Employee Benefits Summit: Reward ‘must shift focus from austerity to growth’

The reward balance needs to be shifted from austerity to growth, said Duncan Brown, principal, compensation and talent at Aon Hewitt.

During his session, ‘Pay management in 2012: Back to the fundamentals’ at the Employee Benefits Summit 2012, Brown said: “There is no doubt that the government has overdone the austerity bit and needs to focus on growth to get out of this flatlining situation. Employers have got stuck in that austerity trap with recruitment and pay freezes. Unless we invest in people, we’re never going to grow our way out of it.”

Brown’s tips for shifting the reward balance were to move: from pay freezes and low pay to higher and fairer pay; from fixed to variable pay; from HR-driven to line manager-driven reward; and from secret to open, understood rewards.

He said that the reward agenda has been: cost and business-driven, fixed pay and bonuses, design-focused, HR-driven, and poorly understood by employees.

Now, however the reward agenda should be: employee engagement-focused, variable and differential awards, delivery-focused, line manager-driven, and open and understood, explained Brown.

“We have got to get onto that growth agenda for all employees to earn more. We need to manage reward processes more efficiently, which comes down to communications and delivery.”

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