Employee salary ranges are increasing with inflation and the rising rate of resignations, also known as the “Great Resignation.” This means companies are getting competitive with flexible work hours and significant benefits to attract a solid full-time employee.
In simple terms, a remuneration package is the group of benefits that an employee receives when they work for a company. This package goes beyond your average salary and includes things like non-cash benefits and flexible work hours.
It’s extremely rare to find businesses that pay only a paycheck and nothing else to their team members. There are countless different types of remuneration strategies and packages that can be used to compensate your employees. An attractive remuneration package can attract the best talent in the job market.
By enabling a flexible work schedule and adding perks to your remuneration package, your prospective employees are more likely to go with you rather than another employer.
The value of a remuneration package isn’t just measured in its financial worth, with many companies working to provide benefits that don’t cost anything but still offer value to team members. Non-cash incentives make up a decent chunk of remuneration packages.
This can include flexible working hours, giving you the chance to build a package that will appeal to new employees without spending a fortune in the process.
These non-cash incentives combined with a solid salary package ensure skilled candidates are attracted to and committed to your company. But you have to get creative to find the right incentives that will attract talent to your company.
Creating a solid remuneration package isn't always easy, but we're here to help demystify the process. This article will cover the types of remuneration, why you should create a strong remuneration plan, what is included, how you can calculate your salary, and the advantages and disadvantages to watch for.
As mentioned above, remuneration can come in many different forms.
You can find some of the most common types of remuneration below, but it will also be worth thinking about the specific options that you can offer to improve the value of the jobs you have on offer.
It can be all too easy to overlook the importance of a strong remuneration package when you’re deciding what your employees should get for their work. The fact that it can cost extra money to do this is a big reason for many companies ignoring employee benefits packages, but this spending can be well worth it.
Not only will your employees enjoy more cash incentives for their work, but they will also know that they will be rewarded when they work especially hard. This can improve your productivity and decrease employee turnover dramatically.
Of course, though, it goes further than this, and many companies find that they are able to make big steps when they give their employees a comprehensive remuneration package. Direct compensation is always nice, but additional benefits are also a market standard.
Also, salary increases should be figured into the budget and should be given related to the duration of employment and increases in responsibilities. These salary increases don’t necessarily need to be part of the remuneration package, but if they are guaranteed and generous it wouldn’t hurt to include them.
One of these steps comes in the form of more applications for the jobs you have on offer. With most companies offering packages like this, it makes sense that it would be harder for employees to secure applications without offering them themselves.
People often get salaries and remuneration packages confused with one another. These two elements of employment aren’t too different, though a comprehensive remuneration package will provide more to your team than an annual salary.
A person’s salary is the main element of their remuneration package, but there will be more to this than the money they make. These packages offer new benefits and cash incentives to employees, providing something that goes far beyond making money.
In many cases, a remuneration package will go far beyond an employee’s legal entitlements. Here is a breakdown of what a Remuneration package looks like for the MissouriCorrections office.
Interesting how that all breaks down, isn’t it? It is helpful to get an idea of how other companies break down their package. You need to watch the industry standard for your location and industry to ensure you’re meeting or exceeding expectations.
Remuneration packages can include a lot of different benefits, including the annual salary that your employees receive. Employee performance will usually factor into this, but the whole thing will go beyond financial compensation.
Let’s take a look at some of the most popular elements of a competitive remuneration package to get you started.
It can be a challenge to figure out exactly how much to give your teams when you are building their remuneration package. Your employee’s annual salary is the most important element of this, and you need to make sure that you are offering salaries that are both competitive and affordable for your business.
You have three choices here: you can trail the market, meet the market, or lead the market.
Each comes with its own benefit, with trailing the market being cheaper and leading the market being more appealing to new employees and meeting the market falling in the middle. This is why some companies offer a better employee benefits package than others.
It’s best to start this process by learning what other companies pay their employees. From here, you can figure out how much you want to pay your team members depending on where you want your business to sit.
Another thing to consider is employee retention. Replacing employees is expensive, and if you increase your salary amount by a fraction, you may be able to retain employees and therefore save money on hiring overall.
Of course, at this point, you should also think about the other benefits you can offer your employees. Trailing the market can be alright when you have a bulky benefits package that will close the gap between the pay you offer and that of other companies. Likewise, though, you may have to offer a smaller remuneration package if you’re paying your employees a lot of money.
As with most of the things you do for your employees, remuneration packages come with both advantages and disadvantages. This makes it well worth taking the time to explore your options, but you should also think about how your packages could impact your business.
This is an important part of human resource management, especially if you want to provide flexible benefits. There are many benefits to having a strong remuneration package. Let’s talk about some of the main advantages.
As you can see, the benefits of a good remuneration package will often outweigh the negatives. However, there are some issues that you will need to consider and weigh before deciding about your compensation package.
If you promise a certain pay rate or benefit to your employees, you will not be able to take that away without major pushback. So, ensure that your plan is feasible before committing to it.
The disadvantages of this sort of effort are often worth it to ensure that your employees are happier in their jobs, but you can also take the time to make sure that you don’t have to deal with the negatives at all.
This will all get easier as time goes by and you’re able to shape your remuneration packages around your teams.
It can be hard to say for sure whether or not a comprehensive remuneration package will be good for your business. But it is almost certainly worth it to ensure that your team is happy. If you have the budget and bandwidth to improve your employee's benefits, why not pursue it?
It is crucial to sit down with your HR team and your finance department to ensure that your plan is affordable and aligned with your team’s efforts and expectations.
This sort of action can make it easier to push your team members to work harder, but it doesn’t always have this impact on businesses that don’t rely on excellent employee performance.
This means that you have to look at the benefits and the costs of remuneration packages to find options that will truly benefit you and your employees. Of course, though, this should be easy with so many options available to you.