HR Glossary  >   Employee Value Proposition

Employee Value Proposition

What is Employee Value Proposition?

An employee value proposition is a unique benefit a company offers to its employees in favor of their skills, experience, and hard work they put forth in their jobs. The benefits can include things like salary, health insurance, chances to grow in their careers, and a balance between work and personal life. It also involves your company's values, what it stands for, its social goals, and the type of work environment you have.

EVP is about all the special advantages and experiences an employee gets when he/she chooses to work for your company. It also explains why your company is a good fit for the employees who perform well there and helps attract talents that fits rightly with the goals the company is trying to achieve.

Advantage of having a strong employee value proposition

Putting effort and resources into your employee value proposition can be really beneficial for your business like:

1. Attract and retain top talent

A clear and attractive EVP helps you highlight the unique benefits and opportunities your company is offering to an employee for their growth. This makes it easier to search and keep employees who align with your company and are likely to do well. For example, Gartner found that companies with a good EVP can decrease their annual employee turnover ratio up to 70%.

2. Dedicated workforce

A well-explained EVP helps employees understand what your company aims for and values. As a result, employees become more interested and involved in their job roles. Research shows that companies with a strong EVP increase the commitment of new hires to their jobs by almost 30%.

3. Saving money

If you attract and retain the right talent for your company, it will reduce the hiring and retention costs.

4. Optimize performance and growth

When your employees are dedicated, happy, and performing well, your business does better. It helps you lead in increased profit margin and growth. Teams that are highly engaged can increase a company's profits by 23% and enhance customer loyalty by 10%.

5. Transparent culture

A company needs to be transparent from the start about what it wants from its workers and what they will receive back. This helps create trust and respect in the working relationship between the employees and the company.

Key Components of an Employee Value Proposition

The main components an Employee Value Proposition (EVP) includes:

1. Pay - This includes how much you earn, like your salary, extra money for good work, and other money benefits.

2.Extra Benefits - These are things like health insurance, plans for when you retire, time off with pay, and other special perks that aren't part of your salary.

3. Growing in Your Career - Chances to get better at your job and move up in the company, with training, guidance, and the chance to get higher positions.

4. Workplace environment - What it feels like to work there, the way the company thinks and acts, and how that fits with what you believe and like.

5. Balancing Work and Life - Rules and ways the company helps you have time for both work and your personal life, like flexible work hours, being able to work from home, and getting enough time off.

Modify your HR and payroll tasks with factoHR today

Let your HR and workforce focus on most important business decisions while factoHR can reduce the burden of daily activities of the organization.

Request Free Trial