During a time of crisis, businesses can use their rewards programs to reboot the work experience within their organizations, advised corporate compensation and benefits leaders at the WorldatWork 2020 Total Resilience Virtual Conference & Exhibition on July 8.
"Employers face unprecedented challenges with a deadly pandemic, humanitarian crisis and economic meltdown," said Scott Cawood, president and CEO of WorldatWork, an association of total rewards professionals. "We have economies to build up and racism to tear down. We can work our way through all of this if we come together."
Speaking on the opening panel, "Resilience Through Rewards—Our Chance to Change the Future," Cawood noted that resilience is the ability to recover from setbacks through emotional elasticity, "bouncing back to a better place and creating something better than we have today." HR staff can foster resilience among employees and ensure that resilience becomes part of the business culture by reimagining total rewards strategies that cover compensation, benefits, recognition, development and well-being, he said.
Susan Brown, senior director for compensation at engineering and technology firm Siemens USA, which has more than 50,000 employees, has focused on protecting employees and keeping them engaged and paid during the pandemic.
The challenges the business is facing has "brought everyone together across HR niches," allowing the company to adopt responsive policies at a faster pace than previously thought possible, Brown said. In March, as the pandemic surged, the firm "pushed through an emergency leave policy in one week to ensure people would still get paid if they tested positive and had to self-isolate." Procedures were relaxed to put remote work in place where it was feasible to do so. While furloughs and shorter workweeks were considered as alternatives, leadership decided to keep everyone paid and working to the extent possible, with about 70 percent of employees working remotely.
The pandemic has 'brought everyone together across HR niches', to respond at a faster pace than previously thought possible.
— Susan Brown, Siemens USA
"The conversation changed from leaders talking about business results to talking about putting people first," Brown said. "We found that in this time of crisis, we could band together and collaborate across country and division boundaries."
Brown is committed to keeping the innovations ongoing. So far, Siemens USA has not adopted geographic differentials to adjust the pay of remote workers, she said, but it may look to do so long term if remote work leaves more employees far from their former corporate worksites.
Siemens is also looking at using dollars in its merit-pay pool to reward employees over shorter time frames, to keep employees engaged as "the world moves faster," Brown said. Annual bonuses are being revisited to ensure they reward behaviors that drive corporate adaptability and companywide resilience.
Making a Difference
Enhancing social connections has been a top priority for Kumar Kymal, global head of compensation and benefits at BNY Mellon, an investment-management firm with nearly 50,000 employees.
"We made sure we were addressing employees' stress and anxiety" during the pandemic, Kymal said. "We built an Internet site to promote mental health and support services [that BNY Mellon offers employees], including online stress programs. Communications around health and safety have been a top priority, along with providing job guarantees for employees globally—with no layoffs."
He added, "We've broken all the excuses we had before [the pandemic] about how quickly we can get things done. A crisis gives you permission to push new ideas and approaches, and lets you ask foundational questions—What is the right thing to do, for us and for our culture?"
'We've broken all the excuses we had before [the pandemic] about how quickly we can get things done.'
— Kumar Kymal, BNY Mellon
Helping employees cope "is the number 1 priority for us," he added.
As for adapting to telework, "I wouldn't say work in an office is now obsolete, but we've shown you can have employees working remotely and still be very productive, and for some portion of the population, they may be even more productive."
But, he noted, "it's not necessarily the greatest experience to be working from home five days each week. Some roles that require collaboration may be more effective in a shared physical environment with access to office equipment, not every day but for some portion of time."
This requires flexibility on management's part, allowing employees to "come in and collaborate but to also spend time working from home."
Steve Pennacchio, senior vice president of total rewards at Pfizer, a biopharmaceutical company, oversees pay and benefits for 85,000 employees in 95 countries, including 25,000 essential workers, many of whom are working on COVID-19 vaccine development.
"We agreed not to lay off or furlough employees, but to continue to pay people working remotely or even if they couldn't continue doing their job," he said. The company is also paying bonuses for essential workers and is paying employees, including medical-service professionals, who take time away from their jobs to volunteer in their local communities.
Pfizer is also making sure that its annual incentive pay program is tied to performance, "adjusted for the impact of COVID-19," in line with companies that are allowing more discretion to adjust performance targets or award payouts.
"Mental health of our colleagues has to be paramount," Pennacchio said. Pfizer encourages workers to take time off, "even a day to take a drive."
Businesses will be permanently changed by what they've experienced over the past several months, the panelists agreed.
"The traditional merit increase will be reconsidered, I think," Siemens' Brown said. The workforce may become more transient, and "we may see more of the gig workforce ramping up. That means looking at what we do with that big amount of dollars in the merit pool and maybe using it in a different way, such as to fund other rewards activities, or to use that money in different time frames" to reward outstanding performance more than once a year.
Pfizer's Pennacchio advised "make sure you have an effective recognition program. It isn't necessarily about the money but recognizing the people who've done the special efforts. People want the sense that they're appreciated and that their efforts are noted."
BNY Mellon's Kymal observed that "traditionally, when you looked at attraction and retention data [from the perspective of job candidates or employees], compensation—and incentive-based pay—ranked high and benefits tended to lag" as top considerations. "I believe that we will see a shift, where benefits—and health care especially—will be much more important and rank much higher in terms of attraction and retention, because of the experience that people have gone through."
The importance of mental health, wellness and well-being, he said, "is now seen as critical by CEOs and executive leaders, and it's going to be a much more important area within the [rewards] portfolio," and will be an area that companies will invest in and lead with, as they've done during the pandemic.
In terms of pay programs, "we've rethought who the essential workers are and how we support them," Kymal noted. "There's going to be a shift in thinking about the criticality of the lower-compensated employees who have been shown to face greater risks"—such as maintenance staff or front-line retail workers—"as more businesses have conversations around a living wage and doing the right thing" for these workers.
"That's a shift we'll see over the next number of years," he predicted.
Related SHRM Articles:
Creating Whole-Company Resilience Through Emotional Health and Well-Being, People + Strategy Journal, Summer 2020
Wellness Programs Step Up as Worksites Reopen, SHRM Online, July 2020
Managing Onsite and Remote Workers Requires Finesse, SHRM Online, July 2020
Developing a Post-Pandemic Pay Strategy, SHRM Online, June 2020
Wellness Programs Show Modest Benefits, as Efforts Pivot to 'Well-Being', SHRM Online, June 2020