Why Your Company Needs a Total Rewards Package - Cowen Partners

      Why Your Company Needs a Total Rewards Package

      As a business owner or senior manager, you’re already familiar with using salary and benefits packages to attract and retain employees. However, you might not have heard of total rewards packages. 

      Essentially, total rewards encompass a combination of tangible and intangible benefits. Rather than concentrating on the standard compensation of salary, health care, and vacation and sick leave, total rewards revamp the employee experience. 

      Companies that offer total rewards take a holistic approach to caring for their workers. They offer the standards but supplement them with additional perks like flexible working and further training and education options.

      This article will discuss the components of a total rewards package and how you can use them to improve employee retention.

      Components of Total Rewards Packages

      A total rewards package includes five essential parts: compensation, benefits, work-life balance, recognition, and opportunities for professional development.

      Compensation

      Most employees don’t seek work because they enjoy it. They get jobs because they need money to support themselves and their families. Thus, providing your workers with an adequate salary that provides for their basic needs is crucial. 

      Companies that offer compensation in line with workers’ education, experience, and skills are more likely to retain their employees than those that don’t.

      To ensure your organization is providing workers with a competitive salary, you’ll need to conduct a survey of wages for your location. Examine your competitor’s salaries and determine whether they are close to what you offer your employees. 

      If you find significant discrepancies, you’ll want to give your workers a wage boost to keep them from going elsewhere.

      Benefits

      Traditional benefits include health care, dental care, a retirement plan, and paid time off work. However, companies are now introducing new benefits to attract employees and stand out from other employers. 

      It’s become more common for organizations to offer wellness benefits like gym memberships, financial planning services, and mental health support. Some companies even offer to take on their worker’s student loan repayments or pay tuition for workers seeking to enhance their education.

      Flexible Working

      Since the pandemic, when most of the world switched to remote work for months, more workers expect greater flexibility from their employers. Employers that don’t require workers to be on-site every day are sought after. 

      Employees don’t want to endure long commutes or purchase expensive work wardrobes. They value more time with their families and the ability to pursue their hobbies. 

      Even if your organization can’t allow workers to work permanently from home, most companies can offer a hybrid working environment. In a hybrid arrangement, employees work from home several days a week and spend the rest of the time at the office. 

      Employees are more willing to work for employers who attempt to meet their flexibility arrangements through hybrid options.

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      Better Recognition

      No one likes their strenuous efforts to go unrecognized, and employers are wise to take note. Employees tend to feel more satisfied when they receive rewards for their actions. 

      Whether recognition comes from bonuses, a written commendation for their performance, or other incentives, employees like appreciation. They tend to put more effort into their work when they know it is noticed and appreciated.

      Opportunities for Development

      Most employees aren’t content to stay in the same role for life. Over time, they’ll become bored. They may not feel challenged, and it can be frustrating to watch others climb the corporate ladder while they stay in the same position.

      Employers can provide their workers with greater opportunities for development by supplementing their expenses for training or education. Additional training can prepare workers for more significant future roles in the company. Training also keeps their skills fresh. 

      If you can’t afford a comprehensive tuition support program, you can allow employees to learn new things through cross-training. Simply ask employees what skills they’d like to master and allow them to learn them by exchanging duties with colleagues. 

      Benefits of Offering a Total Rewards Package

      There are several crucial advantages to offering a total rewards package. Benefits include:

      Better Employee Retention

      Few companies can survive if their workers are constantly leaving for greener pastures. A total rewards package reduces attrition by offering critical benefits that workers appreciate. 

      If employees don’t sense they’ll be able to find a better deal in another location, they’ll be more likely to stay on board with your organization for the long term.

      More Interest Among Applicants

      If an organization has a reputation for offering low pay and few benefits, it is less likely to attract quality applicants. Job seekers will look elsewhere, knowing they can command a better package from other employers.

      Keeping your organization competitive amongst others in your area is crucial for attracting quality workers who intend to stick with the company for years to come.

      A Happier Workforce

      No one wants to spend their working hours in an unhappy environment. They like to feel good about coming to work and spending time with colleagues.

      Offering a total rewards package tends to improve worker happiness. If workers feel their pay is fair and their benefits are good, they’re less likely to be stressed about adequately providing for their families. They’ll also need less time off to decompress from an unpleasant work routine.

      Better Productivity

      Another benefit of offering a total rewards program is greater productivity among employees. When workers feel employers are meeting their needs, they are less likely to spend time worrying about concerns outside of work. Instead, they’ll put their efforts toward meeting company objectives and goals.

      Better productivity from employees tends to support the company’s bottom line. Productive employees will likely develop innovative ideas and strategies to enhance profits and streamline operations. 

      While employers may pay more to offer their employees a total rewards package, they’ll reap the benefits through a creative workforce.

      Build a Total Rewards Package to Increase Employee Satisfaction

      Offering a total rewards package is a great way to improve the quality and happiness of your workforce. Companies that provide a comprehensive rewards package find that their employees stay longer with the organization. There’s less employee attrition, and workers gain the opportunity to develop their skills and contribute positively to the organization’s success. 

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