IS YOUR REWARD FAIR?
As the COVID-19 pandemic
Charles Cotton explores the options around pay cuts, bonuses
and benefits during the pandemic
continues, so does the economic
impact. Businesses have been
through a turbulent six months,
and this looks set to continue.
There have been winners and
losers from the crisis, and some of the
winners have looked to reward workers
accordingly, such as through pay rises or
one-off bonuses. Some are also looking
to the future. For instance, last month
Kingfi sher launched an all-colleague
share plan. Under this scheme, every
share bought by a worker is matched on
a one-for-one basis by the business. The
minimum monthly contribution starts
from £10, with a maximum total annual
contribution capped at £1,500 to ensure
that store colleagues are the priority.
A rounded wellbeing approach
While the focus has unsurprisingly
been on physical wellbeing and more
recently mental wellbeing, organisations
must also think about their employee’s
fi nancial wellbeing.
With attention diverted to other
important employee issues such as
furlough, homeworking or redeploying
members of staff to busier departments,
it is important for organisations to take
a step back and consider how to reward
teams and recognise their good work.
First off, reward professionals
should check the relevance of the
organisation’s reward philosophy,
principles and strategy relating to
the current circumstances. Given the
increased media, customer and investor
scrutiny about decisions and outcomes,
this includes having policies in place
to ensure that reward actions are fair.
Having a defi nition of what’s fair will
help guide your thinking. For instance,
whether to reduce the pay of those who
choose to move away from living near
the workplace or the appropriateness
of executive bonuses.
If the organisation must freeze or
cut pay, is there something that can be
offered in compensation, such as extra
leave, and what protection will there be
for the low-waged, often the essential
and key workers who have done so much
to help our economy and society?
Looking to the future, when the
business improves, how will you reward
staff for their contribution? The hope of a
better future can be powerful in inspiring
commitment from your people.
Pandemic responses have not just
been limited to pay. Employers have been
reviewing their support for colleagues
who have had to shield or have fallen ill
due to COVID-19, such as improved sick
pay and fl exible working arrangements.
Christmas parties and employee
recognition celebrations are being moved
online. While other benefi ts that may
be boosted by the pandemic include a
fi nancial allowance for employees who
now must work from home, the cycle-towork
scheme and virtual GP services.
Tackling the issue of poor fi nancial
health is crucial too. CIPD research
shows that employee perceptions of their
fi nancial security have declined since the
pandemic and subsequent restrictions.
This can have a negative impact not
only on their mental wellbeing, but also
on their productivity and their ability to
do their job. For this reason, it makes
sense for employers to create a strategy,
preferably with a budget, to meet this
challenge. The response can include
hardship loans, fi nancial education
programmes, highlighting the problems
of fi nancial scams and signposting
where to go for further information and
guidance. Again, this is an opportunity to
talk about the future and help employees
set fi nancial wellbeing priorities.
As we move into the next stages
of the pandemic, having a reward
strategy that is fair, relevant and fl exible
is going to be important in enhancing
employee wellbeing and putting the
organisation in the best situation possible
to respond to what might happen in the
next six months.
Charles Cotton, performance and
reward adviser, CIPD
Charles Cotton, CIPD
will there be for the
14 | Reward Strategy