CIPD: Employers want to shift pay focus towards benefits

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Employers are keen to see a switch in focus from fixed to variable pay, while also shifting the split between pay and benefits towards the greater use of benefits.

The 2013 CIPD Reward Management Survey showed that while 32% of employers reported that all their total pay was spent on fixed pay, and a further 32% said the split between fixed and variable pay was 90:10.

The ideal situation for employers appeared to be an 80:20 or 70:30 split between fixed and variable pay, particularly in the private sector.

The CIPD, an HR trade body, said this could be due employers seeking flexibility in how they rewarded their staff so as to ensure that those who added the most value were rewarded for their contributions.

CIPD performance and reward adviser Charles Cotton commented: "If I were a benefits manager I'd be concerned by the implications of this finding. I'd be worried my employer could be looking to divert resources from the benefit budget to help facilitate a shift towards variable pay. Yet, our survey does not find this. In fact, it shows the opposite.

"Employers want to shift the pay/benefit split towards greater use of benefits, not less. So, on the one hand, employers want to increase the variable element of total pay, and on the other hand, they want to reduce the pay element of total reward and increase the emphasis on benefits."

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