Agencies40% employees witnessed reduction in total pay and 45% employees did not see any change in overall pay over the past year, and this trend was more pronounced in mid-sized organisations (less than 1,000 employees), finds a new survey.
The Human Capital Survey, conducted by Grant Thornton Bharat among 16,700 employees, shows that 46% of the respondents said if given the option, they would opt for higher fixed salary even if their overall pay is reduced.
While consumer-led businesses showed higher resilience to the impact of Covid-19, sectors such as real estate, infrastructure and hospitality were badly hit.
“While one-third of the respondents experienced a reduction of more than 20% in their fixed pay, 40% did not see any change in fixed pay despite an overall decrease in their earnings. This highlighted that the variable pay component of the salary took a major hit,” said Amit Jaiswal, partner, human capital consulting, Grant Thornton Bharat.
There is an increased expectation to change the current pay mix and reduce pay-at-risk part of the compensation, specifically in the younger workforce of mid-sized organisations, Jaiswal said.
Despite 42% organisations reviewing their strategy, operating structure and performance evaluation framework post Covid-19, more than half the respondents said that their organisations experienced higher attrition amongst high-performing employees, compared with the pre-Covid-19 levels.
“Almost half of the respondents said that the actions taken by their employers met their additional needs. However, 49% feel that there is a need for action from employers to meet their expectations,” said Ritika Mathur, director, human capital consulting, Grant Thornton Bharat.
As the need to relook at strategy increases, work from anywhere, life/medical insurance, home office set up and flexible hours are being sought as high-priority benefits. Over 73% of the survey respondents also said that organisations must introduce long-term incentives, such as esops and retention bonus.
“There is an increased appetite for long-term incentives, especially from the younger workforce. Also, the definition of benefits is no longer restricted to medical insurance. While compensation managers will have to factor in all these incentives while designing their compensation philosophy, employers will have to relook at the definition of total compensation, what to include and what not to,” said Jaiswal.
The Human Capital Survey, conducted by Grant Thornton Bharat among 16,700 employees, shows that 46% of the respondents said if given the option, they would opt for higher fixed salary even if their overall pay is reduced.
While consumer-led businesses showed higher resilience to the impact of Covid-19, sectors such as real estate, infrastructure and hospitality were badly hit.
“While one-third of the respondents experienced a reduction of more than 20% in their fixed pay, 40% did not see any change in fixed pay despite an overall decrease in their earnings. This highlighted that the variable pay component of the salary took a major hit,” said Amit Jaiswal, partner, human capital consulting, Grant Thornton Bharat.
There is an increased expectation to change the current pay mix and reduce pay-at-risk part of the compensation, specifically in the younger workforce of mid-sized organisations, Jaiswal said.
Despite 42% organisations reviewing their strategy, operating structure and performance evaluation framework post Covid-19, more than half the respondents said that their organisations experienced higher attrition amongst high-performing employees, compared with the pre-Covid-19 levels.
“Almost half of the respondents said that the actions taken by their employers met their additional needs. However, 49% feel that there is a need for action from employers to meet their expectations,” said Ritika Mathur, director, human capital consulting, Grant Thornton Bharat.
As the need to relook at strategy increases, work from anywhere, life/medical insurance, home office set up and flexible hours are being sought as high-priority benefits. Over 73% of the survey respondents also said that organisations must introduce long-term incentives, such as esops and retention bonus.
“There is an increased appetite for long-term incentives, especially from the younger workforce. Also, the definition of benefits is no longer restricted to medical insurance. While compensation managers will have to factor in all these incentives while designing their compensation philosophy, employers will have to relook at the definition of total compensation, what to include and what not to,” said Jaiswal.
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