Reward and pay are important factors in the process of attracting, retaining and engaging employees. There's a range of options available for organisations to reward their staff and recognise their contribution, each with their own benefits and risks, but the most effective reward packages will be aligned with the business needs and reflect the organisation’s values.

This factsheet explores the purpose of pay and reward and how employee responses may vary depending on different contexts and circumstances. It introduces pay structures and levels, the considerations surrounding pay awards and the factors affecting pay progression. It also describes variable pay – from cash bonuses to incentives – as well as outlining some UK legal issues such as equal pay, the national minimum wage, national living wage and executive reward. Finally, it outlines the role of employee benefits, non-financial rewards and total reward.

CIPD viewpoint

What are reward and pay?

Managing pay and reward

Determining base pay and total earnings

The role of employee benefits

Non-financial rewards and total reward

Useful contacts and further reading

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