'The design of these programs needs to swing back,' says Normandin Beaudry's Darcy Clark
The era of incremental tweaks to compensation and benefits plans is over. As employers face a collision of macroeconomic volatility, regulatory tightening, cost escalation, and shifting workforce expectations, they’re being pushed to fundamentally reimagine how total rewards are structured and delivered.
“The idea of defensive total rewards isn’t about retreat, it’s about strategic resilience,” said Marianne Assaf, partner, Toronto office leader and savings practice leader at Normandin Beaudry (NB) during the firm’s virtual meet-up on Wednesday. “It's about building programs that can weather economic volatility while still attracting and retaining talents. And it's about reimagining aspects of total rewards. And above all, while there are factors which affect differently some industries and regions, there are forces that affect all companies and industries. Therefore, it's about being proactive rather than reactive in the face of these forces.”
These forces aren’t just creating short-term challenges for HR leaders and experts alike - they’re exposing cracks in outdated total rewards frameworks that can no longer sustain long-term talent strategies.
“The pendulum has gone a little too far. The design of these programs needs to swing back. Right now, employee expectations are here and business expectations are over there. You can’t just keep pouring money into total rewards programs to retain people at all costs,” said Darcy Clark, senior principal in the firm's compensation practice.
Meanwhile, Francis Boulianne, principal in group benefits at NB, highlighted how the industry is seeing more “of an evolution approach than a revolution,” he said. “Organizations are no longer waiting five years to redesign their plans. They’re fine-tuning every year, sometimes every quarter.”
Dimitri Poliak agreed with Boulianne that pensions and benefits should be revisited regularly, not just through an employee value proposition or engagement lens, but also to manage costs and refine the overall design. After all, waiting too long, he warned, can be dangerous.
“When you get cost increase after cost increase year over year, at some point cost management needs to happen,” said Poliak, principal, investment consulting and savings at NB, adding that strategic discussions about design and sustainability must happen early. “Because once you’ve hit that wall where it becomes unsustainable, it’s already too late.”
As chief people officer at Wajax, Mark Edgar explained that total rewards are viewed holistically - not limited to compensation but encompassing the full employee experience. That includes career development and workplace flexibility, elements he believes are increasingly central to how employees perceive value.
He sees the delivery of total rewards shifting toward a more personalized model, though that comes with clear trade-offs. Employees want options that reflect their individual needs, whether they’re starting a family, buying a home, or nearing retirement. Still, he acknowledged that customizing programs for thousands of employees isn’t feasible either.
The challenge, he noted, is balancing personalization with affordability. Futureproofing, according to Edgar, is about ensuring offerings stay competitive without trying to do everything.
“You have to be on the right side of where innovation is going,” he said, emphasizing the need to strategically invest in the most valued elements of total rewards to attract and retain top talent.
For Natasha Bagley, director of total rewards, at IKEA Canada, total rewards serve as a reflection of the company’s values, intentionally designed to support co-workers across all aspects of their lives. The strategy goes beyond compensation to include financial, physical, emotional, and social well-being.
Bagley believes future-proofing total rewards is essential to stay aligned with the changing needs of a diverse workforce. Flexibility is critical, and IKEA continuously reviews its offerings to adapt. “We regularly review our offerings to support well-being, reflect feedback, and adapt to changing expectations,” she said in a statement.
Yet, Clark urged caution around the idea of “futureproofing” total rewards programs, noting that unpredictability, especially in the wake of COVID, makes it impossible to guarantee any program is truly insulated from future shocks.
Instead, Clark sees futureproofing as aligning employee expectations with business realities—particularly as economic pressures mount and CFOs begin scrutinizing the ROI of reward programs more closely. e emphasized the importance of accepting healthy turnover and designing programs that work for both the business and its people, even if that means dialing back.
Poliak also noted a growing shift in total rewards strategy, where performance is becoming a more central theme even in areas like pensions, where that hasn’t traditionally been the case. This doesn’t just mean pay-for-performance, but a more integrated approach where performance expectations shape how programs are designed and communicated.
“It can go as far as even redesigning certain pension programs to be performance aligned,” he said. Still, Poliak emphasized, it begins with dialogue, ensuring that employees understand what’s being offered and what’s expected in return.
Clark argued that the design and delivery of total rewards programs need a shift in priorities, from focusing primarily on employee engagement to putting business needs first. Over the past few years, he said, too much weight has been placed on the assumption that “employee engagement equals performance.”
While engagement is important, Clark noted it’s not the sole driver of strong financial results. That’s why he emphasized that programs should be designed to support business outcomes first then engagement should follow, while also cautioning against over-accommodating employees out of fear of attrition.
“If employees don’t like the change in the bonus plan… and that disengages them, they’re probably going to leave anyway,” he said. “You can’t just keep giving kind of the lollipops to stop the crying because you’re going to run out of lollipops.”
Clark ultimately emphasized the need for organizations to brace for more difficult compensation conversations in the years ahead. With many companies expecting to miss bonus targets or significantly reduce salary increases, leaders will need to get comfortable being transparent with employees about what’s changing and why.
He also stressed the urgency of building a culture where tough discussions—like explaining why bonuses aren’t being paid—are normalized.
Poliak agreed, underscoring the importance of delivering these messages through a clear and consistent narrative tied to the organization's employee value proposition.
“It’s a two-way street,” he said, emphasizing when expectations can’t be met, employers need to explain the “why, how, and what” behind those decisions.
He also noted a broader shift toward a more integrated approach to total rewards.
“We’re seeing a lot of organizations consolidating comp, benefits, and pensions into one function,” he said, adding that a holistic mindset is increasingly essential for aligning employee experience with business priorities.
