Jun 02, 2022
We are in a HOT economy and there aren’t enough people to fill job openings these days. The war for talent is on and basic supply and demand issues are pushing compensation northward but there are other issues as well.
Inflation is in the news daily, as are articles about compensation. This is capturing the attention of employees, and many are on the move. They are looking for better compensation, greater flexibility and better work/life balance, as well as robust benefits and retirement packages. Having a well-rounded total rewards package is necessary to keep current employees and attract and motivate new ones.
Here are some creative ideas being deployed in the different elements of the total rewards equation:
Compensation
- Significant market adjustments to match going rates.
- Sign-on bonuses are being widely used and the amounts have skyrocketed.
- Retention bonuses to recognize current employees, as well as creative retention plans combining tenure and performance if the employee can complete the program.
- Referral bonuses are hot right now as well, with some organizations offering incentives just to bring in a viable candidate to interview.
- Inc. magazine highlighted "Seer Interactive," where the founder has implemented a culture of gratitude, complete with traditional paper thank you notes backed up with spot cash bonuses, a minimum salary of $65,000 and profit sharing.
Benefits
- Good health and wellness benefits are table stakes; supporting mental health is an added perk through apps like HeadSpace and Calm.
- For retirement, many employers are either increasing their employer match or establishing an employer match to help attract candidates. The most common employer matching contribution is $0.50 on the first 6% of pay.
- Creative or unique benefits might include Milk Stork, Millie Giving or donating to to a local zoo in exchange for zoo entrance passes and parking permits, then allowing employees to sign up for a summer day to take their family to the zoo.
- Bonus 162 plans or other nonqualified deferred compensation plans can make a big difference when trying to attract executive talent
- Student loan repayment benefits can really help attract new graduates. Section 2206 of the CARES Act allows a portion of student loan payments to be excluded from income. Whether those payments are made directly to the employee or the lender, they will be tax-free. The income exclusion is up to $5,250 per year per employee. This new provision benefits both the employee and employer.
- Inc. magazine highlighted The MB Group for eliminating timesheets to make employees feel more “human” and trusting them to “just do great work for clients."
Work-Life Effectiveness
- Some organizations are considering a 4-day workweek or summer hours.
- Inc. magazine highlighted Bobbie as an ideal workplace for ambitious parents, with job security guaranteed for up to a full year of parental leave, on top of the paid 16 weeks, and hired a personal assistant who is available for any employee who needs assistance.
Performance Management and Talent Development:
- Offering employees quarterly check-ins to stay connected to their work and developmental needs is important.
- Holding Talent Cafés for your employees to share knowledge on different subjects can be a nice way to foster development.
- Offering coaching services for high potential mid-level talent to get to the senior level.
- Other benefits highlighted by Inc. magazine include work-life specialist coaches, home-office stipends, handyman help and a happiness fund.
In short, there are many ways an organization can get creative. Newport’s Compensation Consulting Team can help you with your total rewards philosophy. Call us to schedule a facilitated session.
The information contained herein is general in nature and is not intended to address the circumstances of any particular individual or entity. Please consult with your tax, accounting or legal advisors before making decisions. Newport Group, Inc. and its affiliates provide recordkeeping, plan administration, trust and custody, consulting, fiduciary consulting, insurance and brokerage services. 20220526-2216789