CPO perspective: After a year of enormous change how can HR and reward leaders prepare for 2025?
We’ve been talking about the growing remit of HR and reward leaders for a number of years, and 2024 was no exception, as we discussed in our 2024 wrap-up webinar.
They had lots competing for their time and attention – including major shifts in legislation, workplace culture and benefits expectations.
And with continuing budgetary pressures, there’s always a need to do more with less.
Here are three of the major trends that have been on HR and reward leaders' agendas in the last 12 months and strategies to navigate them in 2025:
1. Employee expectations continue to grow
Benefex’s 2024 research revealed a growing perception gap between what HR leaders think of the employee experience compared to what their people thought.
About two-thirds (64%) of employers rate their employee experience as excellent but only 20% of employees agree.
Employees expect more of their employers than ever before; in fact, 81% of employees say employee experience is more important than it was just a year ago.
Socio-economic pressures have increased people’s reliance on their organisations for support, and it’s also easier than ever before for employees to see what other organisations are offering.
Social media is arguably increasing that perception gap, as people can see the exceptional things other companies are doing (especially as organisations are most likely to broadcast their standout offerings).
It’s also important to remember that employees are also consumers; they’re used to hyper-personalised and customised experiences from the likes of Amazon and Netflix – so they expect a similarly seamless experience from their workplace tech.
Strategy for 2025: Be laser-focused on what matters most
Different people value different things so it will never be able to provide everything employees want.
So be ruthless in your prioritisation and pick two or three areas where you can have the greatest impact.
Anchor your strategy to your organisation’s culture, mission and values, and communicate this clearly to employees.
For example, flexibility is important to our culture at Benefex so earlier this year we launched benefits allowances via our Wallet product to put greater choice in people’s hands.
Beyond promoting new benefits and initiatives, ensure employees are aware of what you already offer by communicating frequently and using employee advocates or ‘influencers’ to share the impact of your programmes.
Communicating the value of existing programmes remains a cost-effective way to elevate the employee value proposition.
2. Legislative changes take up bandwidth
There are a range of political, economic and legislative changes that HR and reward teams faced in 2024, including:
- In the UK, the October Budget included announcements that: employer NI will be increasing by 1.2% to 15%, the National Minimum Wage will increase for workers 21 and over (by 6.7%), and IHT will apply to pensions from April 2027.
- In Ireland, pensions auto-enrolment will take effect from 30th September 2025.
- The EU Pay Transparency Directive is set to come into force in 2026.
Navigating these challenges while continuing to deliver strategic value remains a core challenge.
Strategy for 2025: Reprioritise and use technology strategically
To prepare for changes in legislation, HR and reward teams must put a lot of time and energy into understanding how to best manage processes internally and ensure compliance.
However, there’s always going to be some element of the unexpected.
Ideally teams will build some capacity into their plans to be able to manage these changes when they happen, so that they’re ready to reprioritise and pivot – while continuing to make progress on their most strategic projects.
Leaning on technology can also help teams navigate these changes more quickly.
For example, many global organisations are looking to TRS to prepare for the EU Pay Transparency Directive.
Similarly, UK employers are using benefits platforms to drive greater engagement with tax-efficient benefits, reducing employer National Insurance costs.
AI will also have a role to play in helping HR teams free up time for strategic thinking – but take a purposeful approach.
Ensure you get your data foundation right and focus on practical applications that can save you time on repetitive, time-consuming tasks; then experiment with analytical and predictive tools that can add a lot of value.
3. Employees are increasingly dispersed
A massive 80% of the global workforce is deskless, and with many employees working in a remote or hybrid way, or dispersed across different countries (and time zones), employers need to ensure their strategies are engaging all their people.
Deskless industries in particular are facing ongoing challenges in attracting, engaging and retaining employees.
In response, there’s a big drive across a broad range industries to roll out reward, benefits and wellbeing provisions to all employees and to ensure that these are accessible wherever and however they’re working.
Strategy for 2025: Prioritise communication and put the right tech in place
To engage dispersed employees, promote a culture of complete transparency and use asynchronous communications methods.
For example, document conversations and decision-making, and experiment with short videos and podcasts to communicate internal updates so employees can easily stay informed.
Using a wider range of formats also caters to varying employee preferences and neurodiversity.
More organisations are looking to implement global benefits technology to provide employees with a consistent and unified benefits experience, no matter where they’re located.
Indeed, 29% of employers say this is the main reason for implementing benefits tech.
Even if the benefits on offer in each region differ, a centralised benefits platform ensures a recognisable and intuitive experience for people.
Want more insights?
To help you prepare your reward strategy for the next 12 months and beyond, we’ve wrapped up our most sought-after research, insights and thought leadership just for you. We've put together a value-packed bookshelf with our five most-read reports this year.
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