Rethinking work, rewards and the employee experience

As organisations manage through phases of the ongoing crisis, many are recalibrating strategies and programs tied to work, rewards and the employee experience. They are making adjustments to accommodate new protocols in response to COVID-19, but are also still determining what new ways of working will be required as they emerge from the crisis.

For now, the most significant shift has been in the proportion of full-time workers that are working from home: Employers report that the percentage of employees working from home has increased by over 25 percentage points – from 4% last year to 30% currently. Fewer than half of those workers are expected to return to the workplace after COVID-19 passes, leaving 19% of workers expected to continue working from home post-COVID-19.

A dramatically reconfigured workplace and workforce will require agile leadership that effectively balances employee and business performance needs, supports new ways of working and powers new sources of organisational value.

Work, rewards and employee experience

Managing labour costs

While 47% of respondents expect the pandemic to have a moderate or large negative impact on business in the next six months, slightly lower (41%) expect a similar impact over the next year.

Seventeen percent of employers have implemented layoffs and workforce reductions. Nearly one in 10 have engaged in an organisation-wide restructuring with another one in four planning or considering doing so (Figure 1).

Figure 1. Half of respondents have frozen or reduced hiring often as part of other actions to manage workforce size

Emerging reward practices

More than two in five employers have taken action on pay, such as reducing or delaying merit increases or freezing pay; another one in six have not done so yet but are planning or considering taking such actions (Figure 2). One in five have taken at least one action on furloughs or alternative work arrangements.

Almost half of respondents said that most employees (75% or more) who have taken a pay reduction will return to pre-COVID-19 levels by the first quarter of 2021.

Figure 2. More than two in five respondents have taken actions on pay

Changes to work

Unsurprisingly, the majority of organisations (64%) are adjusting how work is done to accommodate new protocols. Almost three in five are making adjustments to the role of the workplace and defining what work should be primarily done onsite versus remotely, and about a third are making adjustments to incorporate automation.

The main trends around how work is changing include:

• Working remotely
• Growth in automation
• Decrease in the use of non-employee talent

Employee experience

Organisations with a positive impact on employee experience are more likely to report doing well on understanding and collaboration. The survey finds that:

Executive compensation

Overall, executive pay and incentives and governance have remained stable:

• Over two-thirds of organisations (70%) have not made changes to their executive or board succession plans.
• Total Rewards is the top topic that organisations’ compensation committee oversee.
• Around two-fifths (38%) of employers have already included environmental, social and governance related metrics in their executive incentives with more planning or considering doing so.

Download the PDF to read the full executive summary.