(Solution) 7HR03 concepts of universal benefits as opposed to flexible ‘cafeteria’ style benefits and recommendations

Solution

7HR03 Strategic reward management

Question 2 (AC 2.4) Evaluate the concepts of universal benefits as opposed to flexible ‘cafeteria’ style benefits, recommending which approach would be most suited to the organisational context. Justify your recommendations.

Question 2 (AC 2.4)- 1,016 Words

Evaluating the Concept of Universal Benefits

Balkin & Werner (2023) define universal benefits as benefits which are provided to all employees, such as regular pay rises, job security and health schemes, regardless of their role, seniority or personal circumstances. These universal benefits are not discriminatory to any employee on the grounds of either their gender or skills. The employes are benefitting mainly from the universal rewards since they are not discriminatory to the employees due to possession of protected characteristics. Perkins et al. (2021) assert that employing this approach enables organisations to ensure fairness and consistency, promoting equality among all individuals in the organisation. The predictability and simplicity of universal benefits is one of the primary advantages of this type of program. With all employees receiving the same package, administrative efficiency is improved and HR complexity and costs reduced (Reed et al., 2023). This structure also enables a strong employer brand by making employees believe the organisation is fair and transparent. It also ensures labour law and industry standard compliance, and reduces likelihood of disputes pertaining to benefit allocations (Sheppard-Jones et al., 2021). In addition, universal benefits can also be an effective way of boosting employee morale and engagement, especially if they include provisions like healthcare, pensions, and paid leave. Knowing that the organisation provides comprehensive support makes employees feel valued (Sokolov & Zavyalova, 2020). Additionally, it can be immensely useful in industries where job demands are similar for majority of employees, including aviation where workers face uniform challenges like irregular working hours (Dang et al., 2021).

However, one disadvantage of universal benefits is the lack of flexibility. A standardised package cannot accommodate various employees’ financial, family, and career-related preferences and needs (Andriani, 2022). For instance, younger employees may prefer professional development subsidies over enhanced pension contributions, whereas older employees may prioritise retirement benefits. An additional limitation is that universal benefits may not be competitive in attracting top talent. Fenny et al. (2021) mention that if competitors are able to customise benefits, Riyadh Air runs the risk of losing capable staff to companies that have customised their compensation plans. Also, inefficiencies occurs when employees are not taking full advantage of the benefits that are provided, resulting in wasted resources (Kant & Asefa, 2022). Rigid universal systems may not meet diverse needs of Riyadh Air, with……

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