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01 May 2020
by Debi O'Donovan

Inside track: the national scandal of the unfairness in reward and benefits

Right now there is a huge spotlight on all the cracks and unfairness in reward and employee benefits. We clap for all those working in low paid essential services every Thursday, and then read about executives giving up 5% of pay as a goodwill gesture – when that 5% is more than any nurse will earn, and the total remuneration of said CEO runs into six or seven figures.

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Millions of employees, especially in the public sector, have been allowed to opt out of valuable defined benefit (DB) pension schemes, the vast majority of employed low-earning workers are not covered by important insurances such group life and group income protection. These are scandals that have crept up on us so quietly over the decades that we barely notice the huge injustice of them. This is a very unpleasant employment ‘normal’ for one of the wealthiest countries in the world to admit to.

While the announcement this week that the families of health and care workers on the frontline in England will benefit from a new life assurance scheme during the coronavirus (COVID-19) pandemic is laudable, REBA cannot help but ask: why are they not already covered by a DB death-in-service or group life assurance scheme? Perhaps even worse, what about those who are agency staff or working via private sector firms?

Too many gig workers, agency staff and contractors are the product of an unfair and unjust society. Some work like this because they have no choice, with employers trying to get out of employment contracts, paying National Insurance and pension contributions, while other workers choose to be agency or contract staff because they get a bump in pay, even if it means they lose security and benefits.

The results of the Taylor Review, namely Off-Payroll Working (IR35), tried to fix the contract worker ills. That has been delayed a year. But it also gives all of us in reward and HR a chance to reflect on what is truly the right thing to do as an employer. When we return to the new normal, can we make that ‘normal’ different?

In terms of Executive pay – for too long we have been told that we cannot legally change contracts, that shareholders have to vote on changes to pay policies, that the market drives pay. It sickens me when those who advise on pay seem to say: “So what can we do, it’s complicated?”.

We are now in a world where greed and treating the real hard workers badly is not just upsetting apple carts. It is making headlines and calling out people by name – good or bad.

Organisations are being named, shamed or praised.

Those employers which are serious about fairness and transparency will also need to be serious about kindness and equality for all. We are at a moment in time when all this change can be for the good, if we act.

The author is Debi O’Donovan, co-founder & director at REBA.

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