Over the past six years, grocery chain Longos more than doubled its employee base — from 1,800 to 4,400. However, some aspects of the business weren’t keeping pace with the growth, including communications around total rewards, says Liz Volk, vice-president of HR.
“When we did our engagement surveys, we weren’t getting credit for some of the great things we had in place and there were some clearly identified gaps that needed to be addressed within our total rewards offering,” she says.
So, the Vaughan, Ont.-based company decided to focus on boosting visibility and transparency around total rewards. And in May, Longos mailed individualized total reward statements to each worker.
The double-sided, two-page newsletter outlines an employee’s compensation, benefits and retirement savings plan, and also includes information about wellness programs, corporate social responsibility, training and development and other opportunities, says Volk.
“It’s this philosophy of visibility. Some of our team members (are) not seeing the big, full picture and what the company does and how you can participate and how we support you being the best you can be as an individual. So, that’s why it was really important to us to give visibility to that, a reminder of that and help people understand what they actually have.”
One component of the total rewards communications that required a major overhaul was the compensation system. Every year, employees had a performance appraisal and the opportunity for a pay increase, but no one really understood the system behind it, says Volk. They were unclear on how they could perform better, achieve a pay increase and continue to be rewarded for their performance.
To address this, Longos put up total rewards communication boards in each of its 25 stores, with information on the different areas of total rewards including compensation, benefits, retirement and the employee assistance program (EAP). New communication is added on a monthly basis.
“We also theme it and work with various providers, so the theme might be around retirement if we’re getting close to RRSP (registered retirement savings plan) season, so letting people know how they can take advantage of all the offerings there and ideas on how to save more dollars around their pension plan and what that would look like,” says Volk.
The bonus program was particularly misunderstood, so Longos revamped it and placed bonus boards in each store.
“The program was simplified so people can understand the measures,” says Volk. “It was very user-friendly — we had a colour-coded system so people understood each quarter how the company was performing and what does that mean to a potential bonus, or lack thereof.”
Longos managers are also encouraged to discuss total rewards in daily team member huddles and direct employees to the total rewards boards to see what’s new.
To overcome the communication challenges of a retail environment — where employees are not at desks with computers and are spread across numerous locations — Longos is setting up TV screens in lunchrooms to push out ongoing corporate communications, a big part of which will be around total rewards, says Volk.
Throughout the process of revamping its total rewards communications, Longos also saw a need to update its employee benefits program. In order to keep up with the growth of the organization, the grocery chain instituted a flex-benefits program two years ago.
“We recognized our benefits plan wasn’t really keeping pace with the shift in our team members. We’re hiring so many more gen-Y team members and having different generations in the workforce that we recognize the best approach would be to move to a flex-benefits plan and really focus on wellness,” says Volk.
The new plan offers three different options and includes key aspects the old plan was missing, such as a short-term disability program, an EAP and several wellness components.
The change management in shifting from a culture of non-visibility to visibility around total rewards was one of the challenges Longos had to overcome. Change can be uncomfortable for some people and there was a lot of education required, says Volk.
“For example, on the benefits plan, we moved from 100 per cent company-paid — albeit lots of gaps in the program — to three modules: The first is 100 per cent company-paid, the next two modules are cost-sharing. So, that would have been a shift in trying to communicate that the team members are going to participate, but they will get more for it.”
The new communications program around total rewards has increased engagement scores in some areas of the business, and increased employee survey scores for the questions about the relevance of benefits and the fact the company cares about employees and their families, says Volk.
The increased visibility has also enabled Longos to continue attracting and retaining great talent, she says. Managers are able to have very clear conversations with current and potential employees about what the company can offer them, which is important in a highly competitive employment market, she says.
“It helps raise our employment brand awareness,” says Volk. “Team members are feeling very proud to work for the company and we’re getting more and more employee referrals as we open new stores or open in new communities. And we’re hearing a lot of: ‘You know what? I work for a really great company.’”
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