At the end of another challenging 12 months in Pay and Reward, we asked some of our senior consultants to reflect on their key takeaways from a busy year delivering client solutions in 2025.
“Reframing the psychological contract” - Justine Woolf, Director of Consulting
For many, a renewed focus on performance has been key, trying to move away from the Covid legacy - where organisations dialled up wellbeing and support - towards a reframing of the psychological contract. We’re seeing expectations around accountability and delivery shift back into focus, with organisations reviewing their approach to performance management and reintroducing performance-related pay as a way of reinforcing the messaging.
We’ve also seen a significant uptick in the desire to review bonus schemes, making them clearer, more meaningful and more focused on rewarding top performers, as opposed to ‘peanut butter spreading’. We feel the emphasis needs to be on ensuring they are targeted and provide return on investment, so that organisations see value in their spend. I expect that to continue into 2026. More about Justine >
Simplicity and clarity the order of the day – Spencer Hughes, Senior Consultant
I feel a lot of organisations went into 2025 trying to keep costs down, but quickly found that pay, progression and transparency still really mattered to employees. Where reward frameworks were over-engineered or relied too heavily on manager judgement and unwritten rules, we saw frustration build. By contrast, the businesses that coped best kept things simple and built clarity around pay and progression: performance conversations landed better when expectations were obvious and consistently applied, not open to interpretation. More about Spencer >
“Squeeze year” - Simon Cook, Senior Consultant
I think 2025 was the ‘squeeze year’ - after a few years of inflation driving higher pay awards, businesses could not sustain pay at those levels. The added pressures of NI increases and raises to the minimum/living wage rates resulted in a real squeeze on pay budgets.
Aside from the discussions on headline pay budgets, the real impact for businesses is on the assessment of what skills they need and the competitive pay for these skills. The technological advancement in AI is pushing this conversation up the executive agenda. More about Simon >
“Benefits health checks the order of the year” - Holly Coe, Senior Reward Consultant
What a year 2025 has been! For me, benefits health checks have been the order of the year with employers wanting to ensure they are providing value for money and giving employees the benefits they really need. I feel fortunate to have been able to work with some amazing clients and together we’ve delivered so much.
As an Innecto team, it was fantastic to be finalists at the Reward and Incentives Awards, and another recent highlight was travelling to Paris to showcase Pathfinder, our new career pathways software, which I think could really take off in 2026! More about Holly >
A big year for Innecto - Sarah Lardner, Director of Business Innovation, Senior Principal Consultant
Looking within our own four walls, I’m proud to say that 2025 has been a year of significant achievement and transformation for Innecto. We’ve successfully designed and delivered Pathfinder, a new career pathway platform enabling organisations to create transparent, future-focused progression frameworks. We think it could be a game-changer for HR.
We’ve also strengthened many of our client partnerships across diverse sectors, helped by a new Advisory Board keeping us at the cutting edge of the changing requirements in HR & Reward.
Our thought leadership has also gained recognition and traction across industry publications and events, including around bonus scheme projects, which have been particularly prominent this year. That’s been driven by clients seeking to balance cost control with performance incentives in an uncertain economic climate. It’s a trend that also highlights a growing need for agile, data-driven reward solutions that can flex to changing priorities, which brings me back to Pathfinder and our other HT Tech tools. More about Sarah >
Before they came to Innecto, our consultants built up years of experience in-house. Find out more about the Innecto Team.
