There are various evolving remuneration and reward trends in South Africa, such as competitive salary and total reward packages, variable pay and performance-based incentives, non-financial rewards, tailoring rewards for individual needs and using technology for reward management.
“In the ever-changing landscape of the South African business world, organisations face a constant challenge to attract and retain top talent. To tackle this obstacle head-on, employers increasingly focus on remuneration and reward strategies to not only entice the best candidates but also foster motivation and loyalty among their existing workforce,” says Craig Raath and Morag Phillips, master reward specialists and executive directors at 21st Century.
“In the fiercely competitive South African talent market, organisations must adapt their remuneration and reward strategies to attract and retain top talent. By offering competitive salary structures, total reward packages, performance-based incentives, and personalised non-financial rewards, companies position themselves as sought-after employers,” Phillips says.
Technology-driven solutions further streamline reward management processes, enabling organisations to stay ahead of the curve. By staying attuned to these emerging trends, South African organisations can cultivate and customise employee engagement, productivity and long-term organisational success, Raath says.
Competitive remuneration and total reward packages
“In the vibrant South African job market, where competition for skilled professionals is fierce, organisations realise the importance of offering relevant and competitive salary structures. Aligning with industry standards, these attractive remuneration packages aim to entice the brightest talent across various sectors, including finance, technology and engineering.
“Companies operating in the technology sector, for instance, are known to provide above-average salaries and enticing benefits to secure top-tier AI professionals to tackle the current technology developments,” Raath says.
In addition to competitive salaries, employers craft comprehensive total reward packages including benefits such as medical aid, retirement plans and performance-based bonuses. Phillips says this holistic approach enhances the allure of the overall offering, appealing to prospective employees.
“The key is to choose a relevant comparison and consider skills that are critical or in short supply, while at the same time taking care of the stable portion of the workforce.”
Incentives that fuel success stories
“Organisations increasingly embrace variable pay structures and performance-based incentive programmes as catalysts for employee performance and motivation in the South African employment landscape. In sectors such as retail, commission-based incentives are prevalent to recognise and reward exceptional sales achievements, stimulating sales growth,” Phillips says.
The financial services industry, on the other hand, often implements performance bonuses tied to key performance indicators (KPIs). By linking rewards directly to individual and team accomplishments, organisations foster a culture of excellence and drive employee engagement.
“While financial incentives are paramount, forward-thinking South African organisations place increasing importance on non-financial rewards to motivate and satisfy employees. Flexibility is a significant consideration, with flexible work arrangements remaining popular across industries,” Raath says.
“Offering remote work options or flexible working hours demonstrates an employer’s commitment to work-life balance and fosters a positive work culture. Organisations also invest in training and development programmes, mentorship initiatives and career advancement opportunities to provide employees with growth prospects and enhance job satisfaction.”
Phillips says a supportive work environment, coupled with recognition programmes, contributes to employee well-being and happiness. “An interesting non-financial reward that some companies maximise post-Covid is the benefits of team interaction and relationship. Companies make specific effort to enhance the interactive and collaborative opportunities and create opportunities where engagement with other people becomes a reward and job satisfier in itself.”
Customisation and personalisation
“Embracing the diverse workforce in South Africa, organisations are personalising remuneration and rewards to cater for individual needs and preferences. Companies are developing flexible benefits packages that empower employees to choose benefits aligned with their unique circumstances.
“These packages may include customisable medical aid plans or leave options, granting employees a sense of control over their well-being. Moreover, tailored wellness programs, coaching and employee assistance programs further underline an organisation’s dedication to employee engagement, reinforcing a positive employer brand,” Phillips says.
Using technology for reward management
“South African organisations are harnessing technology to streamline and optimise reward management processes. HR tech solutions and platforms are used to automate salary benchmarking, performance tracking and recognition programs,” Raath says.
Performance management software, for instance, facilitates the setting of objectives, real-time progress tracking and feedback provision, enabling a data-driven approach to performance-based rewards.
Phillips says by embracing technology-driven solutions, South African employers can enhance accuracy, transparency and efficiency in their remuneration and reward systems. Alongside these technology solutions, organisations are intentional not to lose the HUMAN part of HUMAN resources, using technology as an enabler rather than a replacement.
Craig Raath and Morag Phillips, Master Reward Specialists and Executive Directors at 21st Century.