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Putting together compensation packages is one of the main responsibilities of the HR function, but the best practices and strategies look a lot different today than years past. While salary is still the most important component when it comes to putting together an offer letter, benefits play an increasingly critical role for workers who have come to expect more from their employers.
“You have to pay competitively, but that’s table stakes,” Ron Seifert, workforce reward and benefits leader at Korn Ferry, an organizational consulting firm, tells Fortune. Business leaders need to “understand how to differentiate yourself from a benefits perspective,” he says, along with other factors like bonuses and stock incentives.
Fortune spoke with five compensation professionals to get to the bottom of what employees really value—and demand—from their pay packages in 2024. Retirement plans and employer contributions are a classic, but other perks are quickly becoming the new must-haves.
Caregiving assistance has become increasingly popular as millennials have children and a “sandwich generation” of workers with aging parents try to keep up with burgeoning costs and responsibilities. Mental health benefits have also become a post-pandemic mainstay. The same is true for tuition assistance programs, especially for younger Gen Z workers.
And even though they’re not technically part of compensation, remote and hybrid work policies get a special mention. About 63% of U.S. employees said having a remote schedule was the most important part of a job to them, above salary, work-life balance, and having a good boss, according to a 2023 survey from FlexJobs. Workers want the freedom to work from home so much that they’re even prepared to take a pay cut.
“People are willing to take less salary if they’re allowed to be remote or have a very heavy hybrid, mostly at-home type schedule,” Brandi Britton, executive director of Robert Half, a management consulting firm, tells Fortune.
You can read more about the new rules when it comes to putting together the best compensation packages here.
Emma Burleigh
emma.burleigh@fortune.com
Around the Table
A round-up of the most important HR headlines.
Morgan Stanley is betting big on AI—the company is rolling out a new internal tool that helps employees extract answers from across the company’s entire research database. NBC
The new boss of Boeing pledges to “fundamentally” transform the aerospace giant’s culture following a strike last month that remains ongoing. The Guardian
Workplaces across the U.S. are in the middle of the “Great Stay”—workers aren’t leaving their jobs, and it’s making many people to feel stuck in their roles. Business Insider
Watercooler
Everything you need to know from Fortune.
Get savvy Job seekers are using AI to try and outsmart the hiring process, and recruiters are starting to catch on. —Orianna Rosa Royle
Don’t call them lazy. Gen Z is more likely than other generations to work through lunch. —Jane Thier
ABBA is mad. Famous musicians joined together on Tuesday to sign a letter protestingthe use of their music to train AI. —The Associated Press