Why You Should Be Considering an Emotional Salary
Woman working remotely on the patio of a coffee shop.
Written by Steven Urban and Kat Cox
Workers feel worse about where they work and what they do for a living than they’ve felt in a long time. According to a new study from Aflac, only 48% of workers believe their employers care about their well-being. These employees are more likely to look for a new job in the next year, which is bad news for employers who have invested in hiring them, training them, and developing them within their company.
As Fast Company points out, an even more concerning stat is that 57% of employees are going through at least some form of burnout. Employees who go through burnout lag in terms of productivity, bring down employee morale, and often suffer health consequences that take them out of the workforce altogether. Burnout costs the economy almost $2 trillion a year. Plus, employee engagement has been dropping in recent years, and is currently at 33%, according to Gallup.
To combat the negative effects of these trends, more and more employers are starting to offer an “emotional salary” for workers. Explore the concept of an emotional salary, how it differs from traditional engagement or wellness programs, and ideas for implementing one in your organization.
What is an Emotional Salary?
The term “emotional salary” was coined by the Achievers Workforce Institute (AW), and encompasses any aspect of a job that rewards an employee beyond their pay or benefits. An emotional salary is basically how a company shows employees that they care about their well-being and listen to their needs. Workplace culture, development and growth opportunities, flexibility, and work-life balance are all part of the concept.
While Gallup reported in 2022 that most employees (64%) are looking for a significant increase in pay in their next job, better work-life balance and better well-being came in a close second (61%) followed closely by the ability to do what they do best (58%). Also, high-performing employees who already make enough money to live comfortably won’t be motivated by higher pay. This means that employers who are looking to attract and retain the best talent can’t just throw money at applicants and hope for the best.
How is an Emotional Salary Different from Employee Engagement or Well-Being Programs?
Employee engagement is a measure of how involved employees feel with the organization they work for. Employees who are engaged are more productive, more creative, and more involved in a company’s success beyond their job description. They’re also less likely to call out sick or miss work, less likely to quit their jobs to work elsewhere, and less likely to have a safety incident at work. Engagement leads to better quality products and services and better profitability for companies.
While improving employee engagement has great benefits for a company, it’s an elusive concept. Figuring out how to get employees engaged is difficult. Most companies have traditionally relied on employee surveys, which take too much time to tally or act on, leaving employees and managers waiting for insights to put into action. Most leaders don’t have time to think of ways to improve engagement or build new employee culture programs. In the end, employee engagement and well-being programs have tended to be passive and retroactive rather than proactive and intentional.
An emotional salary program is more concrete than an employee engagement program because an employer has to clearly define what it means in order to offer it. It’s also more proactive than engagement, well-being, or culture-building programs because it’s offered as a package for employees when they start, rather than an afterthought when they’re already disengaged. Instead of offering employees a bandaid like a meditation app or a weekly happy hour, an emotional salary is integrated as part of the foundation of an employee’s job.
By expressing your intentions of an emotional salary upfront, you give employees the opportunity to hold you accountable for upholding it. It also provides the organization with tangible goals to meet when it comes to employee engagement and satisfaction, rather than going round and round with research after disengagement is already in play. This helps build trust between employees and employers.
What does an emotional salary include?
AWI notes that an emotional salary should encompass five aspects that contribute to higher job satisfaction: cultural alignment, recognition, work relationships, feedback, and career progression. There are many ways that employers can include these in a concrete emotional salary plan:
Walking the Walk When It Comes to Values
Employees care more than ever about how their values align with those of their employer. This includes internal culture such as workplace goals and diversity initiatives as well as how the employer impacts the world externally. Employers should be able to state their values clearly and include employees’ feedback to continually improve this alignment.
Beyond just being able to clearly state the organization’s goals or talking the talk, leadership and management need to walk the walk. Employees are often frustrated because the companies they work for list values or goals but leaders and peers regularly violate them without repercussions. This damages any resonance employees feel between their values and the stated values of the company.
2. Recognizing Their Humanity
Recognizing employees for their contributions goes a long way in making them feel valued. While reward programs are important, a simple “thank you” and regular gratitude can make a big difference. But recognition goes beyond showing appreciation for a job well done; it also means recognizing an employee’s humanity.
Workers aren’t robots and every individual brings different experiences and strengths to the workplace. Recognizing their humanity means employers have to trust that they’ve hired employees who are capable of getting the job done at the quality they’re expected to do it. Employers must understand that not all employees work best in a classic 9-5 schedule or function well in an office full-time. Also, as human beings, employees may have issues come up during the work day that they need to address, like childcare, healthcare, or other issues.
Employers can show their trust in their employees by offering flexibility so that employees can choose to do their work when and where they do it best. It also means managers will hold back from micromanaging and respect employee time by reducing unnecessary meetings or busywork. Frequent breaks and time off are also important in recognizing employees’ humanity. No employer can cater to every employee’s need, but offering flexibility and work-life balance builds trust from both sides.
3. Building Trust to Build Work Relationships
Most employees will spend a majority of their time at work, so having good relationships with their colleagues is important to feeling satisfied at work. The foundation of good relationships is trust. If employees don’t trust each other, they won’t ask each other for help, provide honest feedback, hold each other accountable, or commit to ideas that will benefit the team and the organization. Trust also builds resilience between team members when times get tough.
One of the first steps in creating trust between team members is encouraging self-awareness. Employees should be given the opportunity to know themselves and get to know their colleagues in meaningful ways to improve their work relationships.
4. A Meaningful Approach to Feedback
Most employees want to know how they’re doing so they can improve. But they also want to know that the feedback they give to the company matters and will be incorporated into improving the workplace. Employers should provide regular, meaningful feedback and opportunities for employees to make their voices heard.
At the same time, employers need to make a commitment to accountability when it comes to feedback. Simply asking employees for feedback or providing them with surveys isn’t enough if the company isn’t willing to act on the information. Employees who bring up an issue will be frustrated by a lack of follow-through by leadership or management. Organizations must have intentional systems in place to address feedback in meaningful ways. Otherwise, employees will stop providing feedback and/or start looking for jobs somewhere else.
5. Transparent Career Growth and Strength Alignment
Employees want a clear path toward advancement or raises in their workplace. Most organizations will say they have these processes in place, but often it’s unclear to employees how they can advance. Plus, once an employee gets a promotion from individual contributor to management, they often don’t get the guidance they need to make the transition successfully. This creates frustration both for the new manager and their team.
Employees also want their work to be meaningful and to do work that they’re good at. They need their strengths to align to their job duties as well as development programs to intentionally work on expanding their skillsets. Employers need to provide clear opportunities for all employees to become the best they can be.
How do you negotiate an emotional salary?
If employers want to attract and keep the best workers, they have to include the emotional salary in their hiring packages. The best place to start is by listening to what employees want and making explicit programs to offer those benefits. This means intentionally baking these emotional benefits into job offers, including:
Flexible work options – Whether it’s remote work, hybrid work, or a flexible schedule, employees consistently rank this as one of the biggest benefits they want out of a job.
Clear development and advancement pathways – Workers want to know when they start the job what the organization’s commitment to their development is, including internal training opportunities, paid continuing education, or timelines and goalposts for getting raises or promotions.
Transparent communication around values and culture – Employers must be able to define their values clearly and provide proof that they live up to them.
Intentional commitment to fairness – Employees want to be themselves at work and know their employers are committed to fair pay and equal opportunities. This is especially true for Gen-Z workers who see diversity, equity, and inclusion programs as much more than corporate buzzwords.
Defined recognition and reward systems – Employees want to feel good about the work they do and employees need to provide regular recognition for a job well done.
Functional and regular feedback systems – Employers should give their employees the opportunity to make their opinions heard and ensure leadership will act on input.
Employees can also nudge companies in the right direction by asking for the benefits they need when considering a job offer. Not every employer will be able to offer everything an employee wants, but there may be room for negotiating more from the emotional salary, such as more paid time off or remote opportunities after meeting certain goals.
Explore Components of an Emotional Salary with Build Your Alliance
An emotional salary program is an extension of trust between employees and employers. This trust must be built by voicing and aligning values in the workplace. This alignment comes from building intentional programs and systems and committing to accountability and follow-through throughout the organization. Build Your Alliance offers workshops, coaching, assessments, and programs that serve as a starting place to building an emotional salary.
Engage employees through development programs such as Gallup’s CliftonStrengths, Everything DiSC, or Patrick Lencion’s 5 Behaviors to build the cornerstone of a better company culture and more aligned values. Offer new manager development programs to empower managers to build better relationships and foster better engagement with their employees.
Book a corporate experience session with Build Your Alliance to explore how your organization can use our services to start building and offering a better emotional salary to existing and future employees today.