HR Basics is a series of short courses, designed to highlight what you need to know about a particular human resource management topic. In today’s HR basics, we define total rewards and explore the total rewards model.

Total rewards are the monetary and nonmonetary rewards provided by companies to attract, motivate, and retain employees. To an employee or candidate for employment, the notion of total rewards includes perceived value as a result of the employment relationship.

Originally introduced by WorldatWork in 2000, the Total Reward Model has evolved to depict the strategic elements of the employer-employee exchange impact total rewards today. My Total Rewards Model has been adapted to reflects how external influences impact total reward strategy and affect attraction, motivation, retention and engagement.

There are six elements of total rewards, each of which includes programs, practices, elements and dimensions that collectively define an organization’s strategy to attract, motivate, retain and engage employees: Compensation, Benefits, Work-Life Effectiveness, Recognition, Performance management, and Talent development.

These elements represent the tool kit from which an organization chooses to offer total rewards. The correct combination of these strategies will result in satisfied, engaged and productive employees who will generate desired organizational outcomes. An organization’s total rewards strategy culminates in a workforce that has the right people in the right jobs who are motivated and engaged to do the right things.

Employees feel loyal to the organization and its success. The model demonstrates the dynamic relationship – an exchange - between employers and employees. Championing the needs of our employees and our business interests to realize results through engagement.

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