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As Work Changed in 2021, Employee Pay and Benefits Stepped Up

Articles highlighted shifts in employee rewards and the changing nature of work

Silhouettes of construction workers and cranes with the year 2020 in the background.

While compliance with COVID-19 vaccination policies and return-to-work decisions drew much of HR teams' attention in 2021, the pandemic also required benefits and compensation managers to up their game.

As some workplaces reopened and others adopted hybrid remote and onsite work models, employees continued to look to their employers for help with caregiving needs, mental health issues and other challenges. Employers also found they needed to revisit their compensation planning to meet continuing demands to reward employees equitably and to hire and keep workers during a growing labor shortage.

Here are 12 SHRM Online articles from 2021 that looked at employee rewards and the changing nature of work.


1. Rethinking Employee Benefits for Permanently Remote Workers

Employers are rethinking their health plan networks, leave policies and other benefits to make sure their offerings reflect remote workers' needs. From a health benefits perspective, employers should review and adjust their strategies to accommodate a far-flung workforce. State and local laws can also be unique when it comes to programs that require certain types of paid and unpaid time off.

2. With Employees Receptive to Financial Wellness, Strike While the Iron Is Hot

Employees now may be more receptive to financial wellness programs than they have ever been, and employers can make the most of the moment to help employees better manage their financial lives. Financial wellness programs can help employees decide whether to use available funds to set up an emergency savings account, pay down debt, save for retirement or address some other pressing financial issue.

3. Minority Wealth Gap Isn't Just About Income

Access to financial equity, along with tools and resources for making better money management and investment decisions and culturally inclusive outreach to diverse communities, are vital for assuring upward mobility for racial and ethnic minorities, according to an expert panel.

4. Employers Choose Carrots over Sticks as Employees Return Onsite

Employers bringing remote workers back into the workplace are advised to pay attention to employee concerns. Ways to do that include preparing them in advance to transition from remote to onsite work, provide an array of support and consider incentives such as spot bonuses or a higher rate of pay for onsite work.

5. Taking Another Look at Cafeteria Plans

Cafeteria plans are getting new attention during the pandemic as a way to let employees select—and fund with pretax dollars—optional insurance benefits and spending accounts that meet their health and caregiving needs. Employers shouldn't just take for granted that their employees understand the potential benefits of or how their cafeteria plans work, benefits advisors say.

6. Don't Let Mental Health Support Weaken Post-Pandemic

Some company leaders have indicated they will pull back mental health and wellbeing support once the pandemic subsides. HR can help the C-suite recognize the return on investment of providing mental health support and services, while also increasing employee retention by making sure that employees have access to the resources they need. 


1. As Minimum Wages Rise, Prepare for Pay Compression Issues

For many employers, their biggest concern about raising minimum pay levels is making sure they still differentiate pay between new hires and long-tenured employees, which can cascade into pay structure adjustments all the way up the job track.

2. HR Executive and Staff Pay Are Up

Studies highlight changes to compensation for HR executives and staff during the past year and show that women now hold a majority of HR executive roles at the biggest U.S. companies. While salary-increase prospects seem bright for 2022, professionals should always do their research before asking for a raise or jumping for an opportunity with higher pay.

3. Employers Respond to Great Resignation by Raising Pay, Improving Benefits

Business leaders are offering higher pay and more competitive benefits to combat rising resignation rates and to attract new hires, according to research from the Society for Human Resource Management. More than half of organizations report that beyond normal yearly increases, they are offering higher starting salaries and wages than last year.

4. Post-Pandemic Pay Equity Requires Vigilance

When women are out of the workforce for a significant period of time—as many were due to the economic lockdown and closed schools—they lose opportunities to earn pay raises, gain skills and get promoted. With the labor shortage, women who dropped out of the workforce and are now returning may have greater leverage in pay negotiations.

5. Select a Pay Strategy for Remote Workers

Employers that don't provide increased remote-work opportunities may find their employees leaving for jobs that provide greater flexibility. If employers do adopt remote- or hybrid-work practices, they'll have to decide on a pay strategy for offsite workers, such as whether to factor location-based pay rates into their compensation decisions.

6. As Prices Surge, Revised 2022 Salary Budgets Head Toward 4%

Inflation rose to 6.8 percent year over year in November, the highest rate in decades, adding pressure on employers to raise their projections for 2022 salary and hourly wage increases for the new year.