4 challenges HR leaders are focused on this year

Willis Towers Watson takes a look at four of the key issues at the top of benefit and reward leaders' agendas for this year from harnessing AI and retaining talent, to implementing the EU Pay Transparency Directive and managing discussions around total reward.

 

Here are some of the core challenges that have been keeping HR leaders up at night from WTW’s recent focus group, and how they look to overcome these next year. 

While challenges around attraction and retention and benefits are not unfamiliar, evolving technology and the fast-approaching pay transparency directive are bringing more pressing issues to front of mind. 

But, with a new year comes new perspectives and solutions, which can help HR leaders make the best of 2026.

1. Implementing Pay Transparency Directive

I need to implement the Pay Transparency Directive in my organisation but I feel behind the curve and I'm struggling with job levelling.

With the Pay Transparency Directive coming into effect from June 2026 across Europe, our focus group of HR leaders were concentrating on getting ready – with many acutely aware that there is significant work to be done in the next few months.

Gender pay gaps remain widespread in many European companies. The directive seeks to shine a bright light on pay, with the hope that transparency will lead to equal pay for equal work.

Pay transparency legislation is an important force seeking to drive equity in the workplace. To prepare for greater transparency, companies must first establish a solid foundation. It's essential for organisations to define their long-term vision for pay transparency - clarifying how open they intend to be and what that journey looks like. Keep up to date with the latest legislation.

Job levelling, a key component of pay transparency, is a hot topic with delegates. As every HR team is aware, there is so much time and resource required to ensure there is both fairness and consistency across an organisation. 

Senior stakeholders were keen to explore ways in which efficiencies could be found to save time and focus on higher-value activities. In particular, automated job levelling tools are an efficient way to take the process from hours of work down to minutes.

2. Discussing rewards openly

How can I open a conversation with my employees about benefits and total rewards without creating false expectations?

Employers are nervous to talk to employees about their rewards. Why? Company leaders are concerned that they will create false expectations that their people will expect to receive more benefits.

Employers should not be afraid to discuss what's on offer. In fact, these conversations can bring unexpected and valuable insights, as well as lifts in engagement and retention. Surprisingly often, employees are unaware of many of their existing benefits and appreciate the chance to learn more.

If you're an employer in this situation, start off by gauging people's understanding of what they already have. Then, ask them what benefits they most value, what else would they value - and what means little to them?

Their answers may surprise you. One group of employees we recently worked with simply wanted more time with their managers – a no-cost item for the employer.

You're not alone. As cost pressures for businesses intensify, 54% of businesses in Europe intend to conduct a smart rebalancing of their total rewards portfolio to better align to what their people really value, over the next three years.

If you're a multinational employer and plan to ask your people what matters most to them, be sure to segment answers from country to country. One of our clients discovered a long-term benefit was a top priority among its Slovakian employees, but bottom of the list in the Philippines.

It's these kinds of revelations which can improve the efficiency of your benefits spend. And such insights can only come from asking your people what matters to them. 

Employers who are nervous about constructing communications or a benefits survey - particularly those with larger, multinational workforces – may find it helpful to work with a trusted third party.

3. Retaining talent

What can I do differently in my organisation to attract and retain talented people?

Technology is helping HR leaders to grow more sophisticated in how they use data. Particularly, technology that helps employers understand what companies they are hiring from and where they are losing people to when they leave.

Harnessing these tools gives employers several strategic advantages in talent management:

• First, it shows employers if they are sourcing from too small a pool. 
• Second, it shows who they are competing with for talent, giving them a vital benchmark for their employee value proposition - pay, benefits and employee experience. 
• Third, it's a valuable source of intelligence for employers: what's tempting people away from their organisation? What can they do differently to keep talented employees from turning into regrettable losses?

As an employer, the first step is to start conducting the analysis. External data and outside expertise may help employers to get this right.

Once you have a clear view of your company's talent flow, you can design on a targeted set of next steps. Which elements of your value proposition are attracting and engaging people? 

What elements are they leaving your organization to find elsewhere? This data helps you focus your effort, optimising your spend and the return you get on those practical changes that make the biggest impact.

4. Harnessing AI

Supplied by REBA Associate Member, WTW

WTW is a leading global advisory, broking and solutions company.

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