HR REWARD AND BENEFITS | EMPLOYER PERSPECTIVE


People are persuaded by the psychological contract and how engaged and valued they feel


business such as London Overground Rail Organisation Ltd (LOROL) is about having the right people in place and a succession plan to replace them should they leave. The reward package is an integral part of


P


any recruitment and retention strategy and keeping a constant eye on how you measure up against your competitors is a key part of this. At LOROL, we have had a stable exec team for five years. We have come a long way in that time, but there are still challenges ahead and if one of these critical posts were to leave, the business could potentially be at risk. So the LOROL board accepts it has a responsibility to understand and recognise how best to reward and retain key talent. When it comes to influencing the board, it


can go one of two ways, in my experience. Either you learn the hard way when one of your key directors leaves and you have to deal with the fallout from that. On the upside, this can be a good way to start the conversation about reward and benefits with the board. Alternatively, and preferably, you take a


proactive approach and influence by outlining the risks and developing a mitigation strategy. But reward is about far more than just


monetary benefits for employees. People are persuaded by the psychological contract and how engaged and valued they feel. So, recognising long service and outstanding contribution should also be a key part of an overall reward strategy.


34 HR Supplement September 2012


ersonally, I would be very concerned if employee benefits wasn’t something my MD was already tuned into. After all, the smooth running of an operational


At LOROL, we have found


that getting the board to share in the celebration of others’ success is a very powerful way to get employee buy-in: just as important as a company car allow- ance or bonus. Of course,


financial


rewards and benefits are important. But it is also about spending some time on the small things that can make a big impact, such as long service awards and regular recognition for a job well done. Indeed, our exit interview data has shown people value their line manager and their career development above all else. So factoring in opportunities enabling people to explore different career spheres or develop broader skills in order to become more versa- tile should also form a key ele- ment of the reward package. The latest thinking on reward


explores how we can link the various specialist HR disci- plines making up people man- agement strategy – but that have traditionally operated in silos. So, a reward and benefits strategy that fails to effectively link into performance management, succession planning,


recogni- tion, learning and development, line


management and so on, is far less likely to serve its purpose, which is to recruit and retain the best people in your business. This Supplement also


explores the likely impact of binding shareholder votes. Yes, this will increase trans- parency in remuneration and executive pay and ensure the business case legitimately stacks up internally and externally. But,


perhaps more importantly, it will serve


to heighten the link between company performance and individual reward,


particularly for


larger companies. And as pensions auto-


enrolment looms large, there could be some tough choices ahead for employers who may think they can afford their existing level of benefits and the new level of pensions contributions.


Darren Hockaday is HR director at London Overground


Rail Organisation Ltd. He was voted HR director of the Year in the 2012 HR Excellence Awards and is speak- ing at HR magazine’s Achieving Excellence in HR conference (www.hr- magazine.co.uk/conference)


hrmagazine.co.uk


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