Cavelle Joseph – St. Omer SHRM-SCP, MBA, B.Sc.

Pres­i­dent, HRMATT

Se­nior HR / IR Ex­ec­u­tive

Lead­ers across all sec­tors (Gov­ern­ment, Busi­ness and Union) and work­ers, spend a lot of time talk­ing about per­cent­ages and mak­ing the salary struc­ture com­pet­i­tive, and with good rea­son. Com­pen­sa­tion is key to em­ploy­ee re­ten­tion. If one firm in your in­dus­try is of­fer­ing a 15 per cent pay in­crease to their staff, then your em­ploy­ees in your or­gan­i­sa­tion are go­ing to feel sore­ly tempt­ed to seek em­ploy­ment there.

Per­cent­age in­crease and com­pet­i­tive salaries are an even greater con­cern right now. Peo­ple every­where feel un­set­tled af­ter the pan­dem­ic, and many work­ers are think­ing about a job change, ca­reer change and you are even hear­ing talk about mi­gra­tion. Yet, most em­ploy­ers need to think about busi­ness sus­tain­abil­i­ty, which means that they are not in a po­si­tion to of­fer every­one an enor­mous raise (per­cent­age in­crease).

For­tu­nate­ly, com­pen­sa­tion is not just about salary and it is time to shift the nar­ra­tive. Em­ploy­ers of­fer val­ue that goes be­yond a month­ly pay­check, and these ben­e­fits are col­lec­tive­ly known as the To­tal Re­wards pack­age. But what do you un­der­stand that to mean?

To­tal re­wards is the sum to­tal of all tan­gi­ble and in­tan­gi­ble ben­e­fits avail­able to each em­ploy­ee. Salary and ben­e­fits are the two main com­po­nents of a to­tal re­wards pack­age, as well as things such as train­ing, de­vel­op­ment, recog­ni­tion, child care so­lu­tions, group life and health in­sur­ance, em­ploy­ee as­sis­tance pro­grammes, gym fa­cil­i­ties, health and well­ness pro­grammes and flex­i­bil­i­ty.

You can place an ob­jec­tive dol­lar amount on some of these re­wards. For ex­am­ple, health in­sur­ance is clear­ly priced. So is child­care so­lu­tions, which em­ploy­ees can save mon­ey on if they have a flex­i­ble work­ing sched­ule or if their em­ploy­er pro­vide af­ter school cen­tres or day care fa­cil­i­ties.

Oth­ers might be a lit­tle hard­er to eval­u­ate. If you give an em­ploy­ee a chance to gain on-the-job ex­pe­ri­ence, to work on com­mit­tees, to at­tend con­fer­ences and you ac­knowl­edge their hard work, you are in fact in­creas­ing their chances of earn­ing a pro­mo­tion some­day, which will even­tu­al­ly mean a high­er salary. While it may be hard for many to es­ti­mate the val­ue of these re­wards to­day, they will un­doubt­ed­ly have a ma­te­r­i­al ben­e­fit in the fu­ture. And some con­sid­er­a­tion must be giv­en to that when we talk about com­pen­sa­tion.

To­tal re­wards in hu­man re­source man­age­ment is an ap­proach to as­sess­ing the val­ue of all of these re­wards. By look­ing at the val­ue of all avail­able re­wards, you can give em­ploy­ees a clear idea of their com­pen­sa­tion. It is not just the ba­sic salary nor a per­cent­age in­crease.

There are five main com­po­nents of a to­tal re­wards pack­age for em­ploy­ees that every­one should be aware of:

(1) Com­pen­sa­tion / Salary: This in­cludes base salary, com­mis­sion, in­cen­tive pay, bonus­es, and op­tions.

(2) Ben­e­fits: em­ploy­ees should pay close at­ten­tion to the core ben­e­fits pack­age such as health in­sur­ance, paid time off, well­ness pro­grams, and re­tire­ment / gra­tu­ity plans. Some com­pa­nies al­so of­fer rel­e­vant ben­e­fits such as le­gal sup­port, em­ploy­ee as­sis­tance pro­grams (EAP), com­pet­i­tive loan rates, car loans, ed­u­ca­tion loans com­put­er loans at be­low the mar­ket in­ter­est rates.

(3) Work-life flex­i­bil­i­ty: Some em­ploy­ees had ac­cess to flex­i­ble work­ing arrange­ments pre-pan­dem­ic. The pan­dem­ic forced many oth­er em­ploy­ers to be­come more flex­i­ble, which hap­pened in the form of wide­spread re­mote work­ing and flex­i­ble week­ly sched­ules. Flex­i­bil­i­ty has tan­gi­ble ben­e­fits, like mak­ing it eas­i­er to man­age child­care and ed­u­ca­tion. Al­so, re­search has shown that most work­ers say that flex­i­bil­i­ty is ben­e­fi­cial to their over­all well-be­ing.

(4) De­vel­op­ment: Fi­nan­cial sup­port for ed­u­ca­tion and cer­ti­fi­ca­tion is a tan­gi­ble ben­e­fit with a pre­cise dol­lar val­ue. Em­ploy­ees can al­so ben­e­fit from oth­er to­tal re­wards com­po­nents like men­tor­ing, job shad­ow­ing, job ro­ta­tion, job en­large­ment, in­ter­na­tion­al as­sign­ments and get­ting to work on chal­leng­ing projects.

(5) Recog­ni­tion: In­cen­tive bonus­es of­fer a di­rect ben­e­fit to hard-work­ing em­ploy­ees. How­ev­er, there is al­so great val­ue in an of­fi­cial “thank you” from se­nior man­age­ment. Recog­ni­tion of­fers demon­stra­ble proof that the em­ploy­ee can ex­ceed ex­pec­ta­tions – some­thing that will help them when they seek a pro­mo­tion in the fu­ture.

Al­though these have al­ways ex­ist­ed in the work­place, they have of­ten been tak­en for grant­ed and man­aged in iso­la­tion. Not on­ly that, when con­ver­sa­tions about com­pen­sa­tion be­gin, these el­e­ments of the to­tal pack­age are of­ten left out of the nar­ra­tive. Un­der a to­tal re­ward ap­proach, all as­pects of the work ex­pe­ri­ence should be recog­nised, and promi­nence must be giv­en not on­ly to re­mu­ner­a­tion but al­so to non-fi­nan­cial re­wards. This is im­por­tant since ex­pe­ri­ence shows that em­ploy­ees place great em­pha­sis on in­tan­gi­ble re­wards when de­cid­ing where to work and the lev­el of com­mit­ment to give to their job. There­fore it should not be for­got­ten in the com­pen­sa­tion nar­ra­tive.

We can agree that the pri­vate sec­tor em­ploy­ers have tend­ed to be at the fore­front of the for­mal de­vel­op­ment and adop­tion of to­tal re­ward poli­cies. Some pub­lic sec­tor and qua­si-pub­lic sec­tor or­gan­i­sa­tions have shown some in­ter­est in the ap­proach and made sig­nif­i­cant gains as a re­sult. What is re­quired is a holis­tic re­view of to­tal by all in­ter­est groups.

It is im­por­tant for the em­ploy­er to bet­ter com­mu­ni­cate with its em­ploy­ee their to­tal re­wards val­ue propo­si­tion. It is al­so recog­nised that many em­ploy­ees are un­aware of the sub­stan­tial costs to the em­ploy­er of ben­e­fits, even as ba­sic as pen­sions. To over­come this, em­ploy­ees can be pro­vid­ed with to­tal re­ward state­ments, which em­pha­sizes the val­ue not on­ly of pay but al­so the wider ben­e­fits pack­age and po­ten­tial­ly oth­er con­ge­nial as­pects of em­ploy­ment. This will go a long way to­wards shift­ing the con­ver­sa­tion from per­cent­age in­creas­es to To­tal Re­wards.

The Hu­man Re­source Man­age­ment As­so­ci­a­tion of Trinidad & To­ba­go (HRMATT) is the lead­ing voice of the Hu­man Re­source Pro­fes­sion lo­cal­ly. HRMATT Says is a col­umn meant to ad­dress is­sues and con­cerns of pro­fes­sion­als and the gen­er­al pub­lic fo­cused on Hu­man Cap­i­tal De­vel­op­ment. To­day’s ar­ti­cle is writ­ten by HRMATT’s Pres­i­dent and Se­nior Hu­man Re­source and In­dus­tri­al Re­la­tions Ex­ec­u­tive, Cavelle Joseph – St. Omer, SHRM-SCP, MBA, B.Sc. Learn more about HRMATT by vis­it­ing all our web­site: www.hrmatt.com. Fol­low us on Face­book, LinkedIn, In­sta­gram and Twit­ter. Con­tact us at: 687-5523 or via email: sec­re­tari­at@hrmatt.com