Only 41 percent of organisations include fairness as an objective of their reward strategy, research shows. However, organisations need to focus on fair reward for all or risk losing the benefits of a diverse workforce.

16 February 2006

AMSTERDAM - Only 41 percent of organisations include fairness as an objective of their reward strategy, research shows.

Organisations need to focus on fair reward for all or risk losing the benefits of a diverse workforce reports the Chartered Institute of Personnel and Development, which has published a book, Reward and diversity: making fair pay add up to business advantage, based on their research.

"Employers should begin from the principal that all individuals, not just women compared with men, should receive equal pay for equal work," said Dianah Worman, CIPD Diversity Adviser.

"Equal pay reviews must therefore look beyond gender and explore other diversity dimensions such as age, ethnicity, and disability," said Worman.

The book suggests that there is no right or wrong pay and benefit package, but organisations need to tailor their reward strategy to their own particular culture and business objectives.

Aligning reward and diversity strategies is not only common sense but good business sense reports the CIPD.

For example, "equal pay audits can help organisations achieve central business targets if employers are smarter at using the data to find the underlying causes for unexplained gaps exposed by an analysis of pay figures."

According to Worman, equal pay audits are about using figures to expose flawed employment policies and practices so these can be reviewed to make sure the same problems don't occur again, rather than just number-crunching, massaging figures and complying with legislation.

"Good pay and benefit packages can attract people to an organisation, retain staff and motivate them," added Charles Cotton, CIPD Reward Adviser.

However, Cotton advises companies to tread carefully. Research shows that a diverse workforce can compliment these benefits through increased productivity and performance, but, managed badly; efforts to improve diversity can create conflict and tension in the workplace.

[Copyright Expatica 2006]