People First HR Services

Total rewards more than a cheque

Colleen Coates

The attraction and retention of key talent is an important component of an organization’s overall success. That’s why successful organizations consider all of the elements of a total rewards program when communicating with prospective or current employees.

Total rewards, frequently referred to as total compensation, are the tools that make up the employee value proposition. In other words, total rewards include everything that an employee perceives to be of value. Essentially, an employer provides rewards that its employees value in exchange for their employees’ time, talent, effort and, of course, results.

WorldatWork, a non-profit organization focusing on global human resource issues, divides total rewards into five categories: compensation, benefits, work life, performance and recognition, as well as development and career opportunities. Leveraging these five elements is vital to the attraction, motivation and retention of a talented workforce. According to a 2010 study on total rewards, the majority of companies say their main objective for having a total rewards strategy is to attract key talent and to enhance employee engagement.

There are many factors that influence an organization’s total rewards strategy and research shows that organizations that link their strategy to their business plans will achieve greater success. When developing a rewards strategy, leaders must consider the following:

Organizational culture — Culture can be a powerful, yet invisible tool. It is the collective thoughts, attitudes, behaviours and identity of the organization. Culture can influence total rewards in terms of expected or accepted practices.

External environment — External factors include issues such as labour-market conditions, changes in legislation and new competition for talent. For instance, if there is a labour-market shortage for specific talent, it could drive up that market’s salary rates.

Internal business environment — An organization’s overall business and human resource strategy should drive the development of the total rewards strategy. Some parts of the package, such as compensation, are also influenced by the company’s current position in its lifespan. For example, startup companies frequently provide a greater proportion of cash compensation through long-term incentives.

As salary budgets tighten and the cost of doing business continues to rise, more organizations are looking toward what I would classify as non-traditional, but highly effective, forms of compensation to attract, motivate and retain their talent. In previous articles, I’ve discussed the benefits of recognition programs and how they can motivate people without costing a pretty penny. This often-neglected element of total rewards can play a significant role in motivating a workforce.

Development and career opportunities are other elements of total rewards that may be overlooked. Progressive leaders take the time to mentor key talent, providing them with opportunity to learn and grow on the job — all without having to pull out the chequebook.

According to Beverly Braun-Allard, a career management consultant with KWA Partners, a key deliverable in a career-management strategy is to redefine career development. This includes communicating that career-development discussions can lead to discovering the potential within employees while linking employees’ personal goals to their employer’s objectives. The outcome of such conversations is an actionable plan for learning, growth and skill development.

If you’re going to invest in a total rewards strategy, it is wise to have buy-in from the top ranks of the organization. In a recent total rewards survey, the majority of respondents said that the top person responsible for their company’s total rewards program reported directly to the CEO. As a result, these progressive organizations were able to achieve the objectives of their total rewards strategy, understanding the important role that total rewards plays in the achievement of organizational goals and objectives.

As an employee, consider the value proposition from your employer as it invests time and money to ensure you are appropriately rewarded for your talent and effort. When you’re looking across the street to the competition or comparing salaries with your friends, remind yourself about all those other great things that make up your employer’s total rewards package. Do you have a fun, collaborative work environment? A supportive boss? Free coffee? Flexible work hours? Tuition reimbursement? Free barbecues? The list goes on, I’m sure. But if you’re not sure, then ask yourself, “Why do I stay?”

If you don’t like the answer, then it might be time for a change. But that’s a topic for another day.

— With reporting by Barbara Chabai

Colleen Coates, CHRP, CCP, is a practice leader with People First HR Services Ltd. She can be contacted at

RESEARCH: – What is Total Rewards?

WorldatWork and Mercer 2010 survey on Total Rewards Implementation & Integration

Republished from the Winnipeg Free Press print edition June 11, 2011 H2