This entrant significantly reduced staff turnover and increased sales after successfully linking its reward strategy to the needs of the business. The fast food chain discovered a correlation between employee engagement and business performance. For example, in restaurants where staff were engaged, sales were on average 28% higher and customer visits were 66% higher.
Research among 10,000 staff revealed three themes as to why they liked working for McDonald’s: family and friends, flexibility and future. These were used to create an employee value proposition backed by reward and benefits.
McDonald’s ensured pay and benefits reflected the 24/7 nature of the business. It sought to attract the best people by benchmarking salaries and benefits against the external market; staff and managers were motivated to improve customer service; and managers were recognised for individual performance and contribution. It also simplified reward and responded to staff needs by providing greater choice and flexibility in the benefits offered.
The judges were impressed by how the employer turned previous negative press coverage on its head by using its creative ‘Not bad for a McJob’ communications campaign, which highlighted its extensive benefits package, as well as its commitment to flexible working arrangements.
In 2011, McDonald’s Restaurants served 100 million more UK customers than in 2010. It paid out over £9 million in bonuses in 2011 and continues to reduce staff turnover. In the first 90 days of employment, leavers have fallen from one employee in five to one in 25 over the last seven years. One judge said: “[This entrant] was head and shoulders above the rest.”
Neal Blackshire, benefits and compensation manager, said: “Hopefully, the judges saw the real linkage between what we have done with reward and other aspects of the HR team’s work.”
Everything Everywhere, Aligning our Benefits and Policies
This entrant developed a reward strategy that mirrored business objectives such as operational excellence, integration, customer loyalty, growth and market leadership. Its aims included a harmonised set of benefits that is broadly cost-neutral for the employer.
GE, entered by Towers Watson
In its efforts to integrate UK benefits following acquisitions, GE introduced a salary sacrifice defined contribution pension for all new hires and existing staff, and made changes to its defined benefit pension scheme.
Grant Thornton UK
Its strategy involved creating salary bands for staff in each UK region, which allowed it to take a consistent approach for all staff, highlight job roles that were paid generously or needed investment, and reward specialists appropriately.
JLT Group, Benefit Modernisation
This project harmonised and modernised benefit structures and was the first group-wide reward initiative. Its flexible benefits plan now allows more than 150 permutations.
Kraft Foods, Simply Rewards, entered by Benefex
This flexible benefits scheme was key to the successful harmonisation of reward after Kraft acquired Cadbury. Its Simply Rewards scheme enables staff to trade benefits and free up funding for alternative perks.
Roche, My Total Roche, entered by Mercer
In 2011, Roche harmonised reward for employees who worked across both its pharma and diagnostics divisions. Its flexible benefits plan, My Total Roche, was the primary way this was achieved and was a major undertaking.
WorldPay, Freedom, entered by Vebnet
This entrant launched a new benefits scheme after it left its parent group in 2010. The scheme offers benefits that are aligned with its new values and people priorities.
Read more about the Employee Benefits Awards 2012