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How do you handle compensation and benefits for remote and hybrid workers?

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Remote and hybrid work models are becoming more common and attractive for both employers and employees, especially in the wake of the pandemic. However, they also pose some challenges and questions for full-life cycle recruiters, who need to ensure that they offer fair and competitive compensation and benefits packages to attract and retain talent across different locations and time zones. How do you handle compensation and benefits for remote and hybrid workers? Here are some tips and best practices to consider.

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1 Understand the market and the regulations

One of the first steps to handle compensation and benefits for remote and hybrid workers is to research and understand the market rates and the legal requirements for each location where you are hiring or employing workers. This will help you avoid underpaying or overpaying your candidates, as well as complying with the local tax, labor, and social security laws. You can use online tools, salary surveys, or benchmarking reports to gather data and insights on the market rates and the cost of living for different roles and regions. You should also consult with legal experts or local partners to ensure that you are aware of the regulations and obligations that apply to your remote and hybrid workers.

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Isaiah Morgan

Husband | Father | Marine | Aspiring Warrant Officer | Continuous Learner | Ora Et Labora.
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Geographic location is important, as costs of living in California and New York are different than Texas or Oklahoma. HR and management have to take these into account when looking to offer compensation and benefits for remote or hybrid workers. Market rates are important, but utilized in conjunction with, not separate from, cost of living, is important.

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2 Define a clear and consistent policy

Creating a clear and consistent policy for compensating and providing benefits to remote and hybrid workers is an important step. This policy should outline how you determine and adjust the pay and perks for your workers based on their location, role, performance, and other factors. You should communicate this policy to your candidates and employees, explaining how it aligns with your company's values, goals, and culture. Moreover, you should review and update the policy regularly to be flexible with changing needs and expectations of your workers. Elements that may be included in the policy are base salary range and frequency of reviews/increases; criteria/process for adjusting salary based on location, cost of living, exchange rate; bonus/commission/incentive schemes; benefits package; allowances/reimbursements for remote work expenses; vacation/sick leave/parental leave policies; accrual and usage rules.

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Jennifer Liggett

Employee Benefits | Retirement Specialist | Freelance Copy Editor
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Some companies may look at remote workers as incurring less costs due to not having transportation expenses to and from the workplace, and consider this as a reason to offer a lower salary. However, hidden costs should be examined, that may fall outside of the cost-of-living index. For workers who work remotely due to a lack of opportunity in a rural area, their internet costs typically are higher. The dearth of available providers (or those in-network), can result in employees traveling outside of their area to utilize medical benefits (which is particularly costly for those with chronic illness).

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Ankit Kumar

Manager - Total Rewards & HR Analytics at Deutsche Telekom
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The best way to implement the work from office, remote/ hybrid workforce compensation & benefits plan Tailor pay structures for work from office, hybrid, and remote and give the choice to employees to opt for the same. Offer flex benefits, allowing employees to opt in based on their preferences & needs. Implement compensation differentials based on location, ensuring fairness and competitiveness across diverse work locations.

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3 Offer flexibility and personalization

A third step to handle compensation and benefits for remote and hybrid workers is to offer flexibility and personalization that allow your workers to choose the best options for their needs and preferences. You can do this by providing different tiers or plans of benefits, or by giving your workers a budget or a credit that they can use to purchase or access the benefits that they want. You can also offer flexible work arrangements , such as choosing their own hours, days, or locations, or having the option to switch between remote and hybrid modes. By offering flexibility and personalization, you can show your workers that you value their diversity, autonomy, and well-being, and that you are willing to accommodate their different lifestyles and circumstances.

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Alicia Thull

Sales & Talent Professional
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Employees are exploring new opportunities because they don’t want to be required to go into the office for 40 hours a week. Flexibility is key to happy employees and long-term retention. Those who want to come into the office, will keep coming in and help create the in person and remote culture. It is important to be specific when targeting certain geographic regions and make sure you know if you can take on sponsorships. Hope this helps!

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4 Engage and support your workers

When providing compensation and benefits for remote and hybrid workers, it is important to engage and support them throughout their employment journey. Give regular feedback and recognition for their work, create learning and development opportunities, foster a sense of community, encourage collaboration and communication, and address any issues or concerns they may have. Following these tips and best practices can help you create attractive and fair compensation packages that will help you recruit the best talent from different locations. Handling compensation and benefits for remote workers can be challenging but also rewarding for recruiters.

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5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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How do you handle compensation and benefits for remote and hybrid workers?

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4

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1 Understand the market and the regulations

2 Define a clear and consistent policy

3 Offer flexibility and personalization

4 Engage and support your workers

5 Here’s what else to consider

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