A global workforce needs a consistent reward strategy to help reinforce a company’s overall culture, as Sonia Rach reports

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For more than a decade, multinational organisations have been moving towards building strong global corporate cultures, and introducing an international reward strategy is a key part of that process. Yet it’s clearly not a matter of paying employees in the same job the same amount.

Caroline Harwood, director at Burges Salmon, explains: “This is because it is necessary to take into account local factors such as employment law requirements and practice, local currency and exchange rates, and variation in the level of social benefit provision and the tax treatment of income and benefits from employment.

“Often the key is to establish a global employee grading structure that applies across jurisdictions, but which is flexible enough to align reward to the local market.”

Benefits packages need to be considered carefully as there are different cultural and legal variations, depending on the location. Employment law requirements need to be considered, alongside local pay scales and practices. Tax is another key area that organisations need to analyse when putting a benefit in place.

For example, some benefits such as share-based schemes offer tax advantages in the UK.

However, this may not be the case elsewhere. Carl Redondo, global benefits leader, Aon adds: “Strategically, you need to have a view of what your global strategy should be or mission statement and what you provide as an employer.

“There is really no point saying everybody must have access to a private medical scheme because it won’t make sense, instead it should say everybody should have appropriate health care coverage and not worry too much about how it gets delivered.”

But how does a global reward strategy affect employers and employees, in terms of benefits and costs? Harwood says: “A global reward strategy in line with an employer’s culture and values should help improve business performance. However, creating a strategy that is flexible enough to meet local needs and expectations can be a complex and costly process.”

Benefits are becoming a more extensive part of the reward package that the employee receives – particularly since 2008 when changes in the way bonuses are provided began. There is a larger focus on mental resilience, so offering benefits that can help foster a good work-life balance and overall well-being are becoming more commonplace.

However, no matter what the benefit is, the important thing is how well it’s communicated and implemented. It may be necessary to consider other issues prior to deciding what to offer in the way of a particular benefit and then how to pass this information back to the workforce. The communication plan and its style should be carefully considered to ensure that the message of a global framework to reward is supported.

Redondo says: “People are communicating in a number of ways, and increasingly online. It’s also becoming much more individualised such as via an intranet. There, people can find out everything about the benefits that are on offer, and it means everyone can see the same mission statement.”

He adds: “Emerging tech companies are also developing a better work lifestyle – something that didn’t exist 20 years ago. The way people are used to working is very different nowadays, and that adaptation is going to continue and employers are going to be encouraged to do that, too – especially in the reward space.”