Fair pay: internal equality as a touchstone for companies
More than a third (36%) of European employers see internal equality as the biggest challenge in terms of pay. While almost 30 percent are already actively working to improve equal pay and 31 percent have plans to do so in the future, almost half (40 percent) state that they are not currently taking or do not intend to take any concrete measures to eliminate pay inequality. These are the findings of an international study by SD Worx, Europe's leading provider of HR solutions.
At the same time, the development of a strategically sensible remuneration policy is a key challenge for 21% of companies, with the financial well-being of employees taking center stage. This is a slight decrease compared to three years ago (24 percent). Although employers attach great importance to equality, four out of ten companies have no plans to solve the existing problems.
Wage transparency and lack of knowledge about legal requirements
Pay transparency is the second biggest challenge for 35% of employers. However, 41% of companies have not yet taken any concrete steps to promote transparency. A third (32%) plan to create more transparency in the future, while 28% are already actively working on this. However, almost a third of employers (29%) state that they are not fully aware of the legal requirements, such as the EU Pay Transparency Directive.
Rising wage costs and financial burden
A further third of employers see the financial well-being of employees as a major challenge, as financial stress is increasing among employees. The most common measures taken include fixed salary increases (44 percent), variable salary adjustments (40 percent) and additional benefits such as health insurance or company pension schemes (35 percent). More than half of companies (53%) also recorded an increase in wage costs in the past year.
Lack of communication of the remuneration policy
The communication of remuneration policy also remains a weak point: 29 percent of companies state that they do not communicate clear information about their remuneration policy, which means that almost 60 percent of employees do not feel sufficiently informed.
Four success factors for a sustainable remuneration policy
"Our study shows that half of European companies are already looking at a strategic compensation policy, with the UK (60 percent), Romania and Poland (both 58 percent) leading the way," says Bruce Fecheyr-Lippens, Chief People Director at SD Worx. "In today's competitive market, it is critical to align compensation with employee needs. This not only helps to attract talent, but also to retain it. Six out of ten employees consider salary to be the most important criterion when deciding for or against a company. Care should therefore be taken to strike a balance between remuneration and labor costs. A mix of financial and non-financial benefits increases employee satisfaction and well-being."
"According to the EU Pay Transparency Directive, companies with more than 250 employees must prepare annual reports on the gender pay gap in their organization," adds Fecheyr-Lippens. "Smaller companies with more than 150 employees must do this every three years. But only a quarter of European companies currently offer a 'total remuneration overview'. We recommend open communication about the remuneration policy. This creates trust and an honest, transparent working environment in which all employees feel valued."
Source: www.sdworx.com
