The business case for reward

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Reward, in its broadest sense, includes all the things that attract, retain and motivate people to work in the NHS. This includes tangible and financial rewards such as pay and flexible benefits like salary sacrifice arrangements. It also includes intangible rewards such as working environment, organisational values and behaviours, learning and development opportunities, and long-term financial rewards such as being a member of the NHS Pension Scheme.

A strategic approach to reward

With continued pay restraint, and public sector pension reforms, it's more important than ever for NHS organisations to ensure that staff understand and appreciate their overall reward package for working within an organisation.

We have seen evidence that many employees within NHS organisations are not aware of the range of rewards and benefits offered by their employer. This means that they cannot understand or compare the value of their overall reward and benefit package.  By taking a strategic approach to reward, it will provide you, as an employer, with an opportunity to address this by clearly demonstrating the entire scope and value of the employment package. Adopting a strategic approach to reward can help organisations meet workforce challenges such as:

  • recruitment
  • retention
  • reducing agency spend
  • staff engagement.
You can listen to our podcast which gives an NHS and local government perspective on how we can respond to the challenge of reward in the NHS.

The importance of reward

NHS organisations provide some of the most comprehensive and attractive employment packages available. Basic pay is supported by a range of conditions of service, pension benefits, nationally agreed benefits and locally developed rewards and benefits.

In addition to tangible rewards, employees also benefit from other positive factors such a proven commitment to diversity and the intrinsic social value of the work - a factor which encourages many people to work for the NHS in the first place. 

Reward has a role to play in changing employee perception about their benefit package. It also helps NHS employers evaluate and strengthen their strategy towards staff recruitment, retention and engagement in a challenging financial climate.

A successful reward approach will depend on engagement across your organisation including: 

  • the support and commitment of senior leaders
  • engagement with employees 
  • partnership working with staff side colleagues.

The evidence for reward

We commissioned the Institute of Employment Studies (IES) to undertake a literature review of the relationship between total reward and engagement. The evidence suggests that employers should take a broader view of reward, including more than just pay and benefits and communicate their reward offer effectively to ensure that staff fully understand the reward package available to them. There is no one-size-fits-all approach to reward, so organisations need to understand what their staff want and value in order to develop a reward package that staff value and can engage with. 

Find out more about the research findings on our one-page summary total reward and engagement - reviewing the evidence. Visit our research page and read the full report from IES.

Developing your business case

The reward strategy toolkit includes the key information to develop your business case for reward including a checklist of key questions for you to consider and useful points which may be valuable to address within your business case.

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