When the industry is struggling, what can you pay?

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30 Aug 2016

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An oilfield services firm in Aberdeen has made 16K redundancies this year but is striving to retain top talent by offering them 20% of their salary for up to a year of gardening leave, under the condition that they do not seek alternative employment (Energy Voice reports). It is not guaranteed that employment will recommence after the leave but workers who are re-hired would receive an additional 30% of their salary; yet will this be sufficient motivation for key talent to stay loyal to the firm?


Clare Parkinson – Croner Reward Business Manager – explains: “When an industry is struggling financially, it can be difficult to motivate top talent to stay loyal if they can easily put their skills to use elsewhere. However, in their favour, the Aberdeen firm have taken steps to show that they care about staff; putting a clear strategy in place and communicating with employees to let them know the remuneration levels and processes they can expect. Still for some workers, particularly those with a high cost of living, partaking in this scheme may not be financially viable. In such circumstances, it may be worth reviewing pension schemes to save money in that area or introducing other benefits as an alternative to higher salaries, such as flexitime.

“It is also vital to ensure that directors’ remuneration is closely managed because awarding high bonuses or pay rises - when the majority of workers are suffering from significant pay cuts - could attract scrutiny from the press and/or workforce. Seeking independent advice from a pay and benefits consultancy can help to take emotions off the table and keep decisions in-line with best practice.

“If emotions run high among the workforce, especially should the financial situation improve and pay rises become sought, undertaking a job evaluation exercise can help to show how salaries have been informed based on the responsibilities of a role rather than the individual.”

To find out more about how Croner Reward can assist with remuneration management, please call 0844 728 0103 or e-mail reward@croner.co.uk.

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