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Home > News > February 2006 > 13-Feb-2006

Line manager training is key to successful pay and benefit strategies, says survey

According to a new survey, employers will fail to achieve maximum return on investment with regards to pay and benefits unless they involve and train line managers.

The Reward Management Survey 2006, from the Chartered Institute of Personnel and Development (CIPD, found that 51% of organisations believe lack of skills and ability of line managers limits the effectiveness of pay and benefit strategies. A further 36% cited insufficient communication as one of the problems and 26% said the attitude of line managers is an issue.

The findings were discussed last week at the CIPD Annual Reward Conference 2006. Charles Cotton, CIPD Reward Adviser, said, "Line managers are given very little responsibility for determining total reward yet they are expected to communicate it to staff.

"More involvement of front line managers is needed - both in terms of determining the non-financial benefits (such as training and development and flexible working) and financial aspects of reward, such as pensions and bonus awards. This will enable them to understand the pay and benefit strategy and then implement and communicate it effectively."

According to the survey, less than a third of organisations are using recruitment and retention as a factor in determining pay award (only 29% compared to 49% last year). But employers are increasing the use of benefits with 46% of organisations planning to introduce new benefits in 2006 compared to just 16% in 2005. The new benefits are government-inspired tax advantaged childcare vouchers, bike loans and home computers.

"It is encouraging to see employers investing in employee benefits. These perks can be important and can help business in terms of recruitment, retention and motivation. However, they will also fail to help if employers continue to ignore some of the pivotal problems surrounding the effectiveness of pay and benefit strategies such as line manager involvement.

"The key is for reward practitioners to get closer to their line mangers by giving them the support and training that they need to implement effectively the organisation's pay and benefits polices and practices and to communicate what employee behaviours and performances the organisation values and how it will reward them," said Cotton.

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