What Is Total Rewards?

The WorldatWork Total Rewards Model demonstrates the dynamic relationship between employers and employees. Originally introduced in 2000, it has evolved to depict the strategic elements of the employer-employee exchange as well as to reflect how external influences and an increasingly global business environment affect attraction, motivation, retention and engagement.

Total Rewards Model SVG Graphic EXTERNAL INFLUENCES Economic | Labor Market | Cultural Norms | Regulatory Business Strategy Human Resources Strategy Organizational Culture Total Rewards Strategy Compensation Benefits Work-Life Effectiveness Recognition Performance Management Talent Development

To learn more about an area of the model,
click on it.

The six elements of total rewards that collectively define an organization's strategy to attract, motivate, retain and engage employees are:

  • Compensation: Pay provided by an employer to its employees for services rendered (i.e., time, effort, skill). This includes both fixed and variable pay tied to performance levels.
  • Benefits: Programs an employer uses to supplement the cash compensation employees receive. These health, income protection, savings and retirement programs provide security for employees and their families.
  • Work-Life Effectiveness: A specific set of organizational practices, policies and programs, plus a philosophy that actively supports efforts to help employees achieve success at both work and home.
  • Recognition: Either formal or informal programs that acknowledge or give special attention to employee actions, efforts, behavior or performance and support business strategy by reinforcing behaviors (e.g., extraordinary accomplishments) that contribute to organizational success.
  • Performance Management: The alignment of organizational, team and individual efforts toward the achievement of business goals and organizational success. Performance management includes establishing expectations, skill demonstration, assessment, feedback and continuous improvement.
  • Talent Development: Provides the opportunity and tools for employees to advance their skills and competencies in both their short- and long-term careers.

Total Rewards Resources

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