What’s involved in good reward communication?

Businesses often put a lot of thought into structuring reward packages. Butdo some employers give as much attention to how they will tell their staff about the decisions they’ve reached? That’s surprising when you think how much potential reward packages have to motivate or demotivate employees.

Clarity is key

Whatever reward package(s) your organisation offers, it’s important to communicate these to staff in ways that are understandable and transparent. Arguably, this is even more important in these financially challenging times – particularly if youhave to manage a tight pay budget.

Setting out the basics

So what are some of the fundamental priorities in communicating reward? At a basic level, employees need to understand their current total package – including any potentially valuable benefits such as pensions and healthcare. Staff should also be clear how their individual packages fit into your organisation’s overall reward policy.

Be upfront, too, about how reward structures operate in practice. For example, explain the pay ranges and benefits that apply to different job levels, and how you manage things such as flexible benefits or total reward. And if you use job evaluations or other means of evaluating roles, show clearly how you do this.

Communicating change

Carefully planned communication is especially critical when you’re making chanes to your reward structure. Pay special attention to ‘what’ and ‘why’ of your scheme or package. If you’re planning to introduce performance pay, for example, the ‘what’ should include an explanation of how and when employees’ performance will be assessed, the criteria you will use, and the impact on individual pay. The ‘why’ should include clear reasons for introducing the scheme and how it aligns with your business goals and objectives.

Communicate reward decisions in the right way and you will build trust, which in turn will secure greater engagement from your staff.

This entry was posted in Advice, Newsletter Nov 2011.