Rewards used to drive business but not staff

Rewards packages are meeting business objectives but not employee needs for
work-life balance, claims a CIPD survey.

Over a third of the 2,000 HR professionals polled said recruitment and
retention is the main objective of their rewards package.

Achieving business objectives and high performance are key drivers behind
incentive strategies for 30 per cent of respondents, while less than 4 per cent
claim work-life balance is a factor.

The market rate is the most influential factor regarding rewards for 59 per
cent of the HR professionals.

The Reward Management Survey claims incentives packages do not motivate
staff sufficiently. Almost one in four respondents claim rewards have no effect
on motivation, compared with 4 per cent, who claim they are very effective.

The report, published today, claims employers are bad at communicating
rewards schemes. One in five do not report pay information to employees other
than their salaries. And 40 per cent of organisations do not explain incentives
through face-to-face interviews.

In a bid to meet employee needs, 12 per cent of firms plan to introduce a
flexible benefits system next year.

Karen Giles, organisation and resourcing adviser at the CIPD, believes
employers should make more effort to balance employee satisfaction with
business objectives.

She said: "The importance of the market rate in determining salary
seems to be growing as organisations aspire to attract the best talent. The
survey suggests, however, that organisations are not so good at keeping people
happy in their jobs, with too much emphasis on business objectives.

"This may explain why many rewards systems in the UK do not succeed in
motivating employees – in fact the reverse is true in some cases."

By Paul Nelson

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