this is emerging in the context of salary benchmarking; guiding us on how to manage employee use of public, and often free sources of data, which too often fail to provide a robust methodology to inform and accurately shape pay practices.
People focus and recognition
The dynamics in the workplace are being driven by different generational values. Head of Employee Share Ownership at Proshare Gabbi Stopp discussed the implication of 57 per cent of the workforce being millennials (born 1980s) by 2020. This generation tend to want recognition and to believe in an organisation’s purpose. The focus on positive contribution and praising good behaviours in line with an organisation’s values encourages these practices to flourish. The idea that senior HR, managers and leaders should be ‘recognition coaches’ to promote this focus, publicly and in writing, was backed up by Michael Levy from Rewards.com. The culture of recognition need not cost anything, but Michael argued it can lead to 15 per cent extra discretionary effort from employees – “where the magic happens”.
Recognition including timely feedback from managers, ongoing conversations and increased opportunities to lead projects are more effective motivators than cash rewards according to Michael Rose from Rewards Consulting. Julia Hanna and Samantha Gee from Verditer Consulting built on this by promoting a transparent pay system across organisations in the context of establishing a culture of trust and engagement. Continuous feedback and alignment between reward, corporate strategy and execution in the context of sales compensation was also explored by Anaplan’s Zane Koeller.
New CEO pay ratio requirements
The extended remit of remuneration committees and the general attention being paid to wider workforce pay is being driven by the continued fair pay initiatives, which will include reporting requirements around CEO pay. This is on the horizon from 1 January 2019 and is something we have started to support employers in preparing their data for.
Partner at Ernst & Young, David Ellis expects many companies to go above and beyond minimum disclosure and produce additional analysis and graphs to contextualise information. Key considerations will include understanding high level principles affecting pay in organisations in the context of the external executive pay market, whether pay progression reflects a fair and balanced view of roles and accountabilities, whether the approach is consistent with the organisation’s stated values and culture and whether the rationale will resonate with communities in which the employer operates and with their employees. Professor Stephen Perkins also discussed CEO pay from a social constructionist perspective and the need for the total reward package to be balanced. For example, incentives have noticeably been scaled back in the banking industry to avoid perverse risks being taken.
There has been exponential growth in workplace wellbeing investment which is finding its way onto the C-Suite’s agenda. There is a better understanding of the link between productivity and health. The Wellbeing Leader’s director Evan Davidge spoke about the four dimensions of wellbeing: emotional, physical, social and financial. A rigorous focus on employee wellbeing is business-critical, providing emotional, financial and competitive advantage for organisations.
This is an exciting, rapidly developing area of HR which is seeing increased employee empowerment, integration with wider people strategies and the wider use of technology (wearables). A holistic view of wellbeing drives down non-communicable diseases (diabetes, coronary artery disease, back pain, hypertension and cancer) which are driven by poor behaviours such as diet, smoking, insufficient sleep, poor stress management and physical inactivity. Financial wellbeing is also pivotal to employee wellbeing, as co-founder of Smarterly Phil Hollingdale highlighted the fact 16 million people in the UK have less than £100 in savings; 78 per cent of employees believe that having a savings nest egg would help their everyday stress levels.
We look forward to the next year’s conference already – follow #Ereward2018 for further updates about the event and follow us @Paydata_Ltd to join the conversation about these emerging trends.