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Ideas for Leaders #585

Incentivizing Managers to Promote Employee Health: The 10% Solution

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Key Concept

In a recent study, a majority of managers agreed that companies should incentivize managers to promote employee wellness by linking their compensation — specifically 10% of bonuses and promotions — to the employee wellness activities and initiatives they have implemented.

Idea Summary

There is a growing consensus that employee wellness is good not only for the employee but also good for the company. It’s not just a matter of sick days. Healthier employees are more productive and more engaged when they are in the office. Companies are taking a more active role in promoting wellness in their employees. In a forthcoming article in the Journal of Health Promotion, two researchers argue that managers hold the key to employee wellness. The reason is that in the workplace, changes in employee behaviour most often occur as a result of interactions with managers. Therefore, according to Rebecca Robbins of the NYU School of Medicine and Brian Wansink of Cornell University’s Dyson School of Applied Economics and Management, the best way to promote wellness is to encourage and enable managers to become actively involved — and one way to push this active involvement is by linking compensation to wellness activities. 

Robbins and Wansink conducted a survey of 270 managers, gauging their reactions first to companies who engage their managers in employee health initiatives, then to a specific proposal: 10% of a manager’s bonus or promotion would depend on an assessment of that manager’s efforts in promoting wellness. (The idea is to reward activities, not results. No company would hold a manager accountable for an employee’s weight loss.)

Participants were also asked whether they would take the opportunity to leave their current company for a company that engaged their managers in employee wellness, if the opportunity occurred.

Finally, participants were asked to describe what types of wellness initiatives they would implement if their performance were partially assessed by such initiatives.

The results of the study revealed that most managers were in favor of managerial engagement in employee wellness efforts — and the evaluation of such engagement playing a role in compensation decisions.

The first step was assessing the participants’ attitudes about management engagement. After reading a vignette that described one company as having managerial evaluations for employee health and another company that had no such evaluations, most participants matched positive descriptors (flexible work environment, focus on employee development) to the second company, while matching negative descriptors (stressful work environment, supervisors micromanage employees) to the first company — indicating more positive attitudes about the company that engaged their managers in employee wellness. Women managers and managers with a lower number of employees were slightly more critical of the company without management engagement.

Reactions to whether managers should have their compensation partially linked to their activities in the area of employee wellness was also positive.

Survey questions measured participant attitudes toward the 10% proposal — they responded on a scale of 1 (strongly disagree) to 7 (strongly agree) that such a policy would be “good,” “desirable,” “appropriate,” and “controversial.”

Participants were then given a list of potential advantages (e.g. the policy would “improve employee morale,” “increase employee engagement,” or “result in few sick days”) and disadvantages (e.g. the policy would “violate employee privacy,” “be challenging to measure,” or “put too much responsibility on the manager)”, and again could respond on a 7-point scale from strongly disagree to strongly agree.

A majority of respondents, without any significant difference among gender or other demographics, had a positive attitude toward the proposal, and saw more advantages than disadvantages.

Respondents also indicated their intention to implement a variety of wellness initiatives from a given list of 18 such initiatives, including “encouraging group exercise,” “holding a benefits fair for employees,” and “providing healthy snacks in meetings and common areas.”

Finally, the managers in the study indicated that they would indeed leave their companies for companies that engaged managers in wellness programs.

Business Application

The survey results are unequivocal in revealing management support for being evaluated and incentivized based partially on their actions promoting employee health.

The core lesson for companies and organizations is that targeting wellness promotion to individuals — for example, goal-setting seminars, one-on-one coaching sessions, or encouraging an individual to start a fitness routine —is only one path for promoting employee wellness.

A more potent path is to leverage the social forces in a company, specifically the power of manager-employee interactions. The first step is to ensure positive interactions — contentious or unsupportive relationships have shown to be detrimental to employee health. Beyond this baseline, managers should be incentivized through their compensation packages — or at least the bonus or promotion components of their packages — to be actively involved in implementing employee wellness programs or initiatives. This study shows that such compensation measures will be welcomed by the best managers — and will inspire them to take action.

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Authors

Institutions

Source

Idea conceived

  • February 2016

Idea posted

  • February 2016

DOI number

10.13007/585

Subject

Real Time Analytics