When we think of a benefit at work, our minds are likely to switch quite quickly to a pay rise. And many are voicing their demands with strike action, as seen at Waffle House in the US, a worker sharing on TikTok how they clocked off bang on 5pm in ‘revenge’ for being refused a pay rise, while earlier in the year, Royal Mail had to apologise after an April Fool’s prank telling staff they were getting a pay rise.
There has been a rise in average total pay, according to the ONS, with average total pay (including bonuses) for employees rising by 6.5% in February to April 2023 compared with the same period the previous year.
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But that pay rise demand is still very prevalent – and it’s likely as an HR professional, especially in payroll, that you’ve heard it this week or even today. Staff asking for pay rises is nothing new, but in a cost of living crisis it’s not always the possible solution – and companies are looking to balance that with benefits.
The thing with a pay rise is it connects to all the things that we see as work 'wins'. The significance of pay rises lies in their ability to impact various aspects of an individual's life, including financial stability, professional recognition, motivation, and overall well-being. But for companies, they're not always the percieved answer to employee wellbeing or progression - and they're not always possible to offer.
Staff asking for pay rises is nothing new, but in a cost of living crisis it’s not always the possible solution – and companies are looking to balance that with benefits
So what are the benefits of benefits vs cold hard cash?
Ruth Handcock, CEO of Octopus Money, says: “Right now, employee finances are in bad shape - as the cost of living crisis continues, the average worker is predicted to be £1000 worse off than they were in 2022. A third of employees are actively considering reducing or opting out of their pension contributions, which could leave them thousands of pounds worse off in the long run. All this may point to pay rises as the obvious solution but this puts employers in an impossible situation if they can’t match inflation with pay rises.”
She adds: "We often perceive a pay rise as a sign of success due to various ingrained societal, psychological, and economic factors. One primary reason is that financial compensation is typically linked to the value placed on one's skills, expertise, and contributions within a particular profession or industry. As such, a pay rise is commonly associated with recognition for one's hard work, dedication, and competence, fostering a sense of achievement and validation of one's efforts.