Re-inventing Rewards After A Major Restructure
Company re-structuring demands a re-evaluation of almost all business policies and procedures, and changes that involve the financial aspects of the organization are bound to have an impact on the budget of HR.
When faced with a major re-structuring, the human resources function will likely be given the task of re-inventing employee compensation and benefits, a task that must be handled quickly and delicately in order to avoid disrupting the talent equilibrium and causing upset. As the environment of business begins to evolve, employee benefits and compensation must change with it.
Strategy through philosophy
The HR Council, recommends that when introducing a new rewards program, or tweaking an existing one, developing a compensation philosophy aligned with the culture of the business is imperative, and can be done so by
identifying your goals and objectives, considering your competitiveness in attracting and retaining employees, your emphasis on internal and/or external equity, and whether performance is tied to pay increases.
The organization also emphasizes the critical importance of outlining “the balance of direct and indirect compensation,” in your business’s strategy to create a working machine of benefits.
Before undergoing the re-structuring, HR should have assessed the issues in their current compensation and benefits program, through the implementation of employee surveys and data analysis in the field of talent sustainment and development.
Learning from your mistakes with failure assessment
If the re-structuring has already taken place, then the role of human resources is to eliminate the shortfalls in the previous rewards strategy, and making sure that their upcoming plan is aligned with the new ideals of the organization and reflects the company culture.
The SHRM predicts that;
increases in premium contributions and deductibles, more spousal surcharges, growth in consumer-directed health plans, sharp increase in telehealth and access to health care tools and resources will be responsible for the biggest compensation and benefits changes, so any formatting of an employee benefits program must be mindful of these influences, especially during a re-structuring when organizations can be at their most vulnerable.
In order to re-invent a C&B program, human resources must begin to market the changes to employees after their strategy has been defined. Talent must be aware of any and all changes to their compensations program, firstly to allow them to experience all the benefits available to them, and secondly to avoid any fallout between HR and staff. Reassuring employees that their benefits are safe, or explaining why certain rewards have been cut is the most important area of communication when dealing with changes to any program.
During a company re-structuring, the likelihood of some compensations being slashed to free up funds for the rest of business is higher, and executives must consult the human resources department when doing so, giving HR the chance to voice their opinions, justify the current program or suggest changes which would most benefit the organization and employees simultaneously.
When going through a change, make the people team available and open – to questions from all employees, as there will likely be many.
Distributing materials that outline new, improved or removed policies is a great way of staying in touch with employees and avoid frustrations during the sensitive area of compensation realignment.
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