Actions to Restore Stability Survey

About the survey respondents

Research findings are based on responses from 283 organizations in North America employing 4.4 million employees. The survey fielded in North America between June 22 and July 13, 2020.

Respondent profile:

• 57% multinational companies
• 47% for profit, publicly traded
• 29% for profit, private
• 18% nonprofit/government

Respondents by industry

Overview

Organizations move forward, powering the employee experience and rethinking work and rewards

Our COVID-19 Actions to Restore Stability Survey explored how organizations are reprioritizing business performance and people objectives to achieve a sustainable reset of their business models.

Findings reveal that senior leaders are focused on protecting employee health and wellbeing, key aspects of the employee experience. Many employers say that they have sufficient budget to effectively deliver on their existing talent and reward programs, but fewer have the resources to adopt new technologies or add critical new programs.

Organizations are making adjustments to accommodate new protocols in response to COVID-19 but are also still determining what new ways of working will be required as they emerge from the crisis. For now, the most significant shift has been in the proportion of full-time workers that are working from home: Employers expect 19% of their workforce to be full-time employees working from home post-COVID-19, which is roughly half of current levels (44%) but almost three times last year’s figure (7%).

While 55% of respondents expect the pandemic to have a moderate or large negative impact on business in the next six months, only 43% expect a similar impact over the next year.

As organizations manage through phases of the ongoing crisis, many are recalibrating strategies and programs tied to work, rewards and the employee experience. A dramatically reconfigured workplace and workforce will require agile leadership that effectively balances employee and business performance needs, supports new ways of working and powers new sources of organizational value.

“One of the myriad of challenges employers face as they begin to restore stability in a post-COVID-19 era is which employees to bring back to work and when,” said Ravin Jesuthasan, managing director, Willis Towers Watson. “While those decisions will ultimately depend on public health and economic recovery, employers will also need to continue to adapt to having a larger percentage of remote workers, and this will fundamentally change their culture.”

Highlights at a glance

1. Managing labor costs

   • 65% of organizations have frozen or reduced hiring.
   • Almost half (45%) have taken action on pay; another quarter (22%) are planning or considering taking such action.
   • Two out of five (43%) have taken at least one action on furloughs/alternative work arrangements.

1. Emerging reward practices

   • 14% of employers have not implemented merit increases this year; a similar percentage expect no increase next year.
   • 47% of organizations with a broad-based employee short-term incentive plan expect it to be funded at target this year.
   • Only 25% of organizations have identified employee segments targeted for reward actions.

1. Changes to work

   • 79% of organizations are adjusting how work is done to accommodate new protocols.
   • 58% are making adjustments to the definition of the role of the workplace and what work should be primarily done onsite versus remotely.
   • One in five employers are developing policies and providing resources for employees who may work remotely long term.
   • One in 10 have taken actions to offer employee subsidies to manage costs of working remotely.
   • Nearly a third are making changes in order to move work to different jobs (29%) and to incorporate automation (27%).

1. Employee Experience

   • Organizations with a positive impact on employee experience are more likely to report doing well on people dimensions, such as building trust and fostering collaboration.
   • Senior leaders (54%) remain focused to a great extent on protecting employee health and wellbeing.
   • Most organizations say they have sufficient budget to maintain (88%) and effectively deliver (82%) existing programs, but fewer have budget to adopt new technologies (49%) or add critical new programs (58%).

1. Sales effectiveness and rewards

   • Organizations give sales programs and policies middling marks for effectiveness in addressing COVID-19-related challenges.
   • Four out of five organizations (80%) say their sales teams are connecting normally with customers.
   • Half of organizations (50%) think sales management is effective in helping their sales force reorient to the new selling priorities.

Executive compensation

Organizations have not made significant changes to key components of executive compensation.

1. Executive incentives

   • Three in four organizations (75%) have not made changes to their executive or board succession plans.
   • Total Rewards is the top topic that organizations’ compensation committee oversee.
   • Nearly a quarter (23%) of employers have already included environmental, social and governance related metrics into their executive incentives.

1. Short-term incentive design

   • Over three-quarters (78%) of respondents are operating their annual incentive plan for executives on a broadly similar basis to last year.
   • One-quarter (25%) of organizations have taken action on their annual incentive plan; two in five (40%) are planning or considering changes.

2. Long-term incentive design

   • One out of 10 (8%) employers has taken action on long-term incentive programs as a result of COVID-19’s impact while twice as many are planning or considering doing so.

3. Total compensation framework – post-COVID-19

   • After COVID-19 and the subsequent economic impact, organizations are most likely to increase emphasis on liquidity.
   • Organizations are also likely to increase the importance of human capital metrics in executive incentive plans.