The Challenges of Transparency

The Challenges of Transparency How much to communicate about pay is a continual
debate, one for which there is no clear answer. Those in favor of open communication
feel that unless employees understand their organization’s pay system and how their pay
is determined, it will not achieve its primary objective of supporting the achievement
of strategic business objectives. But, even proponents of reward program transparency
recognize that a level of employee privacy must be preserved. The result of complete
openness can foster jealousy and performance problems.

Effective total rewards communications have become even more important now when
employees are faced with making a decision between their economic needs (i.e., their
pay) and the level of health and retirement benefits they would like to receive.
Today, employers have an array of communication tools to choose from. Technology
enables the creation of individualized reports informing employees about reward
program eligibility and payouts. Computers make the dissemination of rewards information
via e-mails, websites, webinars, DVDs, and other electronic media fast and cost-effective
at work, at home, and, in fact, almost anywhere. Despite this, experts agree that rewards
communications are, more times than not, done poorly; for the most part, employees do
not understand how they are paid and what factors determine their eligibility for most
reward programs.