By Karen Stone, CHRE
The human resources area of compensation practice is a vastly different place than it was just two decades ago. The emergence of new thinking has led us to create many new best practices that have resulted in more transparency and equitable pay practices in many businesses today.
We have also seen some new challenges emerge. Since the 2008 recession, many organizations have been tightening their compensation practices when it comes to salary increases, bonuses, benefits and other elements of the total rewards package. Annual salary forecasts have been, by most estimations, fairly modest. And many businesses are still experimenting with the most effective way to tie pay to performance, as HR professionals continue to advance their thinking on the performance review model that brings the most value for an engaged, productive workforce.
In this month’s Compensation Issue, we examine the major trends impacting the compensation landscape – from the cover story on emerging best practices to our feature on how the leading OECD nations are addressing the gender pay gap.
You will read about some of the most innovative ways HR has found to provide alternative benefits and compensation packages, some ideas for handling contingent workforces and the gig economy, and how some companies differentiate pay for top performers.
For me, one of the most interesting facets of this month’s issue is the creativity that human resources is demonstrating towards building effective total rewards packages that result in the retention of top talent.
As we know, today it isn’t only about the amount of compensation one earns that creates satisfaction and engagement. Many workers are equally concerned with finding a role they can be passionate and purposeful about, and a role that provides flexible options enabling workers to meet their commitments and interest beyond their work world.
“Across all income levels, the top predictor of workplace satisfaction is not pay: It is the culture and values of the organization, followed closely by the quality of senior leadership and the career opportunities at the company,” wrote Andrew Chamberlain, Glassdoor’s chief economist, in a 2017 Harvard Business Review article. “Among the six workplace factors we examined, compensation and benefits were consistently rated among the least important factors of workplace happiness.”
This is a very important finding, and one that has been supported by a large quantity of recent research… and requires HR professionals to understand and create solutions that respond to this. As HR professionals continue to support the fostering of positive workplace culture and address wellness and non-monetary benefits with the balance of what is affordable. We have exciting work to do as we continue to drive value in our workplaces!
Karen Stone, CHRE, is chair of the Human Resources Professionals Association.