Aon: Employee engagement linked to insight of rewards

The overall engagement level of employees is strongly linked to the perception of their total rewards package offered by their employer, research by Aon Hewitt shows. The report also highlights that employees that can share ideas and experience honest leader communication feel more engaged, underlining the need for companies to train their leadership to engage their employees.

In a recently released report, titled ‘Inside the Employee Mindset’, global talent, retirement and health solutions business Aon Hewitt researches the perspectives of more than 2,500 employees at mid-size and large employers in the US about their employment experience. One of the aspects surveyed is ‘total rewards’, which includes everything an employer provides to an employee, including pay, benefits, and the work environment

The employees surveyed have a good understanding of the total rewards package offered by their employer, with 77% of respondents (strongly) agreeing to this. Vacation and holidays (84%) and base pay (83%) are best understood, followed by medical coverage/insurance (80%) and dental coverage/insurance (78%). Least understood are work/life balance (60%), career development/training (61%) and bonus (64%).

The research highlights a strong link between the employee perception of total rewards and their engagement, with 60% of the engaged employees saying their total rewards are above or well above what other employers offer. This compared to only 24% of the disengaged employees believing this to be true. More than half (55%) of engaged employees feel their vacation and holidays offering is better than what other employers offer, while just under a third (32%) of disengaged employees feeling the same. Looking at career development/training programmes, 51% of engaged employees view their employer’s offering as competitively, whereas only 19% of disengaged employees feel the same.

Commenting on the results, Pam Hein, Partner Communication Consulting at Aon Hewitt, says: “Companies could see improvements in employee engagement by increasing awareness and understanding of these programmes. Often providing Total Rewards statements and related web tools can help foster greater understanding.  Administering engaging quizzes or quick assessments to employees can also draw attention to rewards that may be undervalued or misunderstood.”

According to the consulting firm, better communication will improve engagement. This is highlighted by the significant gap between the communications perceptions of engaged and disengaged employees. Of the engaged employees 77% feel encouraged to share ideas, while only 22% of those who are disengaged agree. When it comes to how open and honest senior leaders are viewed, a similar gap exists, with employees who view their leadership as open and honest nearly five times more engaged than those who do not agree. Following these results, ‘complete and honest communication’ was the #2 most often cited area for improvement behind ‘good pay and benefits’.

“The most engaged employees are the ones who are encouraged to share ideas and who witness open, honest communication from senior leadership,” concludes Hein. “Offering communication training for managers and leaders, regularly sharing key messages, and instituting performance- and reward-related metrics related to communication from managers and leaders, will be essential to achieve improvement in this area.”