“A convergence of factors — including increased turnover, rising inflation, volatile markets and the current cost of living crisis — are putting increased pressure on compensation cycles,” said Dave Carhart, Vice President of Lattice Advisory Services. “This report reveals how employee perceptions around compensation are evolving in the midst of all this upheaval – and provides important insights for leaders who will be tasked with balancing employee expectations alongside shifting business needs.”
These insights come from research conducted by Lattice, the people success platform that empowers business leaders to build engaged and high-performing teams and inspire winning cultures.
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As cost of living increases, workers expect employers to step up. Over half (53%) said that cost of living should be one of the most important factors considered within a compensation review, but just 26% of employees said the cost of living was currently a consideration in their company’s compensation review process.
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Annual increases are not going to satisfy all employees, and they have specific increases in mind to feel valued. Nearly 30% of employees said they were looking to be evaluated for compensation increases every 3-6 months; assuming good performance, 47% of UK employees would need a pay rise of at least 4-5% to feel their work was being valued adequately.
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Employees see bias, and a lack of action to address it. Over half (51%) of employees agree that there is bias around gender, age, race or other factors when it comes to the way companies conduct performance and compensation reviews; of these, 36% say their companies are not doing enough to address it. Just 30% reported that their organization was leveraging technology to measure and address pay equity gaps.
