Businesses Can Avoid Mounting Pay Rise Pressures With The Right HR Expertise
In April 2022 the national living wage is due to rise to £9.50 per hour, which will leave employees short-changed against the rising cost of living.
This year’s 5.4% inflation rate is not the only cause for concern. Employees also face increased tax and national insurance contributions, with rising energy costs and Ofgem’s impending change to raise the energy price cap.
Inflation is already at a 30-year high, but the British Chamber of Commerce still estimates that 57% of businesses will increase the price of their goods and services over the next 3 months.
Employers too are feeling the financial squeeze. Businesses already struggling with covid absenteeism are concerned about retaining talent through the great resignation, which only adds to the growing pressure to offer a company-wide pay rise.
What Should You Do If Giving Employees A Pay Rise Isn’t Possible?
Offering employees a pay rise is a transactional approach, and may be more of a knee-jerk reaction than a sustainable long-term solution, despite the rising cost of living.
The employment market has changed significantly in recent years. There is now a much greater emphasis on creating a positive employee experience. We need to create flexible reward packages that cater to your employee demands, while at the same time can also meet the needs of the business.
Take a look at our top 5 recommendations for alternatives to the traditional pay rise:
1. Establish A Long-Term, Sustainable Rewards Budget
While an immediate pay rise may seem like the anticipated solution for the short term, it will likely only provide a quick fix. It’s important to consider what you can afford for the long term, and to develop a sustainable budget for reward-based perks.
2. Prioritise Ways To Engage Staff Over Ways To Cut Costs
Today’s employees are motivated by growth incentives. Think about the opportunities you can offer people. Perhaps you provide a cutting-edge space to learn new skills, or work on exciting projects that will stretch their abilities?
3. Consider The Broad Employee Experience
People who feel like they can make a real contribution are more likely to stick with you than they are to seek out a less favourable work environment that offers more money elsewhere. Consider your company culture – do you offer a good working environment?
4. Create A Healthy Work Life Balance
Flexibility is key. Employees should be in control of their own day, and your benefits package should look to human data to determine what employees actually want from their perks. For some people this is a cash bonus, for others it may be a 4-day week or the opportunity to work from home.
5. Give Employees A Reason To Like You
People who feel valued in their work environment will nearly always choose to have less pay in exchange for a more meaningful job. If you show your people that you’re loyal in tough times, then they’re more likely to feel inclined to stay with you despite not getting a pay rise.
The Albany HR Team is Perfectly Positioned to Assist With Package Design
Our HR team consisting of Kathleen McAdams FCIPD, Wendy Whyte MCIPD, and Jen Henderson MCIPD, brings the ideal mix of skills and experience to support businesses across the professional services.
Together, we have a combined 53 years’ HR experience.
Albany HR works closely with employers and the employees to design enviable job positions. We create fair policies, support staff, aid with grievances, and implement the right organisational structures for teams to work together in a state of synergy, not conflict.
We specialise in organisational design, executive coaching, employee relations, policy development, reward, and employee engagement at all levels of the organisation. Get in touch for a no-obligation quote.
Email: kmcadams@albanyhr.com
