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1 www.worldatwork.org/totalrewards

www.worldatwork.org

Total Rewards Model A Framework

for Strategies

to Attract,

Motivate and

Retain Employees

WorldatWork Total Rewards Model 32 www.worldatwork.org/totalrewards

• Compensation

• Benefits

• Work-Life

• Performance and Recognition

• Development and Career Opportunities

= Leveraging Five Elements to Attract, Motivate, Retain

• Business strategy

• Organizational culture

• HR strategy

• External influences (competition, industry, regulation, etc.)

• Geography (location of workforce)

Context of Total Rewards

Employee provides: Time, talent, efforts and results

Employer provides: Total rewards valued by employees

The Exchange Relationship

Total Rewards Strategy

Dedicated to Knowledge Leadership in Total Rewards

During the past several years, the concept of total rewards has advanced

considerably. Practitioners have experienced the power of leveraging multiple

factors to attract, motivate and retain talent; high-performing companies

realize that their proprietary total rewards programs allow them to excel

in new ways.

At the same time, human resource professionals, consulting firms, service

providers and academic institutions have made significant contributions

to our understanding of total rewards.

The WorldatWork Total Rewards Model

 Reflects the maturity and power of the concept

 Depicts five elements that, collectively, comprise total rewards

 Provides the organizational and environmental context in which total rewards

strategies and pro grams exist

 Articulates the desired outcome of attracting, motivating and retaining satisfied

and engaged employees who create business performance and results

 Demonstrates the dynamic relationship between employees and employers—

the employee’s contribution of time, talent and efforts for desired

business results.

As the association of the profession, WorldatWork presents this model to:

 Represent the profession’s conceptual framework for total rewards

 Serve as a tool for practitioners to use with management in their

own organizations

 Depict the official WorldatWork model of total rewards

 Serve as a foundation and guidepost for intellectual capital

development in the profession

 Become a tool for academics, consultants and others to support

their intellectual capital endeavors.

(See page 5 for model definitions.)

WorldatWork Total Rewards Model 54 www.worldatwork.org/totalrewards

Pay provided by an employer to an employee for services

rendered (i.e. time, effort and skill). Includes both fixed

and variable pay tied to levels of performance.

Programs an employer uses to supplement the cash

compensation that employees receive. These health, income

protection, savings and retirement programs provide security

for employees and their families.

A specific set of organizational practices, policies and

programs, plus a philosophy, that actively supports efforts

to help employees achieve success at both work and home.

Performance: The alignment of organizational, team

and individual efforts toward the achievement of business

goals and organizational success. It includes establishing

expectations, skill demonstration, assessment, feedback

and continuous improvement.

Recognition: Acknowledges or gives special attention

to employee actions, efforts, behavior or performance.

It meets an intrinsic psychological need for appreciation of

one’s efforts and can support business strategy by reinforcing

certain behaviors (e.g., extraordinary accomplishments) that

contribute to organizational success. Whether formal or

informal, recognition programs acknowledge employee

contributions immediately after the fact, usually without

predetermined goals or performance levels that the employee

is expected to achieve. Awards can be cash or noncash

(e.g., verbal recognition, trophies, certificates, plaques,

dinners, tickets, etc.)

Development: A set of learning experiences designed

to enhance employees’ applied skills and competencies.

Development engages employees to perform better

and engages leaders to advance their organizations’

people strategies.

Career Opportunities: Involve the plan for employees to

advance their career goals. May include advancement into

a more responsible position in an organization. The company

supports career opportunities internally so that talented

employees are deployed in positions that enable them

to deliver their greatest value to the organization.

Total Rewards Definitions Total Rewards Component Definitions

For example programs and more information, go to www.worldatwork.org/totalrewards

Compensation

Benefits

Work-Life

Development and Career Opportunities

Performance & Recognition

The Elements of Total Rewards

There are five elements of total rewards, each of which includes programs,

practices, elements and dimensions that collectively define an organization’s

strategy to attract, motivate and retain employees. These elements are:

The elements represent the “tool kit”

from which an organization chooses

to offer and align a value proposition

that creates value for both the

organization and the employee.

An effective total rewards strategy results in satisfied, engaged and productive

employees, who in turn create desired business performance and results.

The elements, as WorldatWork has defined them, are not mutually exclusive

and are not intended to represent the ways that companies organize or deploy

programs and elements within them. For instance, performance management

may be a compensation-function-driven activity or may be decentralized in line

organizations; it can be managed formally or informally. Likewise, recognition

could be considered an element of compensation, benefits and work-life.

Context for Total Rew ards

The WorldatWork model recognizes that total rewards operates in the context

of overall business strategy, organizational culture and HR strategy. Indeed,

a company’s exceptional culture or external brand value may be considered a

critical component of the total employment value proposition. The backdrop of

the WorldatWork model is a globe, representing the external influences on a busi-

ness, such as:

 Legal/regulatory issues

 Cultural influences and practices

 Competition

Compensation

Benefits

Work-Life

Performance and Recognition

Development and Career Opportunities

6 7

To get a comprehensive view of your organization’s value proposition, simply check off the rewards your organization currently provides.

Development & Career Opportunities

Learning Opportunities  Tuition Reimbursement

 Tuition Discounts

 Corporate Universities

 New Technology Training

 On-the-Job Learning

 Attendance at Outside Seminars and Conferences

 Access to Virtual Learning, Podcasts, Webinars

 Self-Development Tools

Coaching/ Mentoring  Leadership Training

 Exposure to Resident Experts

 Access to Information Networks

 Formal or Informal Mentoring Programs

Advancement Opportunities  Internships

 Apprenticeships

 Overseas Assignments

 Internal Job Postings

 Job Advancement/ Promotion

 Career Ladders and Pathways

 Succession Planning

 On/Off Ramps through Career Lifecycle

 Job Rotations

Performance  1:1 Meetings

 Performance Reviews

 Project Completion/ Team Evaluations

 Performance Planning/ Goal Setting Sessions

Recognition  Service Awards

 Retirement Awards

 Peer Recognition Awards

 Spot Awards

 Managerial Recognition Programs

 Organization-wide Recognition Programs

 Exceeding Performance Awards

 Employee of the Month/ Year Awards

 Appreciation Luncheons, Outings, Formal Events

 Goal-Specific Awards (Quality, Efficiency, Cost-Savings, Productivity, Safety)

 Employee Suggestion Programs

Performance & Recognition

Your Total Rewards Inventory

Compensation

Base Wages  Salary Pay

 Hourly Pay

 Piece Rate Pay

Premium Pay  Shift Differential Pay

 Weekend/Holiday Pay

 On-call Pay

 Call-In Pay

 Hazard Pay

 Bi-Lingual Pay

 Skill-Based Pay

Variable Pay  Commissions

 Team-Based Pay

 Bonus Programs

 Referral Bonus

 Hiring Bonus

 Retention Bonus

 Project Completion Bonus

 Incentive Pay

Short-term:

 Profit Sharing

 Individual Performance Based Incentives

 Performance- Sharing Incentives

Long-term:

 Restricted Stock

 Performance Shares

 Performance Units

 Stock Options/Grants

Benefits

Legally Required/Mandated  Unemployment Insurance

 Worker’s Compensation Insurance

 Social Security Insurance

 Medicare

 State Disability Insurance (if applicable)

Health & Welfare  Medical Plan

 Dental Plan

 Vision Plan

 Prescription Drug Plan

 Flexible Spending Accounts (FSAs)

 Health Reimbursement Accounts (HRAs)

 Health Savings Accounts (HSAs)

 Mental Health Plan

 Life Insurance

 Spouse/Dependent Life Insurance

 AD&D Insurance

 Short-Term/Long-Term Disability Insurance

Retirement  Defined Benefit Plan

 Defined Contribution Plan

 Profit Sharing Plan

 Hybrid Plan

Pay for Time Not Worked  Vacation

 Holiday

 Sick Leave

 Bereavement Leave

 Leaves of Absence (Military, Personal Medical, Family Medical)

Work-Life

Workplace Flexibility/ Alternative Work Arrangements  Flex-Time

 Telecommuting

 Alternative Work Sites

 Compressed Workweek

 Job Sharing

 Part-time Employment

 Seasonal Schedules

Paid and Unpaid Time Off  Maternity/Paternity Leave

 Adoption Leave

 Sabbaticals

Health and Wellness  Employee Assistance Programs

 On-site Fitness Facilities

 Discounted Fitness Club Rates

 Weight Management Programs

 Smoking Cessation Assistance

 On-Site Massages

 Stress Management Programs

 Voluntary Immunization Clinics

 Health Screenings

 Nutritional Counseling

 On-Site Nurse

 Business Travel Health Services

 Disability Management

 Return to Work Programs

 Reproductive Health/ Pregnancy Programs

 24-Hour Nurse Line

 On-Site Work-Life Seminars (Stress-Reduction, Parenting, etc.)

 Health Advocate

Community Involvement  Community Volunteer Programs

 Matching Gift Programs

 Shared Leave Programs

 Disaster Relief Funds

 Sponsorships/Grants

 In-Kind Donations

Caring for Dependents  Dependent Care

Reimbursement Accounts

 Dependent Care Travel-Related Expense Reimbursements

 Dependent Care Referral and Resource Services

 Dependent Care Discount Programs or Vouchers

 Emergency Dependent Care Services

 Childcare Subsidies

 On-site Caregiver Support Groups

 On-Site Dependent Care

 Adoption Assistance Services

 After-School Care Programs

 College/Scholarship Information

 Scholarships

 Privacy Rooms

 Summer Camps & Activities

 Special Needs Childcare

 Disabled Adult Care

 Geriatric Counseling

 In-home Assessments for Eldercare

Financial Support  Financial Planning

Services and Education

 Adoption Reimbursement

 Transit Subsidies

 529 Plans

 Savings Bonds

Voluntary Benefits  Long Term Care

 Auto/Home Insurance

 Pet Insurance

 Legal Insurance

 Identity Theft Insurance

 Employee Discounts

 Concierge Services

 Parking

Culture Change Initiatives  Work Redesign

 Team Effectiveness

 Diversity/Inclusion Initiatives

 Women’s Advancement Initiatives

 Work Environment Initiatives

 Multigenerational Initiatives

WorldatWork Total Rewards Model 8

Worldwide Headquarters

WorldatWork

14040 N. Northsight Blvd.

Scottsdale, AZ 85260

Washington, D.C. Office

& Conference Center

1100 13th Street, NW

Suite 800

Washington, D.C. 20005

Phone: 877-951-9191

Fax: 866-816-2962

About WorldatWork® The Total Rewards Association

WorldatWork (www.worldatwork.org) is a not-

for-profit organization providing education,

conferences and research focused on global

human resources issues including compen-

sation, benefits, work-life and integrated

total rewards to attract, motivate and retain

a talented work force. Founded in 1955,

WorldatWork has nearly 30,000 members in

more than 100  countries. Its affiliate orga-

nization, WorldatWork Society of Cer tified

Professionals®, is the cer tif ying body for

the p r e s tig iou s C e r tif ie d C omp e ns ation

Pr ofe s siona l ® (CCP ®), Ce r tif ie d B e nef it s

Professional® (CBP), Global Remuneration

Pr ofes siona l (GRP ®), Wor k- Life Cer tifie d

Pr ofe s s iona l™ ( WLCP ®), C e r tif ie d S a le s

C o m p e n s a t i o n Pr o fe s s i o n a l™ (C S C P™ ),

a n d C e r t i f i e d E xe c u t i ve C o m p e n s a t i o n

P r o f e s s i o n a l™ ( C E C P™ ) . Wo r l d a t Wo r k

has of fices in Scot tsdale, A r izona , and

Washington, D.C.

The WorldatWork group of registered marks

includes: Alliance for Work-Life Progress® or

AWLP®, workspan®, WorldatWork® Journal,

and Compensation Conundrum®.

www.worldatwork.org

©2011 WorldatWork. Not to be reproduced in any form without express written permission from WorldatWork.

W57963142 10/2011