Elections in 74 nations, several active military conflicts, predictions of extreme weather events, and a resurgent strain of the COVID-19 virus are just some of the headwinds the world will face in 2024. Amidst these uncertainties and disruptions, businesses need to gear up for a year of weak economic conditions and unpredictable geopolitical challenges.

The key to staying agile and resilient in such an environment remains essentially the same: hiring and retaining top talent. Organisations must keep track of the best compensation practices across industries to stay ahead in the talent war, craft a compelling EVP, and, perhaps most importantly, stay competitive by implementing innovative people practices. 

With 2024 expected to bring modest to stellar pay raises across different countries, looking at the definitive compensation and benefits trends shaping modern workplace policies is pertinent. In this article, we will review some of the most urgent industry trends impacting compensation practices, discuss how you can prepare for these changes and share some tools that can be helpful in these transitions. 

Higher pay transparency

With increasing emphasis on workplace equity, organisations are prioritising salary transparency in a bid to attract and retain top talent. The practice of disclosing salary and financial benefits for each role begins at the hiring stage with salary information included in the job description. It may also become a permanent part of the company’s internal communication culture.

In addition to promoting greater trust and transparency in the organisational culture, disclosing the salary for different roles will establish a sense of fairness between people and teams, identify unintended pay discrepancies and make workforce planning easier for HR teams.

With many countries already making it mandatory for businesses to disclose the salary for hiring and compliance, it’s about time you start considering how to make pay transparency an integral aspect of your HR framework. 

With Keka’s smart compensation planning software, which provides comprehensive data on salary revisions, budgeting, compensation competitiveness and bonuses, it is now easier than ever to make pay transparency a reality. HR teams can access all salary-related information and analytics in a single place. Optimised salary templates also allow HR leaders to stay a step ahead of contemporary compensation strategies by ensuring that employees are paid fairly and competitively. 

Expanding the scope of benefits

The meaning of the term ‘employee benefits’ has evolved drastically over the past decade. Here are some major, welcome additions to the term that have occurred in the past few years:

Telemedicine and critical illness benefits: These have become an essential part of employee benefits during the pandemic, along with child and elder care assistance, as employees moved to a remote/hybrid working model. 

Codification of caregiving, family planning, and paid leave policies: These signaled a willingness to prioritise employee wellbeing, along with providing financial management support to help employees make smarter decisions outside work.

Demographic-driven benefits: From workplace flexibility to pet insurance, the scope of what can constitute a valuable offering for employees can vary significantly for different people.

One can expect this trend to gain momentum in the coming years as organisations try to distinguish their benefit offerings as the most flexible, unique, and easily manageable. If you haven’t already thought about redesigning the concept of employee benefits and workplace wellness for your workforce, it may be time to start creating a strategy in place.

But what’s a good starting point for this mammoth task? Listening to your employees through pulse surveys can help you understand what people want. 

Aligning pay and benefits with performance 

As the demand for skilled talent outpaced its limited supply, the overall compensation and benefits landscape witnessed a shift toward unnaturally high compensation structures to woo top talent. This was particularly evident in industries that required more people to implement digital transformations. 

However, facing global economic uncertainties and internal pressures, businesses are moving toward implementing new performance management models that tie pay and benefits with individual output like never before. 

Aided by smart planning tools and data-driven insights, these new models often condense complex metrics into understandable scores. Besides helping your HR team decode workplace productivity trends and patterns, doing this can also reduce the opacity of the appraisal process for employees. 

For instance, with Keka’s advanced compensation management software, you can compare the pay and performance of your employees, which makes it easier to reward high-performing people and provide support to those who require assistance. Similarly, you can stay on top of engagement and retention strategies by selecting appropriate rewards, bonuses and incentives for competitive employees. 

Higher customisation for better adoption and stickiness 

A persistent challenge for most organisations and HR teams has been ensuring sustained usage and adopting employee benefits. To ensure wider coverage and higher satisfaction, there has been a conscious effort to design more flexible, personalised, and user-driven benefit frameworks that offer relevant support mechanisms. Here’s how organisations are driving better usage and sustained adoption rates:

Catering to diverse employee expectations and needs: This will continue to gain more currency in 2024 as organisations continue highlighting how their total benefits approach is a distinguisher in the job market.

Communicating value: There will be a greater emphasis on communicating the value of different benefits, training managers to discuss pay transparency, and providing the right support to people who need it most.

Digital roll-out: You can expect sophisticated solutions and policies that integrate different offerings under unified dashboards, streamline rewards processes or approvals, and nudge people to make use of available resources. 

Many organisations have devised and implemented creative employee assistance programs over the past few years, and now is the time to ensure that people use them as intended. 

Compensation and rewards in 2024: The final word

Evolving employee expectations and priorities will certainly influence compensation structures across industries in the coming year. Employers must be receptive to these demands, understand the pulse of their workforce, and use cutting-edge technology to execute their compensation strategies.

It’s helpful to remember that salary continues to be the most crucial aspect of the overall compensation and rewards framework, and having the right tools to manage payroll is vital for operational efficiency.

Learn how you can leverage data-driven tools to streamline your compensation and rewards. This article is part of a series on HR technology in emerging businesses in partnership with Keka. Find out more here.