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Looking to create a more engaging and comprehensive employee benefits program? Consider a total rewards program. This approach goes beyond the basics of salary and insurance to include perks like professional development, performance recognition, work-life balance, additional benefits, and compensation.
As recruiting and retaining workers remains uniquely challenging, total rewards programs are more important than ever. A February 2023 report from the U.S. Chamber of Commerce notes that quit rates and labor force shortages in lower wage industries remain stubbornly high. One top contributing factor to these challenges is employees feeling undervalued by their organization, and another top contributor is stress – with one report finding that 40% of job turnover is due to stress.
The most effective total rewards strategies or “total rewards” meet the needs of their employees by providing the recognition, flexibility, and financial security they are searching for. With this in mind, you can transform these challenges into opportunities for your business to decrease turnover and boost productivity by implementing a total rewards program.
But what goes into a comprehensive total rewards program? Understanding these five primary components of total rewards strategy is essential to creating a program that delivers results for your company. By focusing on the five key elements we’ve outlined, employers can improve employee engagement and satisfaction.
In this article, we’ll explore each of the five components of total rewards in-depth and provide practical strategies for implementing a successful program.
1: Professional Growth Opportunities
How can you help your employees grow and succeed? By providing opportunities for professional development – which is a crucial aspect of total rewards. According to Forbes, 20% of employees want to see their leaders actively supporting their training and development. Another study showed that 94% of employees would stay with a business longer if it invested in their careers. Businesses that invest in their team’s skillsets enhance employee satisfaction and secure employee retention.
Professional training initiatives can take on many different forms, from hands-on training to online programs. For instance, some businesses create mentorship programs that pair experienced team members with new hires to help them navigate their job. Others incentivize employees to pursue additional training outside of work. Each of these initiatives helps employees hone their skills and improve their competency, which ultimately benefits your bottom line.
Another way employers can motivate their team members to pursue management roles is by offering clear paths for growth and development. This can include regular performance evaluations, providing feedback, goal-setting, and other training opportunities that help employees understand how they can advance in their position. By doing so, employers help their employees and create a more skilled workforce that can drive long-term success.
2: Performance Recognition
Rewarding top-performing employees is an essential part of the five components of total rewards. Not only do rewards motivate employees to keep up the great work, they also create a positive work culture where hard work is appreciated and encouraged. In fact, 91% of employees agreed that they are motivated to work harder when they feel their efforts are recognized by leadership. The best recognition programs come in various forms, but they all aim to acknowledge and reward employees for their dedication.
One of the most effective ways to recognize employee performance is through monetary incentives, such as bonuses, reward cards or paycards. These benefits can be tied to specific performance goals that provide employees with clear targets to work towards. However, ensuring that these programs are fair and transparent is crucial so everyone feels valued and motivated.
Public recognition, including employee of the month awards, social media shoutouts, and announcements at team meetings, is another powerful way to acknowledge and celebrate employee achievements.
This shows appreciation for the individual’s hard work and highlights the behaviors and accomplishments that the company values and wants to promote. Plus, it’s an impactful way to build a positive work culture where everyone feels appreciated and recognized!
3: Flexibility and Work/Life Balance
3: Flexibility and Work/Life Balance
Finding balance between work and life is a common struggle for many employees, but it doesn’t have to be that way. When 59% of employees agree that flexibility is more important to them than salary, it’s time for your business to consider how you can accommodate these needs. Employers who prioritize flexibility and work-life balance as part of their total rewards package create a more productive team, with 81% of workers stating that a flexible work model would allow them to be more intentional with their time.
Flexible scheduling is a game-changer for employees juggling multiple responsibilities. With options like four 10-hour workdays instead of the traditional five 8-hour days, employees can carve out time for their personal lives without sacrificing productivity. Whether it’s taking care of their children or attending night classes, flexible scheduling empowers employees to prioritize their lives outside of work.
A hybrid work environment is the preferred model of 68% of employees. Long commutes can be draining and time-consuming, so the ability to work from home or a remote location can be a breath of fresh air when possible. Plus, it’s not just employees who benefit – according to one study, a hybrid work environment would increase team connection, relationships with leadership, team morale, and personal motivation.
4: Comprehensive Benefits
4: Comprehensive Benefits
When it comes to attracting and retaining top talent, offering a competitive salary is just the beginning. Small businesses or organizations in high-turnover markets may struggle to understand what perks they can offer employees outside of traditional benefits. Considering that a top reason employees quit is due to benefits, reviving your benefits package is more important than ever.
Consider offering health and wellness benefits to set your business apart from the crowd. Businesses who offer wellness programs also see a 72% decrease in healthcare costs. While medical insurance is important for everyone, offering additional perks for wellness programs like gym memberships, fitness classes, and health coaching show that your business is actually invested in employees as people and can reduce absenteeism by up to 19%.
For working parents, childcare benefits can be a high priority. 59% of organizations currently offer a flexible spending account for dependent care. If your company is part of those of organizations that don’t accommodate for childcare, it may be harder to retain and attract talent
Not only is childcare a concern for many workers, but about 24% of Americans born between 1957 and 1964 provide elder care as well. According to analysis from SHRM, “employers that don’t support caregiving risk a lot of turnover, meaning lost knowledge and skills, and shrink their potential hiring pool dramatically.”
Offering comprehensive benefits can have a significant impact on the overall success of your team. When employees feel valued and supported by their employer, they’re more likely to be motivated and productive at work. By investing in a comprehensive total rewards program, you’re not just creating a positive work environment – you’re building a loyal and dedicated team that will help drive your company’s success.
5: Competitive Compensation
5: Competitive Compensation
When it comes to keeping employees happy and motivated, competitive compensation is a crucial element of your total rewards strategy. Competitive compensation doesn’t just mean paying people a fair wage, or even increasing pay. In fact, there are many FinTech options that can provide financial benefits at low or no-cost to the employer. A comprehensive compensation package that includes incentives, benefits, and other financial rewards can make all the difference in employee retention.
Those reporting financial stress say they lose, on average, 11.4 hours in productivity every week–an amount that translates to more than $4 billion in lost productivity weekly for U.S. employers. Earned wage access (EWA) is an option that some employers are offering to combat productivity loss and stand out from competitors. This employer-sponsored program allows employees to access a portion of their earned wages before payday. EWA helps to alleviate the financial stresses of the many workers who may be a part of the 64% of Americans living paycheck-to-paycheck.
Reloadable paycards are prepaid debit cards that can be loaded with an employee’s wages. These paycards simplify the process of managing finances for the roughly 1-in-5 of workers who are underbanked or entirely unbanked. The benefits of EWA with modern FinTech and paycards provides your employees the most convenient process for accessing their wages.
Employers can create a more competitive and attractive total rewards program by offering a compensation package that includes a few of these different types of compensation. This, in turn, can help them retain their high-performing employees and build a loyal and engaged workforce.
The Five Components of Total Rewards: Answered!
The Five Components of Total Rewards: Answered!
Imagine having highly motivated and engaged employees who are dedicated to driving your business forward. That’s the power of a well-designed total rewards program. By offering a comprehensive package that goes beyond just a salary, businesses can retain their best employees while creating a positive work culture.
So, what are the five components of total rewards?
- Professional growth opportunities
- Performance recognition
- Flexibility and work-life balance
- Comprehensive benefits
- Competitive compensation
These are key to creating a successful program that meets the diverse needs of employees. By investing in these components, employers can show their commitment to supporting their workforce and creating an environment where employees feel valued and appreciated.
The benefits of a total rewards program extend far beyond just attracting and retaining employees. It can also help increase productivity, reduce turnover rates, and foster a positive work culture. By understanding the importance of each component and implementing them effectively, businesses of all sizes can achieve success and meet their goals.
So why wait? Start building your total rewards program today and watch your business thrive!
Juice’s innovative FinTech solutions go beyond the basics to offer a range of incredible low to no-cost employee benefits that would otherwise cost companies thousands of dollars each year.
By providing these additional perks, employers can enhance their employees’ financial wellness, leading to increased satisfaction and engagement. Learn more about Juice’s perks and benefits and more today!