What employees want: A reward guide to increasing employee satisfaction in 2026

Day to day employee experience is where the larger pressures of AI, planning, payroll and reward become visible.  

A substantial share of employees in Europe seem to have the basics covered. Manageable workloads, clear priorities and the sense that work will remain sustainable form a strong backbone. However, a critical minority of workers are standing on shakier ground.  

Our 2026 HR & Payroll Pulse report explores employee sentiment in detail. It reveals that one in four employees feel dissatisfaction, among other findings, and shows how these insights can act as an early warning sign for companies across Europe.  

This article, powered by SD Worx Research Institute insight, provides a glimpse into employee experience in 2026 and how smarter reward strategies can give long-term value for your people.   

Our Pulse 2026 research demonstrates that the current ways of working are not suitable for Europe’s employee base. Most people are not dissatisfied with their work overall, but there is a minority that does feel that way. This cohort must not be overlooked. 

Moreover, nearly half of employees are not satisfied with their work-life balance. This suggests that while there is a feeling of general satisfaction, balance could be improved.  

Nearly a quarter of employees are also dealing with negative or toxic behaviors at work, showing how leadership has an outsized influence on systems and experience. Again, we see that the majority of workers have positive experiences, but 22% reporting mental health issues with work is an important insight to highlight.  

These data points show that companies should pay closer attention to better workforce clarity, clearer compensation and reward schemes and more understandable systems. While the top drivers of employee satisfaction tend toward fair and competitive pay and job stability, creating a positive, healthy and respectful culture is also critically important.  

Workers in Europe facing rising costs and other political and social factors want their work environments to be as positive as possible. Support in many respects is an important driver for employees, as is cultivating a healthy and respectful workplace culture—36% of employees put it in their top five among supportive colleagues (43.4%) and work-life balance support (37.8%).  

These considerations are only part of the story. Reward is where companies demonstrate how much they really value the people comprising their workforce.  

Fair and competitive pay remains the top driver of employee experience. More than half (53%) of employees place it in their top five, surpassing job security and stability, work-life balance support and all other drivers and benefits.  

Our Pulse research does show that more than half of organisations (55.8%) offer fixed salaries, which suggests that a majority of companies strive to meet that employee expectation. However, many companies are also trying to figure out ways to add to rewards packages without inflating salaries.  

Labour is simply getting more expensive, so organisations across Europe are looking to find ways of retaining people or drawing in new workers that do not involve high salaries. So, what do employees really want and how can that insight inform reward strategies? 

It turns out that while fair and competitive pay is a top driver, employees often want more time off and flexibility, supporting the overarching desire for work-life balance. Only 25.8% of employees would like a fixed salary, for instance.  

When asked which types of rewards they would like to receive, regardless of whether they currently receive them, extra days off is the most common answer. Nearly one in three (30.6%) of employees want flexible working hours, though 27.1% of companies do already offer them. 

An interesting gap here is how many employees would like health and well-being programmes such as medical check-ups, fitness passes, healthy food and massages. One in four (25.5%) of people show a desire for this in their reward structure, while 14% of companies offer it.  

Critically, there is also a gap between the need for more pension and health insurances versus their inclusion in reward packages. Reward leaders can take these gaps as a guiding principle in acting on the growing workforce appetite for balance and support outside of efficiency and productivity.  

Pulse data more generally shows a gap between what employees get and what they say they value. However, the correct reward mix will always depend on factors like a company’s geography and culture, the types of roles covered and employees’ life stages.  

Only 21.3% of employers currently offer people the ability to compose their rewards mix, though that option is the fifth most valued reward option for employees. Organisations should invest in benefits their employees value, and be more personal in how they structure rewards.  

Whether you get feedback from employees or involve them directly, it seems increasingly beneficial to move away from a one-size-fits-all approach to rewards. More flexible strategies tend to be more cost-efficient and valued by employees.  

Everything is becoming more expensive in Europe, from labour and hiring to the cost of living in general. Organisations and employees are all experiencing financial stress to some degree. In response, companies are looking for ways to cut costs while some employees are feeling uneasy about addressing these concerns with their employers.  

Whether or not organisations can actually afford to increase pay packages, the reality is that current wages do not seem to cut it in Europe. However, financial stress is not only about income.  

This is where companies stand to make a difference, even if higher salaries are not yet in the cards. Organisations have the capacity to support people with better financial literacy and guidance that respects the current situation. Reward packages can include financial well-being support and optimisation tools for financial management.  

It is important to note that these ideas are not a fix for financial insecurity, but a support mechanism. Actual financial support, rather than guidance, is still a stronger value add for employees. And some companies in Europe are committing to that. 

Currently, many companies across Europe are building reward systems without the proper foundations in place.  

Organisations are experimenting with cafeteria plans and mobility budgets, for instance, and giving employees the ability to optimise benefits plans. These are short-term measures and address financial and workplace stresses in a way that is not strategic or systemic.  

SD Worx Research Institute findings suggest that there is now a notable lack of structure and consistency in how reward is developed and implemented. In many cases, pay scales remain unstructured, job descriptions are inconsistent and there is less than ideal progress on job architecture. These factors make it challenging to make reward governable.  

Stronger foundations allow for clarity and transparency, which are necessary for more structured reward systems.  

HR leaders are facing a myriad of challenges in 2026, with changing workplace and reward expectations as only one of these pressures. Our 2026 HR & Payroll Pulse report, powered by SD Worx Research Institute research, explores these issues and best practices for tackling them.  

For the latest evidence-based insights, head to the SD Worx Research Institute hub to better understand and address your unique reward and payroll challenges.  

Looking for the full story and the data to back it up? The 2026 HR & Payroll Pulse Europe report explores how workplaces are changing, what employees expect today, and what HR leaders can do to make work better.