Employee Compensation and Benefits: Trends 2024

It is with no doubt that the 2020 global pandemic has influenced the changes in the professional sphere – especially in employee and employer relationships.

Kim Buckey, the VP of client services at Optavise, a benefits administration powerhouse based in Indiana, forecasts significant changes in the benefits and compensation environment. Her advice is centred on adopting a well-crafted strategy that would help navigate the complexities of total rewards in 2024.  

Based on the advice of Miss Buckey and the changes in the European employment atmosphere, here are the top 5 benefits and compensation trends that employers should pay close attention to. 

More pay Transparency  

Currently, employee compensation and benefits are influenced by the increasing access to compensation and benefits data through online platforms like Glassdoor, LinkedIn, and others. This wave of transparency is empowering employees to advocate for competitive packages. In light of the transparency, several European countries including France, Spain, Belgium and the UK are implementing laws that promote pay transparency. These laws will require companies to maintain and provide access to a register of employee wages, broken down by gender, skill level, education level and many others. 

             Bonus Read: Compensating Employees in Europe

Emphasis on Health insurance benefits 

European companies are increasingly adopting various strategies like wellness programs, telemedicine, and value-based care to supplement the already existing healthcare benefits. More companies are offering health allowances, often through flexible spending accounts or health savings accounts, to cover various health-related expenses outside of standard insurance. This approach reflects a commitment to comprehensive employee well-being and cost-effective healthcare solutions. 

Pension 

With a large number of senior employees approaching retirement, retirement planning strategies are becoming a popular topic across Europe. Both employers and employees have an interest in occupation pensions thus looking for ways to enhance private pension schemes that would supplement existing pension schemes. Companies are taking different strategies to ensure their employees are ready for retirement. These include; 

• Facilitating access to private pensions.
• Introducing flexible retirement options 
• Promoting financial literacy 
• Customising retirement solutions
• Lobbying favourable policies  

Adaptation to the new ways of working 

Adapting to the changes in the workforce has become a growing trend in the compensation and benefits sector for several employees, driven strongly by factors such as demographic shifts, changing employee expectations, technological advancements, and evolving work models. This reflects a shift in how companies are approaching workforce management, with a focus on flexibility, inclusivity, and personalization.  

Employees are continuously opting for remote, and flexible working – and increasingly gaining support from governments. In 2020, Spain enacted the remote work law, which formalized remote work arrangements, requiring companies to cover the cost of working from home and ensuring that remote employees have the same rights as those working on-site.

    Bonus read: Employee Cost and Benefits in Benelux Countries

Custom benefits

The tradition of providing a one-size-fits-all benefits package is becoming outdated. Employers are moving to tailored, data-driven solution packages to strive for a competitive in attracting and retaining top talent. Manufacturers must align benefit packages with the diverse needs and preferences of their workforce.

Having feedback from employees about the benefits and compensation is a strategy that not only enhances employee satisfaction but also fosters a deeper sense of loyalty and commitment. 

To customize benefits, it has been observed that employers are using data analytics, hence enabling employers to dissect and understand the myriad factors that influence satisfaction and productivity.

By analyzing demographics, lifestyle choices, and career aspirations, companies are identifying what benefits are more valued across different employee segments. These range from flexibility in working and comprehensive health care packages to personal development programs.

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Additional Read: Employee Benefits in France