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Remuneration and Reward: Top Tips

The role of employee remuneration and rewards in motivating employees can hardly be denied. Employee motivation depends on good remuneration systems that offer both financial and non-financial rewards. Constant change and high employee expectations are taking a heavy toll on many organisations, the government and the industry in general resulting in high employee turnover. Some employees need a better balance in their lives while others want better jobs. Sometimes this is well hidden due to employee concerns about job security, but shows up in the form of employees who are disengaged in their workplace.


Employee remuneration involves rewarding employees for their work and contributions to an organisation using both monetary and non-monetary means.


There are several monetary rewards for employees, including:

  • Basic pay for working standard hours
  • Paying for additional hours worked
  • Commissions
  • Bonuses
  • Performance-related pay
  • Profit-related pay
  • Payments by results
  • Piece rate reward systems


Human resource management rewards for employees include:

  • Pension schemes
  • Subsidised canteen and leisure activities
  • Access to company cars with phone bills and mileage paid for
  • Access to other company facilities including computer facilities, hairdressing, on-site crèche and so on

Achieving Optimal Employee Remuneration

Many organisations have a wide variety of salary and pay arrangements, but these often tend not to be properly harmonised. Enterprise bargaining, individual performance-based contracts, local area work agreements, and competition on organisational structures dominate some industry remuneration systems.


If you see any of these red flags, then it is time to take a deep look into your employee rewards and remuneration system:

  • Employees are showing disenchantment and morale is very low
  • Employees frequently complain about poor remuneration
  • Employees believe that senior management controls or manipulates the systems
  • Employees believe that remuneration is only fair for higher trained groups


It's important that organisations try and harmonise their remuneration and reward structures and create a new framework for them. Employees at all levels need to feel that they are being adequately rewarded for their efforts, and that rewards are being shared fairly and equitably. If the organisation fails to do this, they risk ending up with severe morale and performance-related problems. A highly motivated employee is likely to achieve a lot for the organisation while a demotivated one is more likely to be slow, error-prone and achieves much less.


A good employee rewards and remuneration system ensures that each employee receives recognition for his or her contribution to the organisation. A good remuneration system consists of:

  • Creating and maintaining a well-coordinated organisational structure and culture that enhances employee and organisational performance.
  • Recognising and rewarding both individual and team performance.
  • Implementing compensation systems that reward all employees fairly regardless of their position in the organisation. This involves matching remuneration with an employee's contribution, particularly where job requirements keep changing.
  • Incentives should be incorporated into the overall reward structure.


The best performance appraisal system is bound to fail if it does not enjoy the full support of the employees. The system has to reward good performance, even though it's not always easy to strike the right balance.


The organisation should have a good feedback loop between motivation and performance. A job evaluation process, that determines the contribution of each position to the organisation's overall goals, should be viewed by both the organisation and the employees as fair and equitable.



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